news The nation’s largest telco Telstra has continued its incredibly strong drive to take back a huge slice of Australia’s mobile market, adding 739,000 customers in a period in which both Optus and Vodafone appeared to go slightly backwards.
The telco — whose Next G network has long enjoyed significantly broader coverage and often speeds than the networks of its competitors, following an early entry into both 3G and 4G services — this morning revealed it had added a further 739,000 customers to its mobile network in the six months to the end of December 2013, taking its total customer base to 15.8 million services.
The company now has some 4.1 million mobile devices on its 4G network, including some 2.9 million handsets and 1.2 million wireless broadband devices.
The figures compare extremely favourably to those of its rivals. Optus this morning revealed it had lost 57,000 customers over its most recent quarter, bringing its total mobile customer base to some 9.43 million. The company’s overall mobile revenue sank by seven percent in the quarter, although it added some 429,000 4G mobile connections in the quarter to take its total to 1.81 million.
Worst of all is Vodafone. The company revealed last week that it lost some 22,000 customers in its final quarter of 2013, meaning that it has just five million customers after it lost around 2.5 million in its infamous ‘Vodafail’ episode. Vodafone recently announced that it had passed the one million customer level on its 4G network, which offers higher speeds in some areas but significantly smaller coverage compared to the networks of both Optus and Telstra.
According to ZDNet, Telstra chief executive David Thodey crowed at Telstra’s financial results briefing session today regarding the company’s mobile infrastructure. “”We now have 3,500 4G mobile base stations switched on and working around Australia,” the CEO reportedly said said. “[It is] four times larger than any other comparable network in Australia.”
The news comes as debate continues about the extent to which Vodafone will be able to ride out its customer loss storm and re-enter the mobile market as a competitive force, and about to what extent Optus remains a viable competitor to Telstra in the mobile arena. Telstra has added millions of customers to its mobile network over the past several years, siphoning many from Vodafone, while Optus’ customer count has remained largely stagnant in that period.
However, all three telcos continue to plough hundreds of millions of dollars into mobile infrastructure, particularly in the area of 4G support, where a race is currently taking place to blanket the nation with mobile towers supporting the new standard, using various wireless frequencies.
I’ve been warning for a long time that Telstra is killing competition in Australia’s mobile industry. In June 2012 I wrote:
“Right now, when it comes to mobile, Telstra holds all the cards in Australia, and it is playing those cards for all it is worth; rapidly soaking up hundreds of thousands of customers, destroying Vodafone’s revenue stream wholesale, and holding Optus back with one hand while it’s raking in cash with the other. It has the best handsets, the best network, the most marketing clout, the best reputation for network quality and a colossal lead in 4G infrastructure.
Now, from a customer viewpoint, there is no doubt this is fantastic — for now. Telstra is bending over to make customers like myself happy, and I’m happy to admit I’m a Telstra mobile customer. There is simply no point for someone like myself (who needs access to the Internet pretty much 24×7, anywhere I am), to sign up with Vodafone or Optus, when I know I’m going to get reduced coverage and speed from the alternative networks for only a slightly cheaper cost. And Telstra has been the only mobile carrier I recommend to anyone who asks for years now.
But long-term, what Telstra is doing right now represents a troubling sign for Australia’s mobile industry. Just as it did in fixed broadband, Telstra is now winding back competition in the mobile telecommunications space. One really has to wonder how long multinationals like SingTel and Vodafone will continue to be committed to piling hundreds of millions of dollars into mobile phone infrastructure in Australia, when it is clear they are only going to see very moderate levels of growth in return — and are even going to have to struggle to keep what customers they have. And who will keep Telstra honest with strong competitive offerings, when the company gets too far ahead for its own good?
In five years’ time, just how much market share will Telstra have in Australia’s mobile phone industry? If it keeps on adding 900,000 new mobile connections every six months and converting its customers to 4G while its rivals do diddly squat, I would have to say the answer will be: Most of it.”
In comparison to when I wrote that, a year and a half ago, the situation appears to have stabilised a little at the moment, with Optus and Vodafone at least holding relatively steady. In addition, both have continued ploughing hundreds of millions of dollars into their mobile networks.
This is very good news for Australian consumers. Sure, Telstra is still massively growing its mobile base, while the others aren’t. But compared to a year ago, when it appeared Vodafone was on the brink of folding and that there was no way Optus was going to be able to keep up with Telstra’s 4G network rollout, thinks are looking significantly up. Optus’ 3G and 4G infrastructure is now pretty good and definitely competitive to Telstra’s, while Vodafone is at least not losing hundreds of thousands of customers every quarter any more, and has actually taken the 4G speed lead in some city areas.
Let’s hope the good news keeps on going and that both Vodafone and Optus get back to their feet in the mobile scene. We can’t afford to let Telstra have its own way in this area for ever.
Image credit: Telstra