By the numbers: Australia in a fixed-line fix?

By the numbers: Australia in a fixed-line fix?

Summary: New research from Nielsen shows a huge jump in Australia's mobile media consumption. This supports data from Cisco showing that mobile downloads are on the increase, but that doesn't mean we're big consumers of data overall.

TOPICS: NBN, Broadband

New research from Nielsen shows a huge jump in Australia's mobile media consumption. This supports data from Cisco showing that mobile downloads are on the increase, but that doesn't mean we're big consumers of data overall.

The Nielsen report (PDF), the Australian Online Consumer Landscape, shows that 81 per cent of Australians (aged 16+) are active online users, the fifth-highest level of internet penetration in the world. It also shows a rapid take-up of mobile devices in Australia, with 51 per cent of online users owning a smartphone. Ownership of tablet computers also doubled this year to 18 per cent (and is forecast to reach 39 per cent by 2013).

None of this is surprising. Cisco has predicted for some time that we would be fast on mobile adoption in this country. The company's Visual Network Index predicts consumer downloads from mobile devices will jump from 3.5 petabytes (3500 terabytes) in 2010 to 127 petabytes by 2015 — a 36-fold increase. By comparison the US will see a 20-fold increase over the same period.

In fact, our fascination with mobile data seems extraordinarily strong. By 2015 mobile data will account for 31 per cent of all consumer internet downloads in Australia. In the UK only 11.7 per cent of all consumer downloads are forecast to come from mobile devices in 2015; in the US and Canada the figure is projected to be just 4 per cent.

Why the big difference? It's not that the rest of the world is slow to pick up on mobile data, it's more a case that Australia has fallen so far behind the rest of the world in fixed data downloads. If we aren't consuming content at home over our fixed connections while other countries are, of course the proportion of mobile to fixed downloads is going to be higher in Australia than in those countries.

All together, if you add our fixed and mobile data consumption together and you can see (from the chart) that, when calculated on a per capita basis, we download only 12 per cent of what an average US citizen does. We'll play catch-up a little by 2015, but even then Australians will still only download one-third of what Americans do.

(Credit: Phil Dobbie/ZDNet Australia)

It's a depressing prediction for a country rolling out a high-speed fibre-to-the-home network. The UK, which is rolling things out a little faster, is expected to leap closer to the US benchmark. Unfortunately, Cisco's figures are less optimistic about the impact of the National Broadband Network. Perhaps, after the Queensland election, they're right to be pessimistic — with a change of federal government there's a chance the thing will never be finished.

The big driver of growth in data consumption is, of course, video. We'll have less of it in Australia because the constraining factor is not just the connection into the home, it's the pipes under the oceans that connect us with the rest of the world. Perhaps, if we want to keep up with everyone, that's where government money needs to go. Otherwise our influence in the global digital economy could be very small indeed — about as small as the screens on our smartphones.

Topics: NBN, Broadband


Phil Dobbie has a wealth of radio and business experience. He started his career in commercial radio in the UK and, since coming to Australia in 1991, has held senior marketing and management roles with Telstra, OzEmail, the British Tourist Authority and other telecommunications, media, travel and advertising businesses.

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  • My understanding is the UK is rolling out a fibre to the node environment. Regardless speed to market is the key to success for most service businesses. Unfortunately NBN in Australia is politically controlled and the roll out to major population areas is being delayed. Put NBN into the cities first, the take up would enormous.
    Knowledge Expert
    • Once again the anally conservative, who consider dollars more important than Aussies, can't quite grasp the concept of the NBN.

      The NBN is being built by the government to provide for all Aussies, especially those who currently 'do not have", due to private enterprise ignoring them, because these people are deemed by businesses as unprofitable.

      If we were to provide the NBN in cities (where I live) first, simply for sole monetary or conservative political reasons, we may as well just continue with the status quo of have and have nots, while the rest of the world moves into the future.
      • Beta, No that conclusion of my position is wrong. btw I do not think NBN is being built as a social service. My understanding is NBN is being built to faciliate Australia's participation in the global digital economy. Which at its most simplistic boils down to opportunity for people to make money and therefore contribute to Australia's place in the world economy.
        My view is therefore to push out NBN to the most populated centres to generate the revenue that will be needed to sustain the build out to remote areas. The opposite strategy means NBN will bleed funds for many years. That is a bad thing. I agree a risk exists that the roll out could be stopped by politian's, however at this time it would be a rash act by either party to stop the roll out.
        Knowledge Expert
        • Under your premise (which I admit is an interesting one) you must dread the possibility of an Abbott led government excluding us from the digital economy, then?
          • As much as I really dont like the Gillard, she has some good policies and some not so good. My problem with Abbott is that they dont have ANY policies that are worth their salt, which is disturbing given the political massacre that was Queensland - hes expected to be voted in. Whether this is a reflection on some of our countrymen - who are more inclined to vote conservative, purely because they dont understand that saving money all the time creates minimal growth; Or whether its just out of spite - who knows.

