Pressure on Facebook over political advertising\ NBN continues push into business broadband\ Auspost launches MVNO\ Optus 5G and SWM team for Tokyo Olympics



 




In this week’s edition, we look at the pressure on Facebook over political advertising, NBN continues pushing into business broadband, Auspost launching MVNO, and Optus’ partnership with SWM for Tokyo Olympics.

CHART OF THE WEEK

Facebook share of digital display advertising in Australia (%)



Source: ACCC DIGITAL PLATFORMS INQUIRY FINAL REPORT

Pressure on Facebook over political advertising

US political ad spending, election years 2010 2020 ($bn)



Source: GROUPM

With elections in the UK in December, and in the US in 2020, online political advertising is receiving intense scrutiny. Google has announced limits on targeting, while Twitter has banned politicians from buying ads. Facebook is the big player in online political ads, and it continues to allow targeted political ads, and to carve them out as exempt from fact-checking. Owing to political and policy pressures, Facebook may intensify restrictions on political advertising. However, its interest in political ads is much greater than Google’s or Twitter’s, so it may not go as far. We have witnessed similar concerns in Australia by the public that money can buy policy. Facebook had to place a temporary ban on foreign-funded political advertising ahead of Australian federal election in May, and a study by The Australia Institute showed that a majority of Australians wanted tighter regulations for political advertisement on social media with 60% supporting an outright ban. To read more on Facebook’s current positioning and how the its political ad future might look like, click on to read our report.

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NBN continues push into business broadband

The NBN has announced that it plans to offer generous discounts for its business broadband bundles along with additional discounts of 10-15% for multi-year contract sign ups. The discounts follow NBN’s move to slash prices of its business broadband product by half in August. The NBN’s entry in business broadband and the rise of SD-WAN is changing the market dynamics in the enterprise market and while these changes are expected to drive price declines, it should also lead to an increase in the number of fibre SIOs. Venture Insights also expects new MVNOs will enter and target the business market – as NBN’s business broadband products will enable more challengers to enter the business market and these new players will also become MVNOs over time in order to bundle 4G and 5G services. Venture Insights expects the enterprise market to get increasingly competitive especially for the likes of Telstra which has so far dominated this space. However, while there will be pressure on pricing for Telstra enterprise, the NBN’s entry will lead to an increase in the size of the overall market for fibre subscribers in business broadband. Click through to read our report on how Telstra is managing the changing dynamics in the enterprise space.

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Auspost launches MVNO

MVNO Market share in Major Metros



Source: VENTURE INSIGHTS CONSUMER MOBILE SURVEY, N= 1,008, AUGUST 2018

Australia post is offering FlexiSIM in partnership with TravelSIM and Optus marking its entry to the MVNO segment of the telco market. Its entry level plan is priced at A$19 per month, and the premium plan offers 25 GB of data at A$35. Both come with unlimited national calls and texts. The FlexiSIM is aimed at providing flexibility to the consumers in terms of data, and they will be able to upgrade their plan at any stage within their billing cycle, share data with up to five other customers or gift up to 5 GB of data to any FlexiSIM customer. The Australian MVNO market remains a highly competitive space with MVNO subscribers growing at a 10% CAGR from 2011 to 2018 vs just 1% for MNO subscribers in the same period. Venture Insights’ telco survey data shows that MVNOs have over 20% market share in metro areas and we believe this is set to rise given some 40% of metro respondents who were considering shifting providers indicated they would select a MVNO as their next provider. For a more detailed look at the current state of the MVNO market, click through to read our report.

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Optus 5G and SWM team for Tokyo Olympics

Sports streaming usage by age



Source: VENTURE INSIGHTS MOBILE CONSUMER SURVEY MARCH 2019, N=1,026

Optus will team up with Seven Network to provide 4K Ultra HD coverage of the 2020 Tokyo Olympic Games for the first time over a 5G network for its 5G home broadband customers using the Fetch Mighty set-top-box. This exclusive partnership will benefit 300 current 5G sites in NSW, Queensland and Victoria, and the telco plans to build 1200 5G sites by March 2020. The Olympics will be held on 24th July, giving Optus the opportunity to activate more 5G sites. This move is in-line with Venture Insights’ view that sports remains an integral component of Optus’ overall strategy in Australia and sports streaming over 5G will emerge as a key use case as the network rolls out. For a more detailed look at how sports streaming could evolve with 5G and the role that telcos could play,  click through to read our report.

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