Technology analyst firm Telsyte also says that the arrival of 5G on the Australian market is set to enable further innovation in mobile services plans and bundled services, helping create differentiation in the market for MNOs.
The Telsyte report — Australian Mobile Services Market Study 2018 — found 616,000 new services In operation were added during the six months to December 2017, ending the period with a total of 34.2 million SIOs.
And the market collectively achieved similar net growth compared to the corresponding period in 2016 (593,000), with handsets being the main driver followed by machine-to-machine connections and mobile broadband.
The study also found competition in the BYO handset market is intensifying and consumers are benefitting from much better deals across the board compared to a year ago.
And mobile network operators have substantially increased mobile data inclusions on their BYO contract plans, putting pressure on MVNOs, says Telsyte.
The average data allowance on mobile plans grew by more than 100% in 2017, while average data usage on smartphones only grew by 49%.
Consequently, Telsyte found that around half of the average data allowance per user was utilised in 2017, down from 67% in 2016.
The Telsyte research also shows, 1 in 3 (32%) of consumers still feel they are paying too much for their current mobile services, while those who have exceeded their monthly data allowance at least once during 2017 were twice as likely to intend to change their service provider than the average.
Telsyte cautions that mobile connectivity is now critical to most Australians due to slow broadband speeds.
According to the report, more than 1 in 4 Australians were forced to tether to their mobile connection in the last 12 months due to a slow, or non-working, fixed broadband connection at home or work and, amongst those forced to tether, 32% said they are likely to upgrade their mobile data limit.
However, despite this behaviour, Telsyte says that the consumption of fixed broadband data showed no sign of slowing down with usage expected to continue to grow at around 40% per annum.
And the research also found that two-thirds of Australian smartphone users with fixed broadband at home claim that they would use their fixed broadband just as much, even if they had access to unlimited (or very large) mobile data. Only 11% say they will decrease their fixed line usage by more than 50% or stop using it altogether.
Telsyte says it believes a simple unlimited “any connection” option will be popular going forward, as consumers become increasingly dependent on their digital devices, regardless of whether they connect via the mobile network, or a fixed line network.
“The market is conditioning people to consider and pay for different access technologies separately, but ultimately consumers just want their Internet to work, anywhere at any given time, on all their digital devices,” Telsyte senior analyst Alvin Lee says.
Lee says Telsyte believes more personal and household devices will be connected to the mobile networks when consumers are introduced with the “easy to connect” methods, such as those based on eSIMs.
Telsyte notes that eSIMs — integrated SIMs in digital devices such as smartphones, wearables, tablets and other Internet-connected devices — are the catalyst for disruption in the market.
The analyst firm says devices with eSIMs can be connected to supporting cellular networks with a simplified process and without requiring a physical SIM card. They also can reduce the internal space required, a critical advantage for smaller devices such as wearables – and currently the Apple Watch Series 3 LTE is the main device utilising this technology.
According to Telsyte, eSIMs are more likely to encourage Australians to connect additional devices to mobile networks.
The firm says that with the current low levels of data utilisation on mobile services, nearly 1 in 2 Australians (45%) are interested in connecting their personal and household devices to mobile networks if they are eSIM enabled – and the most immediate opportunities are with laptops and tablets where about a third of Australians are interested in connecting via an eSIM.
While eSIMs present opportunities for carriers, Telsyte concludes that they also have the potential to increase churn, with most operators still cautious in adopting this technology.