Mobiles drive digital economy

The Australian Communications and Media Authority’s Communications Report 2007-08 highlights the growing impact and importance of mobile telecommunications as a driver of productivity across the entire economy and the key role played by the technology in balancing family, work and social needs.

The Chief Executive Officer of the Australian Mobile Telecommunications Association (AMTA), Chris Althaus, said mobile telecommunications were transforming the way Australians live and work and the productivity benefits and cost reductions accruing to users of mobile phones were driving activity across all sectors of the economy.

“ACMA’s study has highlighted the role played by mobile telecommunications in promoting strong growth in the telecommunications industry and how competition and technological change have delivered lower prices, most notably in the mobile sector,” he said.

Mr Althaus said it was vital that the mobile telecommunications industry continued to have access to key infrastructure, such as radiofrequency spectrum, to meet future market demands for mobile telecommunications services, including mobile broadband.

Also, it was important that government policies did not impose overly prescriptive and unworkable burdens on business in regulatory impact or engagement costs, which were commonly reflected in additional costs to consumers.

The ACMA report’s key findings for mobile telecommunications are:

  • The number of 3G subscriptions grew by 88% in 2007-08 from 4.6 million to 8.6 million

  • There were 22.12 million mobile phone services in Australia at June 30, 2008, up from 21.26 million

  • The welfare gained by customers (consumer surplus) from using mobile telecommunications services was $3,287.80 million compared to $317.50 million for internet services. The ACMA report says the majority of the increase in the consumer surplus is attributable to changes in the mobile telecommunications sector as prices fell and subscriber demand grew

  • In estimating the consumer surplus for mobiles, ACMA calculated that mobile phone calls fell in price by 21.5% and the price of SMS/MMS decreased by 41.5%.

Mr Althaus said the ACMA figures endorsed a recent Access Economics report done for AMTA that found the mobile telecommunications industry’s indirect contribution to the economy outweighed its direct contribution, meaning the benefits created by the industry are far greater than the resources its draws from the economy.

“This contrasts with many other industries, for which the major component of the economic contribution derives from the industry’s own usage of economic resources. In this regard the mobile phone industry is shown to be punching above its weight in economic terms,” he said.

“As such, the indirect benefits from mobile voice and data, as measured by the impacts on GDP, are estimated to rise to $8.1 billion in 2008 and $9.3 billion in 2010.

“By 2010, it is estimated that the increased uptake of 3G and the consequent increase in mobile data traffic will contribute $2.1 billion towards this figure, in additional GDP over and above gains from mobile voice.”

Access Economics calculated that combining the direct and indirect contributions, the mobile telecommunications industry contributed $14.2 billion to the Australian economy. This means that the total GDP in Australia would have been $14.2 billion lower if mobile telecommunications did not exist.

Mr Althaus said the ACMA report had highlighted the important and growing role played by mobile telecommunications in the economy because the enabling technology drives productivity across all sectors, which results in its indirect contribution outweighing its direct impact on the economy.

He said the challenge for the Federal Government was to support the digital economy, which would require:

Increased levels of spectrum availability for advanced wireless services, including mobile broadband.

the continuation of consistent and integrated government policies and regulations that would facilitate, not inhibit, the adoption of innovative mobile telecommunications solutions.

For more information contact Randal Markey, AMTA, (02) 6239 6555 or 0421 240 550