BT stares down Telstra's services challenge

As BT looks to grow its global services arm in Australia, Asia, and Africa, the company will face stiff competition in the Asia-Pacific region from Australian incumbent Telstra.

Although BT is traditionally thought of as the Britain-based telecommunications incumbent, the company also has a large global managed services arm established in other areas of the world, including in Australia, where the company has around 300 staff members across Sydney, Melbourne, and Perth. Locally, the company has gained more than 250 customers over the last 27 years, including the Australian Securities Exchange and Serco Australia.

BT announced overnight that it would invest in over 400 new staff members across Asia and Africa, with at least 40 new people employed in Australia over the next 12 to 18 months.

The company has a particularly strong focus on the financial industry, due to the company's points of presence across the globe, but BT also works in a number of other sectors, including health.

BT's largest managed services rival in Australia is the incumbent telecommunications provider Telstra, which is pushing heavily into its Network Applications and Services division as part of a growth strategy into Asia. The company already has plans to grow its NAS division by 300 to 400 staff.

BT is rising to the challenge, however. While back in the UK, the company's focus may be similar to that of Telstra's in Australia — selling managed services as part of the network product — BT's Australasia managing director Simon Gatward said he sees it as an advantage in competing in Australia that BT doesn't have its own network.

"The advantage discussion is I'm not trying to flog you carriage. It's not a high-value, high-services, high-proposition, but 'by the way can you buy some carriage' [offer]," he said.

"I'm not bound by that."

But Gatward said that Telstra's existing large customer base in Australia would always mean it would have some advantage over even a global player like BT in this market.

"The other side of the equation is that I don't have as many customers in Australia that I've got the right to knock on the door because I'm already sending them a bill," he said.

On the other hand, Gatward said that BT's global presence offered it a big advantage over Telstra, which is still in its infancy of its own global expansion.

"An attractive customer to us is always going to be an organisation that is Australian based and looking to grow internationally," he said.

"I think in that space, we have very few, if any, competitors."