Introduction the mobile subscribers. The company which was


Background information of the industry

The Australian telecommunication industry is expanding very rapidly given that 99% of the population owns a mobile handset. Over 25 million Australians have subscribed to one of the major mobile phone operators.

With the advancement in technology, the industry has seen major changes and new entrants in the industry. However, the major key players of the mobile Australian telecommunication industry include Telstra, Optus, Vodaphone, and Virgin Mobile. The service providers have a market share in the same order as they appear.

We Will Write a Custom Essay Specifically
For You For Only $13.90/page!

order now

With the introduction of new hardware like the Smartphones, iPhones and other applications, mobile broadband has become popular. The mobile services have so far increased far compared to SMS and voice usage. The Australian Communications and Media Authority is the major regulator in the industry (Access Economics Pty Limited 2010, p.10). The organization ensures that the market operators comply with the set regulations and requirements.

Some of the ACMA responsibilities include licensing, ensuring that the operators complies with regulations, monitoring performance, and giving reports on matters related to the communication industry (Access Economics Pty Limited 2010, p10). Based on the Access Economics Pty Limited (2010, pii) “mobile telecommunication industry contributed $17.4 billion to the Australian economy” in the financial year 2008-2009.

History of the service provider

The leading service providers in the Australian mobile communication industry are Telstra, Optus, Vodaphone, and Virgin Mobile.


Telstra dominates the Australian telecommunication industry with 99% of the mobile subscribers. The company which was owned by the government before its privatization offers the best network coverage despite its high charge rates. The company also owns and manages the largest share of copper network in Australia (Telstra n.d).

Its services are in broadband, mobile, and landline. The company was founded in 1901 under the name Postmaster-General’s Department (Telstra n.d). It was then operated by the Australian Federation and it managed the postal, telegraph, and domestic telephone services. It was the only company in the telecommunication industry thus enjoying natural monopoly.

Through the telecom, the company established the first mobile based network in Australia in 1981 as the Public Automatic Mobile Telephone System (Telstra n.d). It was later renamed the Australian Telecommunication Corporation. The company underwent several changes such as branding and mergers until it changed its name to Telstra in 1997(Telstra n.d).

Because of the emerging key players in the Australian telecommunication industry the company was privatized in 1997. Currently, the company provides mobile services to an estimated 12.2 million Australians, which is almost 50% of the whole Australian market share. However, because of increased competition from other service providers, the company market share has reduced in recent years compared to the early 2000’s.


Initially, the company which was founded in 1981 was referred to as Aussat Pty Ltd. It is a subsidiary of the Singapore telecommunication. It is located at Melbourne, Australia with its operations in Adelaide. The company is ranked as the second service provider with interests in broadband, mobile and landline services (Optus n.d).

Although the company owns most of its network infrastructure, it uses the network of other providers especially that of Telstra wholesale. The company has been undergoing numerous branding with the aim of changing its corporate strategy and culture. As of 2008, the company had over 10, 000 employees with a revenue of 8.321 ASD dollars. The network coverage of the Optus covers 97% of the Australian population. The company offers low rates compared to Telstra which makes it affordable and cheaper.


Vodafone, which is a subsidiary of the Vodafone Plc UK, was founded in 1992 and licensed in the same year ( 2011, p3). With regard to the Australian population, the company has coverage of 94 % ( 2011, p3).

It GSM mobile services are provided between 900MHZ and 1800HMZ. In the metropolitan area, the company covers an average of 10% of the regional centers. The company was operating singularly until 2009 when it merged with the Australian based operator Hutchison 3G to form the Vodafone Hutchison Australia Pty Ltd (Bingeman & Lee 2010).

Vodafone mobile has the largest share of the mobile infrastructure in Australia although its coverage is believed to be poor. Generally, Vodafone is ranked as the cheapest service provider in Australia although its coverage is not reliable and coverage is poor ( 2011, p. 3-6).

