The report called the Australian Mobile Market 2005 - 2010, reveals that as the widely used 2G (second generation) and 2.5G protocols decline, success for mobile carriers will depend on getting users to migrate to emerging 3G (third generation) technologies by intelligent pricing and user education.

Commonly used 2G and 2.5G protocols offer high quality voice with limited data transmission, while the largely unnoticed 3G technology supports bandwidth-hungry applications such as videoconferencing and full Internet access.

Warren Chaisatien, managing director of Gibson Quai - AAS Pty Ltd.'s Telsyte, which surveyed major carriers and smaller operators, said even though it will be 2010 before 3G/3.5G users outnumber the 2G/2.5G segment, carriers need to change people's expectations of mobiles.

"The Apple [Computer Inc.] iPod is a classic example of how a technology has changed the way we consume music within a relatively short time and carriers can learn from this example. With new applications like mobile TV, m-commerce and smart home now available, carriers need to change the way consumers expect to use their mobile phones," he said.

The survey says that by the end of 2005, 80 percent of mobile data revenue came from text messaging, a 2G and 2.5G based technology, while its struggling 3G counterpart represented five percent.