ANZ business fixed market to remain under pressure

Australian business fixed revenues to grow at 1.2% CAGR through FY28, while New Zealand faces a -0.2% CAGR decline.

David Kennedy · Venture Insights20 September 2024Period: FY243 min read

+1.2%↑

Australian total business fixed revenue CAGR (FY23-28)

-15.3%↓

New Zealand B2B voice revenue CAGR (FY23-28)

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Abstract

This report forecasts the 2024-2028 outlook for the Australian and New Zealand business fixed telecommunications markets. It highlights a market under significant pressure from the commoditisation of connectivity and the rapid decline of legacy services like PSTN and IP-VPN. While certain segments like IP voice and managed services show growth, total market revenues remain sluggish, with Australia expected to reach A$7.124bn by FY28 at a modest 1.2% CAGR.

Key Takeaways

Australian business fixed revenues are forecast to grow at a modest 1.2% CAGR through FY28, reaching A$7.124bn.
New Zealand's market will contract at a -0.2% CAGR, with total revenue falling to NZ$953 million by FY28.
Voice revenues are collapsing, particularly in New Zealand where a -15.3% CAGR decline is expected due to the FY25 copper network shutdown.

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Frequently Asked Questions

Growth is marginal, with total revenues projected to reach A$7.124 billion by FY28 at a 1.2% CAGR. While connectivity is commoditising, managed and professional services represent the primary expansion opportunity with a 2.8% CAGR.

The outlook is critical as the FY25 copper network shutdown accelerates the collapse of legacy systems. New Zealand B2B voice revenues are projected to contract at a sharp -15.3% CAGR through 2028.

No, the data and internet segment is largely stagnant with a projected CAGR of just 0.2% in Australia. Gains in Ethernet and standard internet are being neutralized by the rapid abandonment of high-margin legacy IP-VPN services.

Incumbents are facing severe margin compression, evidenced by Spark's 1.6% decline in total IT revenue during FY24. Major players like Telstra and Optus are being forced into aggressive cost-cutting and asset write-downs to maintain profitability.

ANZ business fixed market to remain under pressure

Abstract

Key Takeaways

Frequently Asked Questions

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