The dust has settled on 2023, and looking back, a hell of a lot happened. Phone and NBN plans got even more expensive, password sharing got harder, the iPhone got USB-C, and there was a big outage that some would rather forget. But that's old news now - here's what I think could be next.
We’re not going to see any relief in terms of prices
It felt like everything got more expensive in 2023, and this trend is only going to continue in 2024. Just today Vodafone increased the price of all of its postpaid mobile plans. Telstra's Upfront mobile plans are likely to go up in July once again, and it's only a matter of time before Optus decides to do the same. While it didn't put up its prices last year, Optus' former CEO went on the record saying its plans are too cheap.
As long as Telstra keeps increasing its mobile prices, Optus and Vodafone will see this as permission to raise theirs. Optus positions itself as premium brand, but one that's still more affordable than Telstra. And while Vodafone's market position is more value-focused, it just needs to offer better data-per-dollar than Optus. After all, if you're buying a new phone on a plan, you've really only got three options.
We're also expecting to see NBN Co increase wholesale prices once again in July this year. This could lead to providers upping the price of home wireless internet plans. Telcos have typically positioned their 4G and 5G wireless internet offerings as a cheaper alternative to their NBN plans, but if NBN plans are getting more expensive, wireless internet can get more expensive but still be "cheaper".
2024 will be a growth year for smaller mobile providers
While smaller providers also had their fair share of price increases in 2023, they can still be a lot cheaper than the big names - especially in the mobile space. With the cost of living still on the rise, 2024 represents a growth opportunity for these telcos. Why pay over $60 a month for a plan that has more data than you need when you can get great plans for as little as $20?
Smaller mobile providers now also have fuller featured offerings, with perks like international roaming that were previously largely the domain of Telstra, Optus, and Vodafone. The main reason to stick with the Big Three is because you want to buy a new phone on a plan.
No momentum for mmWave
2023 saw Australians get exactly one new mmWave-ready phone, just like in 2022. And in 2021. Google is currently the only phone manufacturer that seemingly cares about mmWave support in its Australia-bound devices, and my bet is this won't change in 2024.
I'm sure Telstra, Optus, and Vodafone are still doing behind-the-scenes work on the faster form of 5G, but I'm not expecting much. It's been a long time between splashy announcements about record-breaking speeds.
Given regular 5G coverage still isn't ubiquitous, I can't see the mmWave rollout being a priority - especially when 5G hasn't quite been the game-changer telcos expected. It's hard to get anyone excited about faster 5G when the reaction to regular 5G has been quite tepid.
Realistically, the best use case for mmWave will end up being 5G home internet, with targeted deployments in specific areas, rather than widespread coverage.
At least one telco will have a ChatGPT integration
For better or worse, generative AI is the biggest trend in tech right now, which makes it pretty easy to imagine telcos wanting to get in on the hype. My bet is Optus, as generative AI would fit in with its Living Network pitch and how it sees itself as more of a tech company, rather than a telco. Large language models fit in neatly with features it already offers like translation and transcription. Of course, the upcoming appointment of a new CEO could end up changing this direction.
Streamers push subscribers to ad-supported plans
Everything that was old is new again, with streaming services like Netflix and Binge introducing ad-supported plans last year. More of these are on the horizon in 2024, and by the time the year is out, I'd be surprised if there's a single mainstream streaming service without an ad-based option.
More importantly, streamers are going to try and push customers to these plans. They'll continue to increase the delta between ad-supported tiers and more premium ad-free options, to the point where many will opt for the cheaper option. This sucks for me, as I always want the 4K tier. (Why have fast internet and a nice TV if you're not going to watch 4K content?)
The trend makes a lot of sense, however. It's a return to the old-school pay TV business model where you make money from customers as well as advertisers, and if a company can double dip, you know it's going to do that.
Alex Choros
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