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Telstra's mobile growth slows

After years of adding millions of customers onto its mobile network, Telstra CEO David Thodey has admitted that the company is entering a phase of slowed growth.
Written by Josh Taylor, Contributor

Telstra CEO David Thodey has said that Telstra's meteoric growth in mobile is beginning to slow, despite a strong launch for the iPhone 6.

In August, Telstra reported that for the last financial year, it added close to 1 million new mobile subscribers, bringing its total customer base up to 16 million — higher than those of Optus and Vodafone combined.

This growth, however, is beginning to slow, Thodey told investors in Sydney on Thursday. However, he insisted that the "positive business momentum" for Telstra is continuing.

"The iPhone 6 launch was pleasing for us, and post-paid handheld [average revenue per user is] continuing to improve," Thodey said.

"Overall, mobile customer market growth continues to moderate. We are also seeing some deactivations in our prepaid subscriber base. However, strong mobile revenues have continued," he said.

Thodey indicated that the deactivations in prepaid have less to do with competition, and more to do with Telstra deactivating inactive SIMs from its prepaid broadband market.

Although Telstra would not break out its customer numbers for the first quarter, Thodey said that he would like to see the mobile market continue to grow as a whole.

"What I'd like to see is the actual industry grow. That's probably more my focus. I think we'll continue to be competitive in the market," he said.

"We'll never let ourselves get to the situation where the premium isn't valued by the customers."

Although Telstra has seen a 50 percent growth in data use, Thodey said the focus for Telstra is not on how to increase revenues in line with the growth in data use.

"We have seen really strong growth in our mobile in terms of profitable growth," he said, adding that Telstra is deriving value by putting technology in its mobile network to drive down the cost of carrying data per gigabyte on the network.

"We will continue to look at how we do that. [It's about] creating value about how you use that data, [and] not creating a bad experience for the customer, but also paying for what they're using," he said.

"It's not 50 percent revenue growth, because that would be unrealisitic."

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