John Linton ....it is the only moment in the year when some form of truth (as long as you only look at the figures) replaces the rest of the year's flood of mis-information.
The ASX reports by Optus and Telstra yesterday made interesting reading - Telstra reporting a fall of almost 5% in annual profit and Optus reporting an increase of 22%. Telstra ascribing much of its fall to a loss of some 325,000 wire line customers:
http://www.smh.com.au/business/end-of-the-line-for-giant-telstra-as-markets-stall-20100812-121g0.html?autostart=1
and Optus ascribing its very, very strong growth to significant increase in mobile customers and very strong growth in mobile broadband. Vodafone had previously reported very strong growth and attributed 40% of its mobile revenues to data services. While I realise that taking a simplified set of numbers at one point in time isn't all that indicative of what might happen in the future it IS some real facts among a huge amount of wild and uninformed speculation about the viability or otherwise of the 'NBN2' and the obvious ignoring of directions of communications technology use in Australia.
Take the unequivocal and simple statement by Telstra that over the past year some 325,000 residential premises turned off the wire line telephone and, presumably, substituted that telephone usage for mobile. (bringing the percentage of such residences to around 12% and growing at an inceasing rate). Apart from the damage those actions did to Telstra's profit in the last financial year what does it mean? One of the things it could mean is that people who rent on a short term basis no longer see the expense of activating a telephone as being cost effective since they use their mobile for making the few telephone calls now needed in many people's lives.
What do those people do for internet? Unless you make the assumption that they don't use internet while they are at home you would have to conclude that they also use their mobiles for internet services. Both the US carriers and Vodafone in Australia report that data revenue now accounts for more than 40% of total revenue from mobile services and that they expect that percentage will increase to over 50% in the first half of calendar 2011. Is it likely that such a strong and obvious growth trend will stop at 50%? I would have thought that was highly unlikely and that the trend for mobile users to increase their mobile internet use will continue to increase. What does that mean for wire line ('NBN2' fibre)?
According to the Australian communications media and the no-nothing commentators generally (who seem to be now suggesting that the national 'NBN2' will deliver 1 gbps speeds before a spade has hit the ground in anger) wireless will never be a serious medium to deliver data to residential customers of internet services. I wonder how they explain away Telstra's figures of a continuing increase of residences without land lines and the continuing increase of the use of mobile devices for internet usage? I mean - they seem to be actual facts showing trends that are undeniable. What "fact" is offered to support the view that "wireless will never be suitable"? None? Wishful thinking? Nonsensical statements pulled out of wherever nonsensical statements are pulled from? Maybe more people will begin to question those statements over time - but given the general and overwhelming stupidity of people who make such comments - perhaps not.
It seems likely that all of the mobile companies in Australia will continue to offer faster mobile data services at ever lower prices and that more rather than less people will see the wire line financial mill stone at its ever increasing prices something their personal budget neck would be better off without. Why pay $A30.00 or so to make a few voice calls (at ridiculously expensive prices) when you have no need to other than it allows you to pay even more money to get access to the internet? 12% of residences don't see any need - it seems likely that percentage will only increase. The unbuilt 'NBN2' is being aimed at an increasingly smaller market.
Copyright © Exetel Pty Ltd 2010
ABN 350 979 865 46