blog Well. It only seems like yesterday that there was speculation about whether Telstra had one million customers on its 4G network. Well, the news today is even worse for competitors Optus and Vodafone. This morning the telco’s deputy chief financial officer Mark Hall casually told Macquarie Bank’s Equities Conference that Telstra already has 2.1 million customers on its 4G network. Some sample pars from Hall’s speech:
Our customers associate Telstra with a superior wireless network. To maintain this network supremacy we are investing $1.2 billion into our wireless network this fiscal year. This will provide us with 4G coverage to 66% of the population by June this year. As part of this investment, we are broadening the scope of our 4G network by adding a second wireless frequency, 900MHz spectrum, to better cater for increasing mobile use in regional areas.
The lower frequency of this spectrum improves signal range and depth making it ideal for use in areas where improved range or signal reliability is required. We are also trialling the next generation of wireless 4G technology, known as LTE-Advanced with plans to introduce it later this year in areas with heavy traffic demand over a greater distance. LTE-Advanced uses the 900MHz and 1800MHz spectrum bands together, allowing more data to be carried faster, unlocking more capacity for growing mobile usage.
Capacity is critical for us, as over 50% of our mobile customers use a smartphone. The average Australian is now spending 12 hours per week accessing the internet on a mobile device and the majority of these customers use their smartphone to watch video content. This customer demand is driving a rapid increase in data traffic on our network.
And we are also trialling small cell networks – known as heterogeneous networks, or HetNets for short, to expand network capacity in busy locations such as city centres and sporting stadiums. This can complement our existing network by targeting high traffic areas where it would be difficult to build additional large scale base stations. We believe the investments I have just highlighted will help Telstra to maintain our network differentiation and advantage.
Our 4G network supremacy is delivering mobile market share to Telstra. Since launch in September 2011: we have grown our 4G customer base to 2.1 million customers. This includes: 1.4 million handsets; 150,000 tablets; 370,000 dongles and 225,000 wifi hotspots.
We now have 780,000 active users on our 24×7 app which is available on the iPhone, Android, iPad and on Facebook. The 24×7 app enables our customers to monitor their call and data usage, top up their prepaid account and view their bills. In upcoming releases we are planning to release additional functionality allowing customers to purchase new services from us. We will start with simple add-ons such as data packs, and progress to more complex transactions.
I don’t think I need to point out how bad this situation is for Optus, which hasn’t released yet the number of 4G customers it has, and Vodafone, which hasn’t even launched its 4G network yet. As I’ve written previously, Telstra is winding back competition in Australia’s mobile space right now. The telco’s early launch of its 4G network, Optus’ too-relaxed stance towards gaining new customers and Vodafone’s ongoing collapse has really given Telstra an incredible lead over its rivals — a lead which is only growing as time goes on. We really are seeing an incredible amount of industry shake-up in Australia’s mobile space right now.
Image credit: Telstra