Telstra cut around 1,000 full-time staff positions in
the six months from June 30 last year and has commenced the
network buildouts it announced in November.
Telstra chief executive Sol Trujillo outlined the cuts to
analysts at a briefing dealing with the telco's mid-year
financial results in Sydney this morning, saying the number was made up of the equivalent of 1,000 full-time staff and included some contractors.
The move is part of Telstra's ongoing plans to reduce costs,
with 10,000 to 12,000 staff expected to go over the next five
The telco is also making progress on a number of network
construction projects outlined at its strategy briefing in
Trujillo said his company and vendor Ericsson had conducted
1,500 site audits and 200 site designs for the nation-wide
third-generation mobile network Ericsson was contracted in
December to build.
Telstra has issued the first AU$150 million purchase order for
equipment for the 3G network, with installation already having
started in some areas.
In addition, the telco signalled it will receive the first 20
DSL Access Multiplexers (DSLAMs)
from vendor Tellabs by the end of February.
DLAMs are network equipment that sit in Telstra's telephone
exchanges and deliver DSL services to customers. Telstra has
previously said it is upgrading its network to the ADSL2+
standard which allows speeds of up to 24Mbps.
A number of the telco's competitors already offer ADSL2+
services, but Telstra's ADSL speeds (and consequently that of its
wholesale customers) are currently limited to 1.5Mbps.
Telstra has also received the first Alcatel 'softswitch' -- a
software telephony switching device for connecting calls -- and
is currently testing the hardware.
Alcatel won the right to provide a large chunk of the hardware
for the telco's next-generation network buildout. Telstra also
said it had signed the contract with Cisco for that network's
Internet Protocol (IP) core.
In terms of Telstra's transformation of its operational and
business support IT systems, Trujillo said detailed scoping of
the project was complete, and vendors involved with the project
had been engaged.
Telstra has signed a licensing agreement with Customer
Relationship Management (CRM) software vendor Siebel (which has
recently been acquired by Oracle). Back in November, Trujillo
said Accenture would also be involved in a large-scale CRM project.
In terms of complexity reduction -- a key strategic outcome
for Telstra -- Trujillo said a pricing simplification team had
been established, and some "IP product simplification" was under
Scoping for the AU$200 million training program to provide
field staff with the skills to build, deploy and run
next-generation networks has commenced.
During the analyst briefing Trujillo was peppered with
questions from the investment community, with many concerned
about the telco's December decision to put its fibre-to-the-node
(FTTN) customer access network on hold.
In December, the telco said the FTTN component of its next
generation network would remain on hold after the government
opted not to intervene to allow the carrier to restrict
third-party access to its planned new infrastructure.
Analysts were also concerned about Telstra's risings costs and
the threat of declining revenue in Telstra's legacy copper
telephony network -- the Public Switched Telephony Network or
"A major concern for us remains the decline in PSTN," admitted
In addition, several analysts questioned the chief executive
about Telstra's ongoing debate with the federal government and
the competition regulator about the cost of rivals like Optus
accessing Telstra's copper network -- known as Unbundled Local
Trujillo and Stanhope largely pointed out the ACCC had not yet
finalised its position on the issue.
During the briefing the CEO also announced Telstra had snapped
up high-profile Qantas chief information officer Fiona Balfour to
lead the telco's centralised IT organisation and core IT
programs, as well as to oversee the company's operations support
system and business support system projects over the next 3-5