CHARTS: Telstra's mobile business is under fire

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Telstra reported on Thursday that mobile revenue had dropped by more than 3% for the 2017 financial year.

With a series of outages over the past 12 months possibly affecting customer perceptions, combined with a cut-throat market featuring numerous mobile virtual network operator (MVNO) rivals such as Amaysim, Kogan, Aldi and Woolworths nipping at Telstra’s heels, the result wasn’t entirely a surprise.

Telstra’s report admitted that changes in the telecommunications industry have lowered the barriers to entry for “emerging competitors” with “lower cost bases, and agile, innovative business models” — and it could be having an impact on its own earnings.

Telstra chief Andrew Penn even announced yesterday that the telco would launch its own budget label — Belong Mobile — to fight the price-conscious MVNOs.

The Australian Bureau of Statistics reported last month the industry was a drag on inflation, with a 3.8% fall in prices in the year to June 2017.

In addition to MVNOs, TPG bought spectrum in April to kick off plans to spend $1.9 billion to build Australia’s fourth mobile network. Although that network will gradually rollout over three years, the additional competition has left the incumbents unable to increase margins.

With such pressures, Business Insider dug up some figures to get a better insight into Telstra’s mobile woes.

Here’s what we found:

Telstra is losing market share

Just in the past year, figures compiled by research group Kantar shows Telstra went from 41.8% market share to 39.5%.

The telco has especially taken a hammering in the prepaid market — which has seen strong competition from MVNOs — dipping from 42% in June last year to 36.6% a year later.

(Source: Kantar)

SIM-only plans are killing Telstra

MVNOs are masters at selling SIM-only plans, which reduce the monthly cost for consumers by not including subsidies for a handset.

Telstra’s market share in SIM-only postpaid is just 31.9%, more than 90 basis points behind its overall market share.

(Source: Kantar)

Customer growth has stalled

The number of customer services has headed up in recent years, but the growth is nowhere near the heady days of 2008 to 2013 when it increased more than 60%. Since then, the growth has been just 16%.

(Source: Business Insider)

Revenue per customer is falling

While revenue has dipped just the past two years, the amount of money coming in per customer service has been on a downward trend for the past 10 years.

(Source: Business Insider)

Here is the full table the charts were drawn from:

(Source: Business Insider, Telstra annual reports)

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