2006 Australia - Mobile Communications - Voice Still the Killer App

1. INDUSTRY MOVING INTO 2007

1.1 The mobile market - moving into 2007

1.2 Strong Vodafone performance but challenging road ahead

1.3 Hutchison still star performer but 3G arena heating up

1.4 Australian mobile market reaching saturation

1.5 Fixed-to-mobile substitution - a growing trend

1.6 3G will open up new niche revenue streams

1.7 Mobile networks not ideal for carrying data

1.8 Fixed line players move into mobile operator’s territory

1.9 3G prices will drop forcing down ARPU
1.10 The future of mobile - analysis mid-2006

1.10.1 Voice still the killer app

1.10.2 But data is the future

1.10.3 Rebalancing of the industry

1.10.4 Devices-driven developments

1.11 Goodbye Virgin Mobile

1.12 Mobile market monopolistic tendencies

1.13 How many mobile networks is too many?

1.14 Mobile structural separation needed for survival

2. REVENUE OVERVIEWS

2.1 Market moving into 2007

2.1.1 Prepaid a successful subscribers driver

2.1.2 Market maturity

2.2 Average Revenue Per User (ARPU)

2.2.1 Continuing decline

2.2.2 ARPU per operator

2.3 Revenue tables

2.4 Market shares

3. SUBSCRIBER STATISTICS

3.1 Size and dimensions of the market

3.2 Market shares major players

3.3 Key trends and developments

3.3.1 Lower than expected growth for 2006 and 2007

3.3.2 More usage as call charges drop

3.3.3 Slow growth in 3G

3.3.4 Mobile data waiting for new business models

3.3.5 Approaching penetration limits

3.4 Residential markets

3.4.1 Overview

3.4.2 The Youth Market

3.4.3 AT Kearney’s ‘Mobinet’ Study

3.5 Business market

4. INDUSTRY OVERVIEW AND ANALYSES

4.1.1 Network operators

4.1.2 The initial analogue operators

4.1.3 2G operators

4.2 3G

4.3 Service providers and resellers

4.3.1 Overview

4.3.2 Resellers on the Telstra network

4.3.3 Resellers on the Optus network

4.3.4 Resellers on the Vodafone network

4.4 Mobile Virtual Network Operators

4.4.1 Definition

4.4.2 Introduction

4.4.3 MVNO initiatives from Optus

4.4.4 dingo blue first to unbundle handsets (post mortem)

4.4.5 Virgin Mobile (post mortem)

4.4.6 Macquarie Telecom

4.4.7 CommodiTel

4.4.8 Analysis of MVNO developments

4.5 Retail operators

5. INDUSTRY DEVELOPMENTS

5.1 3G auctions

5.1.1 Telstra

5.1.2 Optus

5.1.3 Vodafone

5.1.4 Optus/Vodafone sharing arrangements

5.1.5 Hutchison 3G

5.1.6 CKW Wireless (Personal Broadband Australia)

5.1.7 IPWireless for Townsville

5.1.8 3G Investments (Qualcomm)

