Telstra's Transformation and Impact

This assignment delves into the history and evolution of Telstra, a prominent Australian telecommunications company. It examines key events such as its privatization, strategic initiatives like MOG and social media engagement, and its enduring position as Australia's most valuable brand. The assignment also analyzes trends in the telecom industry and assesses Telstra's role within this dynamic landscape.

Telstra 1
TELSTRA
Name
Course
Tutor
University
City/State
Date

Telstra 2
Telstra also was known as the Telstra Corporation Limited has been ranked as the leading
and one of the largest telecommunications in Australia. Telstra develops and operates
telecommunication networks, internet access, television subscriptions along with other products.
Telstra has had a history that transcends from the department of Postmaster-General (O'leary,
2003). As of today, Telstra is now a wholly privatized enterprise and is striving to become
customer-focused entity through development programs under its chief operating executive
(Telstra, 2018). However, the federal government through the National Broadband Network is
making and effecting changes to the industry and may see the company sell its copper and HFC
networks to the state’s NBN holding company. The present CEO Andy Penn has been striving to
improve the company’s market value following its declined under his management.
The Australian telecommunication services were initially under the department of
Postmaster-General that was established in 1901 following the Australian Federation. Before
1901, telecommunications were controlled by each colony. However, as of 1975, different
commissions were established by the statute thus replacing the PMG. The overseeing of postal
services was then transferred to the Australian Postal Commission. The Australian
Telecommunications commission that traded as Telecom Australia was responsible for
supervising the telecommunication services.
It is in 1992 that a separate body under the state known as the Overseas
Telecommunications Commission merged with the ATC and became the Australian and
Overseas Telecommunication Corporation and continued to pose as Telcom and OTC. It is in
1993 that AOTC was rebranded to Telstra Corporation Limited in 1993. Telstra is a name that
was coined from Telecom Australia. The corporation branded itself under the name Telstra both

Telstra 3
internationally and domestically till the same branding of Telstra got introduced in the entire
organization.
Telstra has had to deal with the fierce competition since the 1990s from other institutions such as
Optus one of the second largest communication enterprise in Australia and other small providers.
At one time Telstra had controlling ownership of a fixed-line telephone network though
following countrywide upgrades to the national broadband Network, the government of Australia
has the legal control and ownership of such lines since 2007.
However, Telstra had a crucial role in facilitating improvements by providing resources
to the state, and this made Telstra claim priority of the new network. Telstra also has a pay TV
and data cable enterprise known as the Foxtel. Other business enterprises that offer fixed-line
services have to first to transact with Telstra with the exclusion of Optus, Transact and any other
company that has invested and put their infrastructure in place.
Privatization
The privatization of Telstra followed three phases identified as T1 for stage one, T2 for
phase 2 and T3 for stage 3 in threes subsequent years that is 1997,1999 and 2006. As per the first
stage, the T1, the state only sold one-third of Telstra shares for A$14 billion and went a step
further of listing the company to the Australian Stock Exchange. The second phase, the T2,
entailed the government selling 16% of the shares to the general public and the state only
remained with 51% ownership (Budde, 2006).
However, as of 2006, the government led the third phase and the state announced that it
was the largest compared to the other releases thus reducing the state’s management of Telstra to
only 17%. The remaining 17% of the company was handed over to Australia’s Future Fund and
acts as a pension for the Public Servants. In 2009, the Future fund went a step further and sold

Telstra 4
shares worth $2.4 billion a move that reduced the state’s stake in Telstra to about 10.9%. In
2011, the Future Fund went ahead and sold the remaining shares in Telstra above what is termed
as the market weight leading to the competition of Telstra’s privatization. Telstra as of today has
one million shareholders and the most preferred in the ASX-listed company.
Telstra digital
Telstra announced the establishment of Telstra Digital in 2011, and this was under the
management of Schenkel who has been recruited from the National Australia Bank. The purpose
of Telstra digital was to employ the use of digital mediums in improving customer experience
(Fitzsimmons & Smith, 2013). Telstra digital went a step further and relaunched a web
homepage. It is in July of the same year that Telstra Digital launched crowd support which was
an online forum that crowdsourced customer service (Lee, 2011). It is in the mid of last year that
Telstra’s crowd support had more than 450,000 posts (Battersby, 2011).
Retail store network
Telstra manages a number of stores that it owns identified as the Telstra stores. Some of
these stores are held directly and managed by Telstra Corporation, and others are under
licensees. In 2016, Telstra had more than 360 retail stores located all over Australia. This entails
numerous new ‘Discovery’ stores where it is stated that Telstra has invested regarding million in
redesigning the main stores to suit the tastes and preferences of the locals. The designs entail the
use of new displays, digital tickets and accessory shops.
Products and services
Mobile telephony and fixed line services
Telstra has been recognized as the incumbent and the largest provider of fixed-line
products. Such services entail home and enterprise phone services and other associated PSTN

