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AAPT no longer the Telecom NZ 'problem child'

Australian telecommunications provider AAPT has shed its image as being the "problem child" of parent company Telecom New Zealand, according to CEO David Yuile.
Written by Josh Taylor, Contributor

AAPT's decision to shed its residential broadband business and instead focus on the business market and infrastructure business has paid off, according to CEO David Yuile, while the new CEO of parent company Telecom New Zealand no longer sees AAPT as the "problem child" of the group.

Telecom New Zealand's new CEO Simon Moutter took the reins of the company last month, returning after a four-year stint as the CEO of Auckland Airport. According to Yuile, Moutter had already caught a plane across the Tasman to visit AAPT's offices, and had given the operation the thumbs up.

"We had the new CEO over here last week, and he's very happy where we're going. We got a very strong endorsement of the business and what we're trying to do, in particular, around the growth horizons," he told journalists.

"When Simon left AAPT, it was four and a half years ago and it was not in a good place. He actually sent me a note today saying he just can't believe the difference in terms of energy, capability and enthusiasm for the health of the business."

Moutter's opinion was much higher today, Yuile said.

"I get the funny feeling we're not talked of as the problem children anymore, whereas four and a half years ago, we were the big problem child within the group portfolio."

Since selling off the consumer division of AAPT to iiNet, almost two years ago, AAPT has turned its focus to its voice and data network, and its wholesale and business divisions.

The resultant sale of the consumer division has driven revenue for the company down, however, and including consolidation in the wholesale market, there was a decline in operating revenues for AAPT by AU$177 million to AU$516 million in the financial year ending 2012. Bouncing back from this, Yuile said that the company was looking at its core capabilities for growth.

"AAPT is one of the only telcos in the business focused on the wholesale market," Yuile said. "Fundamentally, we've got amazing core capabilities as a business. Our big thing is we're all about IP networks and adjacent stuff to that."

Yuile said that the company was focusing on winning customers that would bill up to AU$5 million, stating that he would leave the fight for bigger customers, like the Commonwealth Bank, to Telstra and Optus.

AAPT was also looking at forming alliances with systems integrators, like Fujitsu, to offer services to businesses. Yuile said that while Optus and Telstra were increasingly moving into the system integrator role in offering complete managed services to businesses, AAPT wanted to address the niche in the market, for the network operator to work with the system integrator rather than compete with it.

"A lot of system integrators are feeling challenged by the other operators [by offering IT services]," he said. "We're not."

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