Australian innovation needs confidence injection: Thodey

Telstra CEO David Thodey has argued that Australia has what it takes to start the next global tech giant — it just needs the confidence to follow through.

Telstra CEO David Thodey
(Credit: Josh Taylor/ZDNet )

Speaking at an American Chamber of Commerce event in Sydney yesterday, the Telstra CEO said that Australia cannot always rely on the mining boom, and will need to look to the tech sector to start challenging the rest of the world.

"There's no reason why the next Facebook, Twitter, any of the so-called new online companies couldn't come from Australia," he said.

"I've been in this industry for nearly 33 years, [and] I've talked a lot about the importance of innovation and technology within Australia, but the truth is it hasn't nearly gone a tremendous way. There hasn't been real sustainable investment in local technology companies within Australia," he said.

Australians he encounters in Silicon Valley are "very innovative" and quick to assimilate on the latest trend, but have yet to recapitalise on that, he said.

"Australia is known as one of the best early adopters of technology, so why is it we don't do really well in the technology stakes?" he asked.

"We're a lucky country, we've got great mining resources, we're a great sporting nation, but can we really become the clever country?"

Thodey said that we must become so, because "many of the other things that our wealth are being created on are not necessarily sustainable over the long term".

"We have an incredible opportunity to change that focus to become a clever country, and I really think we need to do it."

He said that the difference between how Australia views innovation and how the US does is just about confidence.

"I think it is self-belief. I don't want governments to do it. We're not looking for a hand-out. I think it's about creating an environment where [innovation] is seen as good, we're encouraging it, creating a vision for it," he said. "And success helps; if you can get a few good wins under your belt, then the industry will grow in its own right."

Where the mining sector has grown the wealth of a few people, he said that growing the technology industry will benefit many across a wide array of industries.

He said that he also sees that Telstra itself needs to adapt and do things differently, too, in a world where the demand on its mobile network grows 100 per cent every year.

"Any sort of industry would die for those sort of demand statistics. However, it is difficult to find capital to get the same returns you had before. So we've got to change the model in which we do our business," he said.

Part of this is rolling out new technology, such as long-term evolution (LTE) mobile networks, but also involves looking at expanding into other industries and other parts of the world.

"We want to be based in Australia, we want to be a great Australian technology company, but our sight and our vision needs to be somewhere else. That's what gets me excited."

But he said that Telstra is aware of its limits.

"Just because you're good at doing something in Australia doesn't mean you're good at doing something in another country. Especially as a telco," he said. "I think you've got to be very clear about where your core capabilities are."

For example, Telstra dominates the mobile market, but while Thodey said that he recently met with Square, a mobile-payments company based in the US, Telstra has no interest in being a mobile-payments company at this stage."We did our first mobile banking, which was point-of-sale near-field communications [NFC] ... with NAB down in the Docklands area," he said. "As a telco operator, we're an enabler of transactions, but we're not a bank and we're not a financial institution."