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Data Demand: Telcos In Data One-Upmanship Amid Battle For Market Share

Data Demand: Telcos In Data One-Upmanship Amid Battle For Market ShareAustralian Bureau of Statistics (ABS) figures released last week showed data downloads in the three months to December 31 exceeded 1.1 million terabytes (1 exabyte), up 33 per cent on last year’s corresponding quarter and 15 per cent on the previous quarter.

Meanwhile, the year-on-year increase in data downloaded via mobile handsets jumped over 90 per cent, from 27,627 terabytes up to 52,745 terabytes.

By any measure the growth is steep, and telcos are racing each other to cater to customers’ high data demand.

There has been a spate of announcements in recent weeks related to data plans, with Optus today launching its Family Sharing offering.

Under Family Sharing, customers who sign up for Optus’ new postpaid mobile plans will be able to combine all their household’s mobile phone plans on one bill, pooling all data inclusions, and receiving unlimited standard national talk and text, and unlimited standard international text.

“All families have different data needs, with some people in the house using more than others – now customers can combine all the mobile plans in their home on the same bill and make the most of their data,” Vicki Brady, Optus managing director, marketing and product, commented of the initiative.

The new offer comes hot on the heels of a number of a deals revolving around the imminent release of Samsung’s new flagship Galaxy S6 smartphone, with both Optus and Telstra looking to woo customers with data incentives.

Telstra has announced it is boosting some of its most popular mobile plans with more data and a bonus six-month subscription for the TV and movie streaming service Presto.

Telstra has also announced Extra Data, set to launch on May 12, providing eligible customers the option to receive additional data in 1 GB blocks when they reach their monthly data limit at a flat rate of $10 per block.

“Instead of counting megabytes, Extra Data will allow our customers to focus on the things they really love about using their mobile on our network – like streaming, sharing, browsing and connecting in more places,” Telstra retail group executive Gordon Ballantyne stated of the initiative.

“And if they want to continue to share, stream and download once they reach their plan allowance, they can do so without having to worry about unexpected data charges or contacting us to add a data pack.”

The video streaming market is another focus area for telcos.

While Telstra is offering the six-month Presto subscription, Optus is also looking to capitalise on the growing market, offering customers who pre-order the S6 or S6 edge on a 24-month contract with a $60 per month or above plan six months of Netflix with data usage excluded.

Meanwhile, Virgin Mobile is looking to attract customers with its Data Rollover feature for new postpaid mobile plans, which launched in March.

Under Data Rollover, data not used in the last month’s data inclusion will rollover into the next month.

“Data Rollover will revolutionise how Australians view their telco’s data offering and will change the mobile industry for good,” Virgin Mobile CEO David Scribner stated of the initiative.

“People are hungry for data and it’s not fair that something they’ve paid for is snatched away after a month – they should get another chance to use it. I’m proud to say that we are the only telco rescuing people’s data.”

Virgin Mobile has announced it will be offering Data Rollover with its new S6 and S6 edge postpaid plans.

Earlier in the year, Vodafone announced its “weekend freedom initiative”, offering unlimited weekend data on selected prepaid caps.

“We want to empower our prepaid cap customers to gain more confidence about their data use while having some fun doing the things they love to do on their smartphones,” Vodafone chief marketing officer Loo Fun Chee commented of the initiative.

“Last year our free data and international calling weekends saw our customers break usage records. They really showed us how much these services are a big, huge passion point for them.”

Telcos, however, could see revenue impacted as a result of the increasingly competitive offerings.

As reported by the Herald Sun, Morgan Stanley analyst Mark Goodridge has stated while Telstra is making the move to protect its market share, this would reduce future data monetisation “and hence reduces top-line revenue growth”.

Morgan Stanley is forecasting average revenue per user growth will fall to 3 per cent in 2015-16, down from the current 5 per cent, the Herald Sun reported, with overall mobile revenue growth tipped to fall from 8 per cent to 4 per cent.

The Australian Financial Review last week reported Telstra retail group executive Gordon Ballantyne as stating he does not believe the impact on revenue will be material.

“I don’t see this materially impacting revenue because I think it’ll encourage customers and we’ll see an expansion in the market of those revenue pools,” the AFR reported Ballantyne as stating.

“If we act on what [customers] want, then revenue will follow. We just see exponential demand for video and those other services.”