Growth in mobiles and wireless broadband highlight year in telecommunications

Growth in mobile phone services and the emergence of wireless broadband technology were among telecommunications industry highlights last financial year, according to the Australian Communications Authority’s Telecommunications Performance Report 2003-04.

Tabled in parliament by the Minister for Communications, Information Technology and the Arts, Senator Helen Coonan, the annual ACA report covers the performance of carriers and carriage service providers (CSPs), and reports on consumer satisfaction, consumer benefits and quality of service.

ACA Acting Chairman Allan Horsley said mobile phone services grew by 15.4 per cent or 2.2 million to a total of 16.5 million at 30 June 2004. Growth was largely driven by prepaid services which accounted for 43 per cent of all mobile services, up from 38 last year.

“The continued popularity of pre-paid services demonstrates the value consumers perceive in having more control over mobile service expenditure and the ability to avoid lengthy contracts,” Mr Horsley said.

The ACA report had also found that wireless broadband and access to broadband services expanded during 2003-04. Wireless broadband had emerged as an alternative for providing broadband services to residential and business customers in metropolitan areas and selected regional centres.

Broadband Internet subscribers reached over 1 million at 30 June 2004, an increase of around 103 per cent from 30 June 2003.

Compared to the growth in mobile phone services, fixed telephone services remained relatively stable with approximately 11.7 million fixed telephone services operating at the end of June 2004.

Mr Horsley said the report identified a significant change in the way services were delivered to consumers, with a number of carriers and CSPs announcing plans to provide fixed telephone services using Internet Protocol (IP) technology.

“While IP-based telephony, often in the form of voice over Internet protocol, has been offered to corporate customers for some years, its availability was extended to residential and small business markets during 2003–04,” he said.

The performance report also revealed that the trend to industry consolidation over the last few years showed signs of reversal. In 2003-04, membership of the Telecommunications Industry Ombudsman (TIO) scheme increased by 15 per cent.

Consumer satisfaction with the performance of telecommunications carriers was mixed during 2003-04 with satisfaction higher for internet services than for fixed or mobile services.

Mr Horsley said the performance of the major carriers in connecting new phone services and repairing faults against the Customer Service Guarantee (CSG) timeframes had generally remained stable at or above 90 per cent of fault reports and service connection requests completed within CSG standard timeframes at a national level compared with previous years.

Of those Telstra services that missed CSG connection timeframes during 2003–04, 93.5 per cent were connected within five days of the connection timeframe.

Mr Horsley said a particular focus of the ACA during the year had been on the remaining 6.5 per cent of services that missed this timeframe which were considered to be ‘extreme cases of failure’. The vast majority of these connections were made within 10 working days of the CSG timeframe.

The first full year of reporting by Telstra under the Network Reliability Framework, showed an average of 99.11 per cent of services on Telstra’s network did not experience a fault for each month in 2003–04. On an annual basis, around 90 per cent of services were fault free during 2003–04. For services that did experience a fault during 2003-04, the monthly average time that services were unavailable was 51 hours.

Telstra had also made improvements to 54 of the worst performing exchanges in 2003–04 at a cost of more than $10 million.

Mr Horsley said while Telstra’s performance in meeting specified timeframes for the repair of payphone faults improved in 2003–04, the ACA considered the performance was low in remote areas, where only 72 per cent of payphone faults were repaired within the required timeframe.

“Telstra is working with the ACA on a strategy for improving its payphone fault repair performance,” he said.

According to the report, progress was made in the self-regulatory framework in 2003–04 with six new industry codes under development and four new codes registered. A total of 21 codes were registered at 30 June 2004. However, the number of code signatories declined in 2003–04.

The ACA’s report said that compliance with currently registered codes was generally satisfactory but raised concerns about a number of code breaches associated with advertisements for telecommunications products and services. This was the subject of an ACA review during 2003-04.

The ACA requested that the Australian Communications Industry Forum (ACIF) develop three new industry codes in 2003-04.

The performance report also highlighted the rapid emergence of security and spam risks confronting users across a variety of services and applications and the ACA’s role in enforcing new spam legislation.

“By the end June 2004, three months after the Spam Act came into force, the major known spammers in Australia had stopped operating,” Mr Horsley said.

The report also included a summary of a recent study commissioned by the ACA which estimates that the Australian economy is $10.4 billion larger in terms of total production than it would have been without the reforms to the telecommunications regulatory regime since 1997.

The primary driver has been improvements in the productivity of the telecommunications industry which have delivered ongoing benefits to consumers and small business including:

- creating around 29,000 extra jobs in the Australian economy, and
- real private consumption benefits of approximately $5.5 billion for all households

Note: Some data was provided late by individual carriage service providers and for this reason was not included in the report. The ACA will follow up with individual companies on data provision processes and general compliance issues.

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