Virgin mobile Australia

This is the youngest of the other service providers and is ranked fourth in the Australian telecommunication industry. The company was founded in 2000 with its major headquarters in Sidney, Australia. Unlike the other operators, VMA operates under a 50/50 operation where Optus and Virgin Mobile UK owns half of the business. In most case it operates under the Optus network although other operations like billing, customer services, and branding is entire the work of the VMA.

In 2005, the joint venture operations saw Virgin Mobile UK gain 74.15% of the business operations making it the largest shareholder. Although the company operates using the Virgin brand, since 2006, it was wholly owned by Optus (). It now operates as a subsidiary of the second largest service provider Optus. VMA sponsors some local activities in Australia as part of corporate social responsibility.

Current state of the environment

The current mobile telecommunication environment in Australia is competitive and saturated as there have been other new entrants in the market. However, Telstar, Optus, Vodafone, and VMA are the largest services providers dominating the industry. Compared to the last decade, the current environment has developed faster.

The number of mobile telecommunication subscribers has also increased spontaneously. The current financial crises in Europe and the U.S have adversely affected the sector. Currently, it is hard for new entrants to join the market because of high capital requirements for the establishments of network infrastructure (Access Economics Pty Limited 2010, p. 9).

Given that an organization can contain all the initial costs requirements, it still remains hard for it to penetrate the industry. This is as a result of the high dominance in the Australian Mobile telecommunication industry by the four major players. The day to data technological change acts a barrier to new entrants (Access Economics Pty Limited 2010, p.9).

For instance, a mobile telecommunication company may find the technology they are adopting for operations is phased out before the launch process is completed. Lastly, the merger between Vodafone and Hutchison in 2009 is believed to have a major impact on the industry. Economies of scale are expected to increase which is an economic barrier to entry in a new market.

Reason for research

The purpose of the research is to carry out an extensive research on the Australian mobile telecommunication providers. This will give a better understanding of the market, environment, and industry, how the operators compete and the various products available in the market. The information will form the basis for a strategic plan that new market entrants can use. It will offer insights for the realization of the business objective of the Loud and Clear Mobile Telecommunication.

Overall goals

In undertaking this research study, the following have been identified as the major goals.

To determine the major mobile telecommunication operators or service providers in Australia.
To be able to offer recommendations on Loud and Clear Telecommunication a new entrant in the market.
To analyse the Australian mobile telecommunication industry in the following dimensions: pricing, network coverage and reliability, pricing policies, and the pricing models used by the services providers.
To provide Loud and Clear Telecommunication with adequate information on the Australian telecommunication industry that could be used for strategic planning.
To examine the relationship between the different service providers in the Australian Mobile Telecommunication industry.
To understand the challenges found in the mobile telecommunication industry.


The research is both based on qualitative and quantitative research designs. Data and information was collected from the major key players in the mobile telecommunication industry. Quantitative and qualitative methods have been applied to collect data from both primary and secondary data sources. This implies that the data collected is from primary and secondary sources. The collected information has been found be dependable, accurate, up-to-date, and reliable.

The gathered information and data aligns with the goals of the organization as well as its business and research objectives. The information and data has been presented in the form of table, charts, and graphs. The data and information presented was used for interpretation and the analysis of the research findings.

In one way, the four companies were used as case studies for the study. The findings were used to draw conclusions which were used as the basis for providing the required recommendations. Comparison analysis has been employed where aspects like pricing, coverage, trends, reliability, and costs have been determined.

Lastly, the results findings were applied for interpretation purposes. Discussion of the findings relies heavily on the presented data. This has been used as the basis for the research. Based the findings recommendations have been made that can be applied by the Loud and Clear Mobile Telecommunication. The recommendations are viable, feasible and applicable in designing a strategic plan.

Findings and conclusions

This section of the research study provides the research findings which have been generated from both primary and secondary sources. The findings have been used to make the research conclusions.

Table 1: Ranking of the 4 service providers based on customer satisfaction

Service provider Satisfaction Ranking %
Virgin Mobile83%
Source: Corner:2010