Australian Mobile Market Takes Major Hit From Coronavirus

SYDNEY: Mobile services revenue in Australia could decline by 10 percent in 2020, and sales of the much ballyhooed new “5G” gear could take a special hit, due to both industry pressures and – natch! – the coronavirus situation, according to a new report by Sydney-based analyst company Telsyte.

The report claims that the total number of services in operation, or SIOs, across Australia could decline for the first time in a decade.

That’s quite a turnaround. Telsyte Australian Mobile Services Market Study 2020, now available, found the market grew by 332,000 SIOs for the six months ended December 2010 – before the coronavirus began spreading across Australia. 

Annual services revenue for the 12 months to December 31 was down 4.1 percent at $13.38 billion.

Now, with the pandemic extending across Australia, Telsyte estimates that mobile services revenue could decline by a further 10 percent by the end of 2020. That’s due to a potential slowdown in new SIOs; lower ARPU (average revenue per user); and a major reduction in international roaming revenue as a result of travel bans, Telsyte says.

However, there is some light filtering through the tunnel. Telsyte also estimates that Australia’s mobile virtual network operator (MVNO) market is continuing to buck the trend, adding 265,000 services, compared to Telstra (up 159,000), Optus (up 104,000) and VHA (down 196,000).

And it notes that MVNOs such as Amaysim, Aldi Mobile and new entrants Circle.life and Nu Mobile have all benefited from consumers looking for better deals.

But Telsyte also forecasts a probable slow uptake of much ballyhooed “5G” smartphones. It believes the slowing economy will see consumers deciding to wait for the later arrival of cheaper 5G handsets.