Australia, New Zealand D2D connections to top 1.5m

Low-earth orbit direct-to-device services in Australia and New Zealand will reach more than 1.5 million connections in 2027, according to Gartner. The research group expects the market to surpass 670,000 connections in 2026, up from more than 250,000 in 2025.

Gartner also estimates end-user spending will rise from USD $5 million in 2025 to about USD $23 million in 2026 and USD $66 million in 2027.

Low-earth orbit direct-to-device, or D2D, services deliver mobile connectivity to standard smartphones through satellites rather than relying solely on terrestrial mobile towers. The model is drawing attention in Australia and New Zealand because large remote areas still lack reliable mobile coverage.

Geography is a central factor in the region's uptake, said Khurram Shahzad, Senior Director Analyst at Gartner. "Australia and New Zealand are among the early adopters of LEO D2D satellite communications due to the vast remoteness and persistent gaps in terrestrial mobile coverage in both countries," he said.

Shahzad said the market is moving from trials to broader rollout. "Adoption is accelerating rapidly as services move beyond early trials and into broader commercial availability, demonstrating how satellite connectivity can extend mobile coverage without the need for traditional infrastructure," he said.

Rural Demand

Consumer demand is concentrated in rural and remote use cases, where users want access to basic mobile services beyond the reach of conventional networks. Gartner said the service can support text and voice, with broadband data expected to follow.

That has made D2D relevant for people travelling off-grid and for those seeking a safety connection in isolated regions. In both countries, outdoor travel, recreation and distance from established networks are creating a market for satellite-based mobile access.

Enterprise demand is also increasing, particularly among businesses with field-based workers. Gartner identified mining, agriculture, forestry and transportation as sectors where continuous connectivity is important for operations and worker safety.

Shahzad said the current customer base still leans heavily towards consumers. "Current demand for LEO D2D services in Australia and New Zealand is primarily being driven by consumers requiring mobile connectivity in rural and remote areas, particularly for safety, recreation and off-grid travel," he said.

He added that business use is widening. "However, enterprise demand is steadily increasing for field operations in industries such as mining, agriculture, forestry and transportation, where continuous connectivity is critical for operations and worker safety," he said.

Carrier Response

Mobile operators are responding by adding satellite partnerships and integrating D2D access into existing mobile plans. Providers are commonly offering the service as a premium feature or add-on rather than as a standalone product, Gartner said.

This approach lets operators extend coverage without building towers in sparsely populated or difficult terrain. That matters in Australia and New Zealand, where the cost of terrestrial infrastructure can be hard to justify outside major population centres.

Gartner expects customer assumptions about network reach to change as these services spread. It predicts full geographic outdoor mobile coverage will become a baseline expectation within five years, eroding the historic advantage leading operators gained through infrastructure scale.

That could reshape competition among established carriers, particularly where coverage claims have long been central to marketing and customer retention. Operators that move early may also gain scope to charge more for premium plans that include satellite access.

Shahzad said carriers see both defensive and commercial reasons to adopt the service. "CSPs are highly motivated to deploy D2D to reduce churn, differentiate their offerings, and capture an estimated 10% to 30% attractive average revenue per user (ARPU) uplift without the capital expenditure of building terrestrial towers in challenging geographies," he said.

Examples are already emerging in both markets. Gartner said Telstra has moved early in Australia, initially offering text messaging and including D2D services in higher-tier plans at no extra charge, while One NZ is positioning the service as part of its claim of full geographic coverage across New Zealand and adding it to postpaid plans to encourage uptake.

The market remains small in revenue terms, but it is growing quickly in both users and spending. By 2027, Gartner expects connections in Australia and New Zealand to total 1.522 million, with end-user spending reaching USD $66 million.