127/05
14 November 2005

Telecommunications reforms continue to boost the economy 

The Australian economy received a $12.4 billion boost in 2004-05 demonstrating the clear and ongoing benefit of Government reforms to the telecommunications market, according to a report released today by the Australian Communications and Media Authority (ACMA).

Household consumption increased by $1.3 billion, small business benefited by more than $200 million, investment increased by $500 million and around 23,000 jobs were created in 2004-05 according to the report.

“These findings reflect the importance of the telecommunications sector to the Australian economy, and in particular the importance of getting the regulatory settings right, including measures to promote competition,” the Minister for Communications, Information Technology and the Arts, Senator Helen Coonan, said.

“Moreover, ACMA’s report shows the incredible impact the Government’s $157.8 million Higher Bandwidth Incentive Scheme (HiBIS) is having on the rate of broadband take-up.”

There was an impressive increase of 109 per cent in broadband Internet services over the year to March 2005, and a 230 per cent increase in data volumes. At the same time, prices per gigabyte fell by around 50 per cent for most broadband services.

“The report found that towns with populations between 800 and 2000 were the main beneficiaries of faster broadband speeds. In the past year, more than 800 regional and rural towns have been connected to terrestrial broadband services, such as ADSL and wireless, as a direct result of HiBIS,” Senator Coonan said.

“This means that more than 600,000 households and small businesses in regional and rural areas can now access an affordable ADSL or wireless broadband service as a direct result of HiBIS - 12 months ago they couldn’t. There are also now more than 10,000 HiBIS satellite services in operation.”

The ACMA report found that mobile phone use is on the rise and fixed line use is declining, a trend being witnessed around the world as people continue to switch from landlines to mobiles.

“The substantial benefits revealed by this report will be considered by the Government, together with other important data sources such as price and subscription levels, complaints to the Telecommunications Industry Ombudsman and surveys of consumer satisfaction, to assess the effectiveness of the regulatory framework going forward,” Senator Coonan said.

ACMA’s report titled Consumer Benefits Resulting from Australia’s Telecommunications Sector is available at www.acma.gov.au.