            In any case I believe Doubt may have hit this one on the head. We need the NBN, this we know - what really need is it in the cities first, then the rural areas. If the government had ordered this the other way around, you'd see huge take up rates, massive growth and service improvements beyond expectations.

            Unfortunately what the voting public doesnt understand is how a minority government works - so in the case of our current Labor / Green government; they were unable to bargain. The independants forced their hand into Rural > City. I just hope Tony Abbott doesnt attempt to can it out of spite - because it will be political suicide.
          • Indeed MasterT, rolled out that way would be much more financially advantageous, I think we all know this.

            But do we "just" want the NBN to be "purely a financial exercise" which must "look good first and be advantageous to those who actually need second"?

            Granted doing it this way would end some of the financial FUD being thrown at NBNCo and is normally the way pollies work (wanting things to look good first) and yes agreed, the minority aspect has played a hand.

            But regardless, this government has shown either stubbornness or resilience (you pick) in relation to what is politically prudent and what is electorally prudent.

            For example, they must believe they, under Gillard, are doing the nation proud and making the right decisions. Because electorally, they could have reinstated Rudd and they'd now be a much more popular government and a 2013 electoral chance, which the polls clearly demonstrate... they currently aren't!
          • "But do we "just" want the NBN to be "purely a financial exercise" which must "look good first and be advantageous to those who actually need second"?"

            Exactly and problem with that approach is of course the coalition clowns can then say "You are neglecting the bush with the NBN!!" anything but admit the NBN is a good idea.
            Hubert Cumberdale
          • +1
          • Hi Master T,
            I wish you would get your facts correct. The Gillard Government is not a 'Labor/Green Government' as you stated. Australian Labor Party MP's sit on the Treasury benches. The last time I looked at Federal Parliament, I don't recall seeing Adam Bandt (A.Greens), Rob Oakshott (Ind) or Tony Windsor (Ind) sitting on the Treasury benches. Both the Independents and Greens formally declared they would support the Gillard Labor Government in Parliament in relation to the passage of supply bills and to ensure the Government prevails in the event of a no-confidence motion being called. Don't fall for Tony Abbotts over the top and reckless rhetoric.
  • Hi Phil, great article. I am not sure if I agree completely with your final paragraph, I don't think that our international links are the big constraint on multimedia over fixed line. The big local caching efforts of the likes of akamai and google help mitigate against that.

    In my opinion, the biggest constraint is the media companies/content providers. Until very recently, we didn't have a lot of content to watch over the internet. Free-to-air is only just getting its act together on catch-up services (led by ABC's excellent iView) and we have no real equivalent to services like Netflix, Spotify, HBOGo, Hulu, BBC iPlayer that have been available overseas for years and have good market penetration. Locally, groups like Quickflix are just getting started, but the selection of content is poor at the moment. FetchTV and Foxtel over Xbox are also in their infancy as fully developed IPTV offerings.

    I think once current exclusivity deals for content expire, particularly deals with Foxtel/Austar, new deals may see content become available through more channels making the use of fixed line IP services for content far more attractive.
    • Totally agree!

      Australia is already a small market, and the spotty quality of Internet connections (and availability, especially in new estates) means that it's hard to invest in content, when you know not enough people will have access to it. And poor connection speeds and high prices (for some, that are stuck on Telstra-only estates) from lack of competition means even if people want to consume more data, they can't.

      But with high speed ubiquitous broadband, it will be a dream for content providers, and instead of simply following (very far behind, I might add), we might become leaders as tech companies use us as a test bed for launching high-bandwidth apps.

      So our relatively low data usage may not be an indication that the NBN might fail, quite the opposite, I think it's the exactly reason why we need the NBN.
    • I agree Daviesh, but I'm not sure we have to wait for the exclusive deals to expire. We have already seen Optus find a way to work around the sports deal by Telstra. It's the nature of the internet. Content is merely 1's and 0's once transmitted and there are people out there who will find a way to make money from them if they can, even if it means bending the rules/laws.

      I don't think the people negotiating these deals realise that the internet is global. It isn't confined to Australia and can not be policed nationally. The question needs to asked, should they be negotiating content deals at all?

      This of course has implications on the quality of content we have access to, but no one knows how all this will eventuate.

      I think the one thing that is certain is there will be a great many people out there trying to get one up on their competitors which will most likely feed inovation. Very interesting times indeed...