Mobile services market is turning around
After declines due to the coronavirus pandemic, Australia’s mobile market is set for a huge come back. Analyst firm GlobalData has released a report predicting a 15.4 percent growth in the Australian mobile market by 2025, targeting $14.9bn in revenue.
The growth drivers include both mobile voice and data services. The report also predicts slight growth in fixed communications revenue by 2025.
Here’s a closer look at the report:
GlobalData predicts 5G growth
Just last year, the mobile market was facing declines. Telstyle analysts predicted another drop in revenue, and this did not come as a surprise given the effects of COVID-19.
Things are turning around now, according to GlobalData’s analysis. Here’s a breakdown of their forecasts:
- Mobile market will see a of 15.4 percent Compound Annual Growth Rate (CAGR) by 2025
- Mobile services revenue will reach US$14.9bn by 2025
- Mobile voice services to grow at 12.7 percent CAGR between 2020 and 2025
- Mobile data services to grow 16.7 percent CAGR between 2020 and 2025
- 5G subscriptions to grow from 5.7 percent to 34.7 percent between 2020 and 2025
- Fixed communications services revenue, on the other hand, is expected to grow only 0.7 percent CAGR between 2020 and 2025.
While mobile service in general are predicted to grow significantly, fixed services are only expected to see minor growth. This says a lot about wireless communications, especially with modern wireless network technology.
And while mobile voice services will grow at an impressive rate, mobile data will have even more growth. Analysts predict this will have a lot to do with the 5G rollout, as more Australians will subscribe to 5G plans in the coming years as telcos rollout the technology at a faster pace, and the government allocates new spectrum to make 5G even faster.
5G to experience massive growth
A lot of great things are happening with 5G, and we expect more to come. Higher spectrum will be auctioned off soon by the government, and we’ll talk more about that below.
These improvements will result in more subscriptions as the technology differentiates itself from current LTE networks with faster speeds. And as coverage expands during the rollout, more subscriptions will pour in as well.
As stated, Global Data forecasts an increase from 5.7 percent to 34.7 percent of mobile data subscriptions to be 5G subscriptions between 2020 and 2025. That is a huge leap that could even challenge 4G plans and begin to wipe out 3G networks.
In fact, Telstra, the largest telco in Australia, has announced its plans to get rid of 3G by 2024, leaving more spectrum and bands available for more 5G expansion.
Why 5G will drive mobile data growth
The 5G rollout is only 2 years old. That’s right, it was just 2 years ago that Optus and Telstra turned on commercial 5G sites in Australia, and yet we’ve seen some great progress so far.
Today, Telstra has the widest 5G coverage with 50 percent of the population already. The telco plans on increasing that coverage to 75 percent by the end of June.
And with the Australian government set to allocate 5G spectrum in the 26GHz band in the first half of this year, the mobile network technology is expected to get even faster. This mmWave technology will begin the transition to the 5G we had heard about long before launch, which was expected to see speeds of up to 100 times that of LTE networks. And with the government also expected to allocate lower band spectrum throughout the country later this year, 5G coverage is expected to widen as well.
Last year was rocky for the telco market. From declines in revenue to network outages, the mobile services market was tested. But what we’ve learned so far is that Australia’s mobile market is resilient. Analysts forecast huge growth in the coming years, an about-face from consecutive years of decline. Mobile data will contribute significantly to this growth, thanks to the power of 5G.