5.2 4G Research

6. INFRASTRUCTURE DEVELOPMENTS

6.1 Trends and developments

6.1.1 How many mobile networks is too many?

6.1.2 Mobile structural separation

6.1.3 Mobile phone infrastructure code improved by ACMA

6.1.4 Network sharing - an obvious step in the right direction

6.1.5 Sharing announcement 2

6.1.6 Other infrastructure developments

6.2 GSM Infrastructure Providers

6.2.1 Telstra MobileNet

6.2.2 Optus Mobile

6.2.3 Vodafone Australia

6.3 Other networks

6.3.1 Cocos (Keeling) Islands

6.3.2 Norfolk Island

6.3.3 Christmas Island

6.4 Code Division Multiple Access (CDMA) networks

6.4.1 Telstra

6.4.2 Hutchison - Orange

6.5 3G Infrastructure

6.6 IP Multimedia Subsystem (IMS)

6.6.1 Introduction

6.6.2 Partnership to promote IMS technology

6.7 Analogue network

6.7.1 Historic overview 1987-2000

6.8 Mobile sites infrastructure

6.8.1 Overview

6.8.2 Network partnering trial

6.8.3 Telecoms and the real estate market

6.8.4 Crown Castle

6.8.5 Vertical Telecoms (Vertel)

6.8.6 Entire Network Solutions

6.8.7 Industry taskforce for co-location

6.8.8 Deployment of Radiocommunications Infrastructure Code

6.8.9 Court limits carrier’s powers and immunities

7. THE END OF CDMA

7.1 The end of Telstra’s CDMA network

7.1.1 Closing down costs $800 million

7.1.2 CDMA resellers left out in the cold

7.2 Hutchison closing its CDMA network

7.3 CDMA spectrum

7.4 Telstra

7.4.1 National CDMA network

7.4.2 1xRTT

7.4.3 CDMA extension on highways

7.4.4 Flinders Island

7.4.5 The Nortel connection into WiFi

7.5 Hutchison’s Orange network

7.6 Optus resale

7.7 AAPT (no service)

7.8 CDMA resale

7.9 Market and industry analyses

7.9.1 Telstra questions CDMA

7.9.2 Australia is a GSM country

7.9.3 Low cost alternative

7.9.4 Hutchison flawed Wireless Local Loop (WLL) concept

7.9.5 Wireless broadband

7.10 Forecasts and statistics

8. 3G - OVERVIEW, STATISTICS, ANALYSES

8.1 Statistical overview

8.2 Market Analyses

8.2.1 WiMAX for 4G

8.2.2 Increased awareness of 3G - but ….

8.2.3 Discount war drives down 3G ARPU

8.2.4 3G is dead - long live WiMAX

8.3 Network sharing and cost cutting

8.3.1 Network sharing

8.3.2 Where is the business case?

8.3.3 Network costs will be driving 3G

8.3.4 New business scenarios

8.4 Analysis of Australia’s first 3G launch

8.4.1 3 Australia a good start but…..

8.4.2 Positioning for the next five years

8.4.3 Further price initiatives needed soon

8.5 Business modelling

8.5.1 New business models needed

8.5.2 Damned if you do, damned if you don’t

9. RETAIL MARKET DEVELOPMENTS

9.1 Overview of the dealer market - 2006

9.1.1 Market statistics

9.1.2 Increase in sophisticated retail models

9.1.3 The industry reorganisation of 2005

9.2 Retailer market analysis - update 2006

9.2.1 Retail margin continues to be squeezed

9.2.2 Replacement market: 7 million

9.2.3 Market segmentation

9.3 Key retail operators

9.3.1 Strathfield Car Radio

9.3.2 Crazy John’s (Mobile World)

9.3.3 Tandy, Dick Smith, Harvey Norman

9.3.4 Leading Edge Telecoms

9.3.5 Fone Zone

9.3.6 Allphones

9.3.7 M8

9.3.8 First Mobile National Ltd

9.4 Retail outlets carriers

9.4.1 Telstra T-shops

9.4.2 Optus World

10. THE GROWING PREPAID SERVICES MARKET

10.1 The market in 2006

10.2 Developments and issues

10.2.1 Customer demand

10.2.2 Prepaid now well established

10.2.3 How competition changed the market (history)

10.2.4 Trends towards user-power

10.2.5 Prepaid Electronic Payment Services

10.2.6 Handset subsidies

10.2.7 Fast moving consumer goods

10.3 Market statistics

10.3.1 Overview

10.3.2 Market revenues

10.4 Business models

10.4.1 Card and PIN

10.5 Major players

10.5.1 Telecorp

11. PREPAID ELECTRONIC PAYMENT SERVICES MARKET

11.1 Introduction

11.2 Market forecasts

11.2.1 Mobile prepaid

11.2.2 Calling cards

11.3 Market overview

11.3.1 Retail outlets

11.3.2 Card and PIN

11.3.3 Distribution issues

11.4 Recharge models

11.4.1 Automatic Teller Machines (ATMs)

11.4.2 Electronic Funds Transfer Point of Sale (EFTPOS)

11.4.3 Multiple-use terminals

11.4.4 Integration onto POS PC screens

11.4.5 Telephone

11.5 Trends and developments

11.5.1 New electronic recharge cards

11.5.2 New markets

11.6 Revenue overview

11.7 Major players

11.7.1 E-pay Australia

11.7.2 Bill Express Limited

12. PRICE COMPETITION

12.1 Substitution, capped prices, FMC

12.1.1 Mobile substitution

12.1.2 Capped Prices

12.1.3 Market Analysis - 2006

12.1.4 Fixed Mobile Convergence

12.2 Termination, fixed-to-mobile charges

12.2.1 Mobile services prices - ACCC survey

12.2.2 National mobile termination fees

12.2.3 FtM analysis

12.2.4 History of the disputes

13. HANDSET MARKET

13.1 The market in 2006

13.1.1 Trends in mobile handsets

13.1.2 Outlook for 2007

13.2 Mobile handset survey - 2005

13.3 Handset subsidies

13.3.1 Unsustainable handset subsidies

13.3.2 Several Attempts to do away with subsidies

13.3.3 Reintroduction forced by competition (2003)

13.3.4 Failed unbundling attempt from Dingo Blue

13.4 Handset sales statistics

13.4.1 Replacement market

13.4.2 Changing trends

13.5 User demographics - 1998, 2000

13.6 Handset costs

13.7 Key players in Australia

13.8 Mobile phones targeted by viruses

14. GLOSSARY OF ABBREVIATIONS

Exhibit 1 - Mobile carriers and their key resellers

Exhibit 2 - Boost Tel

Exhibit 3 - MVNO models

Exhibit 4 - MVNO Opportunities

Exhibit 5 - Vodafone Live!