Telstra 5
services. In most cases, Telstra is tasked with outsourcing a substantial part of network
installation services and maintenance to private contractors and joint enterprises, for instance, the
ABB communications and affiliates of Siemens such as STCJV.
Telstra mobile is ranked as the leading mobile telephone provider with regards to both the
number of subscribers and network coverage (Schenkel, 2011). Telstra runs the largest GSM in
Australia and 3G networks and also mobile telephony. Also, the company prides itself as it holds
more than a 50% stake in the 2100 MHz network shared with the Hutchison. Based on the record
of 2007, Telstra was said to have more than 9 million mobile subscribers. The mobile services
provided by Telstra are available for both the post and prepaid options currently known as the
Telstra Pre-paid.
The GSM network by Telstra was the first of its kind with regards to the digital mobile
system in Australia. The GSM network over the last ten years has seen many people subscribe to
its network while also undergoing multiple upgrades. Telstra which operated under the alias
Telecom Australia in 1981, was reported as the first enterprise to offer mobile telephony service
in Australia.
Internet
The provision of services such as data, mobile, and other facilities are under the Telstra
Wholesale. It is also the mandate of Telstra Wholesale to provide operational support for its
broad customer base. The company also offers facilities that are needed by international
customers such as IP transport among other services (Rick, 2015). The position of Telstra as
Australia’s incumbent in the field of telecommunications has led to Telstra Wholesale being the
dominant wholesaler with regards to ADSL services to other service providers of the internet.
Subscription television

Telstra 6
The Hybrid Fiber-Coax by Telstra is ranked as the most developed delivery channels that
are used by the Australian Subscription Foxtel, a service provider with regards to television
content. Telstra co-owns Foxtel with the News Corporation on a 50-50 deal. Telstra also offers
generous deals and discounts to customers who use a full-service fixed line, with internet or
mobile services with Telstra (Mason, 2017). Such offers range from free installation to enjoying
a full month of free subscription to the Foxtel products by new users.
Entertainment services
Telstra initiated a Facebook application that enables users to record audio messages on
their Facebook pages known as “Blurtl” in 2011. In 2012, MOG (Hamilton, 2012) an online
music subscription service and also a blog network revealed its intentions to enter into a
partnership deal with Telstra to provide their services in Australia and Australia would be the
first country to use such services outside the United States’ borders.
India macroenvironment analysis
The telecom services continue to receive global recognition as being the most
fundamental instruments for advancing the socio-economic development of any particular
nation. Telecommunication is needed for supporting some of the services considered to be vital
and critical in facilitating rapid growth and civilization of different sectors in the economy
(Kumar, 2014). The Indian telecommunication sector can be said to have undergone numerous
revolutions with the help of policy reforms that were effective starting with the announcement of
National Telecom policy in 1994 (Kumar, 2014). It is through the policy initiatives that have the
Indian telecommunication sector undergo a complete transformation in the past few decades. The
industry has also attained significant growth over the past few years and is projected to assume
substantial leaps as per the future.

Telstra 7
The telecommunications network in India has over 930 million subscribers and is ranked
as the third largest in the world (Kumar, 2014). Such a rapid exponential growth has been
possible due to the availability of proactive yet positive decisions made by the state and also
from the contribution of sectors in both the public and private departments. Such significant
milestones in the telecom industry have been a reality due to the existence of liberal government
policies that ensure that there is ready access to the market for telecom infrastructure and a
regulatory framework that is fair responsible for providing telecom services to the consumer as
reasonable yet affordable prices in India. Currently, the government has opened telecom services
for private participation.
Opportunities for telecommunication services in India
Rural Telephony
Though the urban economies are reaching their saturation points faster than expected
with regards to telecom services mainly the voice telephony services, the broad rural market
presents a vast potential necessary to drive and propel future growth of telecom enterprises. It is
estimated that the teledensity in rural regions is about 15% and portrays the extent of opportunity
that is left untapped for future telecom companies (Kumar, 2014). Also, the government
initiatives aimed at increasing the connectivity of telecom in rural areas will help the providers of
telecom services in extending their services to rural areas that are unconnected.
The use of initiatives such as the USO Fund and the sharing of infrastructure will be
significant with regards to increasing the coverage of telecom services particularly in areas that
are considered far-flung. It is such penetration in remote regions that not only will promote the
expansion of telecom service providers but also help in boosting the demand for equipment and
infrastructure needed in such an industry.

