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Thursday, 16 March 2006 17:22

Gloomy outlook on mobiles

There is little good news in the latest examination of the Australian mobiles market, from Market Clarity.

With the market at near saturation a slow down in growth is inevitable, but, according to Market Clarity, there is also a strong and continuing shift to low-value prepaid services, and as competition in 3G ramps up ARPUs in 3G will decline from a market leading $80 per month to the industry norm of around $57 per month.

According to Market Clarity's "Australian Mobile Voice And Data Services Market Report", the mobile market, which has grown by 120.6 percent since 2000, will only show a further 17.1 percent growth from 2005 to 2010, and low-value pre-paid offerings which now make up nearly half the total are set to grow faster than the market as a whole, rising more than 19.2 percent between 2005 and 2010.

According to Market Clarity CEO, Shara Evans, "3G services show by far the highest average revenue per use...But so far, with about 750,000 3G services in operation at December 2005, the 3G space has yet to experience serious competition...As carriers try to convince users to convert from 2G to 3G services, we expect bundle competition in the 3G market to follow similar patterns to those already seen in the 2G market. That will mean more calls included in the bundles, more attractive on-network offers, and more inducements to use advanced services such as multimedia messaging and mobile data."

One bright spot identified in the report was the potential for fixed line replacement (a mixed blessing to some operators). Evans suggested that, if exploited properly by carriers with attractive bundles of on-net calls, this represented huge growth potential for mobile operators.

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