Exhibit 6 - Crown Castle

Exhibit 7 - Operators and their markets

Exhibit 8 - Ozphone

Exhibit 9 - Network costs

Exhibit 10 - Crazy John’s billing problems

Exhibit 11 - Key customer considerations

Table 1 - Australia - 3G subscribers- mid-2006

Table 2 - Vodafone Group subscriber and revenue growth - Australia vs selected countries - 2005 - 2006

Table 3 - Blended (post/pre) ARPU ($ pa) by operator - 2003 - 2006

Table 4 - Blended (post/pre) ARPU ($ pa) by operator - 1998 - 2002 (historical)

Table 5 - ARPU per market segment (residential, SME, corporate) - 2004

Table 6 - Average ARPU across all operators - 1993 - 2007

Table 7 - Telstra average revenue per user per month - 2003-04, 2004-05

Table 8 - Optus average revenue per user per month - 2003-04, 2004-05

Table 9 - Vodafone average revenue per user per month - 2003-04, 2004-05

Table 10 - Hutchison average revenue per user per month - 2003-04, 2004-05

Table 11 - Revenues, mobile communications services market per major operator - 1993 - 2007

Table 12 - Market share revenues percent of mobile operators - 2000 - 2007

Table 13 - Revenue growth mobile market - 2000 - 2007

Table 14 - Mobile market subscribers, penetration and annual change - 1986 - 2008

Table 15 - Mobile subscribers by carrier - 1993 - 2006

Table 16 - Market share (%) by carrier - 1998 - 2006

Table 17 - Mobile digital subscribers by carrier - mid 2006

Table 18 - Market shares of customers for mobile carriers - 2002 - 2005

Table 19 - Increase in customer numbers for mobile carriers - 2002 - 2005

Table 20 - Revenue market share per market segment (corporate, SME, residential) - 1994 - 2007

Table 21 - Net subscriber growth per segment (corporate, SME, residential) - 1994 - 2005

Table 22 - Market shares of business market per major operator - 2005

Table 23 - Terrestrial mobile network coverage - 2002; 2005

Table 24 - Dimensions of MobileNet - AMPS - 1993 - 1996 (now closed)

Table 25 - Number of base stations by operator - 2006

Table 26 - Subscribers to 3G networks - 2003 - 2006

Table 27 - 2G, 3G Average ARPU per month comparison - 2006

Table 28 - Distribution channels - 2006

Table 29 - Leading retailer outlets - 2006

Table 30 - Prepaid customers - 1998 - 2007

Table 31 - Prepaid and postpaid retail customers - 30 June 2005

Table 32 - Prepaid market shares - 1999 - 2005

Table 33 - Market revenues prepaid - 1997 - 2007

Table 34 - Market share electronic payments of total prepaid - 2002 - 2006

Table 35 - Electronic payment market revenues - 2005

Table 36 - Electronic payment market revenues - 2006

Table 37 - Major electronic payment providers and their market share

Table 38 - Substitution forecast 2004 - 2010

Table 39 - Percentage change in mobile services index by user group - 2004 - 2005

Table 40 - Percentage change in price indexes for mobile services - 2000 - 2005

Table 41 - Revenue market shares FtM - 2003 - 2005

Table 42 - ACCC Mobile Review - 2003

Table 43 - Retail benchmarking monitoring mobile services - 2001 - 2003

Table 44 - Mobile Phone Shipment - 2005 - 2007

Table 45 - 2005 Handset Sales by Technology

Table 46 - Mobile phones by family type - 1998; 2000

Table 47 - Mobile phones by household income - 1998; 2000

Table 48 - Mobile phones by state - 1998; 2000

Table 49 - Mobile phones metro vs. regional - 1998; 2000

Table 50 - Average mobile phone cost - 1986; 1993; 1998 - 2000; 2006

Table 51 - Mobile handset supplier market shares (digital) - 1999; 2001; 2003; 2005