Telstra 8
There is a huge potential growth element in 4G services
The deployment of 4G in India as of today would be referred as being in the nascent
phase. The 4G services have only been launched recently in India (Kumar, 2014). The 4G
services will be crucial in stimulating the future expansion of the telecommunication industry.
Some of the services provided through the 4G platform not only enhance business expansion
through data provision that has high speed and content-rich products but also play a critical role
of linking the urban-rural split by ensuring the usage of mobile services at a faster rate in rural
areas.
The introduction of 4G will be significant to the BPO in the Indian industry as it will
increase their competitiveness. The penetration of mobile cellular in India is higher compared to
that of a fixed telephone line which means that the use of mobile brand through the 4G will not
only stimulate but also trigger the penetration of broadband.
Some of the advantages associated with the economies of scale are inherent, and the easy
marketing of the 4G services with regards to implementing such services will be advantageous to
the service providers. It is the high-end customers who will get lured to enter such markets due to
the availability of 4G services leading to the first mover advantage to the early entrants in the 4G
market. Introduction of 4G services will lead to other services being provided such as the video
calling services, internet access that is high speed and data provision services and this will revive
the ailing sector.
The plan by the government of India to auction the 3G services platform through
auctioneering may assist in creating a healthy environment that provides quality services and
products to the consumers (Kumar, 2014). The auctioning of 3G and the broadband network
conducted through e-auctioning by a specialized agency facilitates that there is openness in the

Telstra 9
whole process. Bids are invited from both the domestic and international players. Allowing new
players in the industry is essential in the process of auctioneering as it will enable technological
innovation to be brought on board while intensifying healthy competition leading to the
provision of more choices at competitive rates to the consumers.
References
Battersby, L., 2011. Telstra wants to get more customers online. [Online]
Available at: https://www.smh.com.au/business/telstra-wants-to-get-more-customers-online-
20110220-1b10v.html
[Accessed 21 August 2018].
Budde, P., 2006. Australia - Privatisation of Telstra. [Online]
Available at: https://www.budde.com.au/Research/Australia-Privatisation-of-Telstra
[Accessed 21 August 2018].
Fitzsimmons, C. & Smith, P., 2013. Telstra, Target leading on social media customer service.
[Online]
Available at: https://www.afr.com/technology/telstra-target-leading-on-social-media-customer-
service-20131021-jyjhp
[Accessed 21 August 2018].
Hamilton, G., 2012. MOG powered by Telstra – A massive deal for music lovers. [Online]
Available at: https://exchange.telstra.com.au/mog-powered-by-telstra-a-massive-deal-for-music-

Telstra 10
lovers/
[Accessed 21 August 2018].
Kumar, P., 2014. Telecom Services: Emerging Trends, Opportunities and Risk. International
Journal of Business and Administration Research Review, 1(5), pp. 34-41.
Lee, T., 2011. Telstra reveals social networking strategy. [Online]
Available at: https://www.theaustralian.com.au/australian-it/telstra-reveals-social-networking-
strategy/story-e6frgakx-1226116285981
[Accessed 21 August 2018].
Mason, M., 2017. Telstra still Australia's most valuable brand. [Online]
Available at: https://www.afr.com/business/media-and-marketing/telstra-still-australias-most-
valuable-brand-20170127-gtzssc
[Accessed 21 August 2018].
O'leary, G., 2003. Telstra sale: background and chronology. [Online]
Available at: http://parlinfo.aph.gov.au/parlInfo/search/display/display.w3p;query=Id%3A
%22library%2Fprspub%2F5NFA6%22
[Accessed 21 August 2018].
Rick, M., 2015. Telstra launches world’s first 600Mbps-capable Category 11 device. [Online]
Available at: https://exchange.telstra.com.au/telstra-launches-worlds-first-600mbps-capable-
category-11-device/
[Accessed 21 August 2018].
Schenkel, G., 2011. Say hello to the new mobile face of Telstra.com. [Online]
Available at: https://exchange.telstra.com.au/say-hello-to-the-new-mobile-face-of-telstra-com/

Telstra 11
[Accessed 21 August 2018].
Telstra, 2018. About us. [Online]
Available at: https://www.telstra.com.au/aboutus
[Accessed 21 August 2018].