Telstra chief executive officer Sol Trujillo today claimed his company was making progress on delivering the wide-ranging strategy he outlined in a landmark briefing last November. "We're one year into a fundamental transformation," he said in an address to the National Press Club in Canberra that was broadcast live on ABC televion.
Telstra chief executive officer Sol Trujillo today claimed his
company was making progress on delivering the wide-ranging
strategy he outlined in a landmark briefing last November.
"We're one year into a fundamental transformation," he said in
an address to the National Press Club in Canberra that was
broadcast live on ABC televion.
On November 15 last year, Trujillo outlined a number of
initiatives aimed at slashing costs, rationalising business and
operational platforms and building new network
"There's been progress everywhere in the transformation of
Telstra," the executive said today, noting he liked to talk about
his company being "under construction".
"The new Telstra does in fact put the customer first, using
modern, market research to determine customer segments, and
differentiate Telstra from its competitors."
Trujillo cited new subscription-based telephony plans launched
last week by Telstra as an example of the results of this
so-called "market-based management".
The Telstra supremo said "well over half" of his company's
new nation-wide third-generation (3G) mobile phone network had
been built, with the rest due to be finished by the end of this
"The deployment of our new Internet Protocol core equipment is
also advancing on schedule," he said.
Trujillo also claimed progress in the tricky area of customer
service, an area in which the popular perception is that Telstra has floundered.
"We have achieved big reductions in customer service waiting
time, for example, by 62 percent in fixed broadband [ADSL] and by 20 percent in
fixed-line phone services," he said.
"We've reduced fault detection time by up to 25 percent -- while
we're taking cost out of this business."
Trujillo said Telstra also now had more than 750,000 customers
using its online billing platform.
And the company is saving money by not using as much
"We have exited more than 25 buildings, cutting the size of
our property portfolio, saving more than AU$14 million annually,"
That must hurt
But it wasn't all plain sailing for Trujillo,
who endured a lengthy question and answer session from journalists
following his speech.
He was forced to defend Telstra's poor relationship with
politicians and the nation's competition regulator, as well as
the process by which it procures networking and end-user
equipment. The year-on-year decline in Telstra's share price was also an issue.
"Australia is moving towards a performance-based labour
market, and your performance in the last year is a share price
that has dropped about 27 percent while the rest of the market
has gone up by 25 percent," said one questioner.
"Why should you and the rest of your executive team not accept
a 25 percent performance pay cut on the basis of that abysmal
share market performance?"
Trujillo also spent a large part of his speech attacking the
nation's telecommunications regulatory environment that guides
the operations of carriers like Telstra.
He reiterated Telstra's long-standing position that it would not construct its planned national fibre broadband network unless it could get regulatory certainty on the terms of access to the network by competitors.
"Do you accept that part of the reason for the current
regulatory process is that Telstra has the current dominant
position in the market?" asked one reporter.
Trujillo himself also took various swipes at Telstra's
competitors during his speech.
In a reference to Optus' parent company SingTel, he said
Telstra was not prepared to subsidise shareholders in the
Singaporean carrier by allowing others to use its planned fibre
network at prices below Telstra's own cost.
The group -- AAPT, Internode, iiNet, Macquarie Telecom, Optus,
PowerTel, Primus, Soul and TransACT -- claimed Telstra's planned
fibre network would reach less than half of Australians, in
effect creating a two-tiered system for broadband access.
"The new high-speed access network would initially cover ...
more than half of all Australian households," said Trujillo, who
claimed the proposal covering only capital cities did not mean "that
we have forgotten the rest of Australia".
He said Telstra expected to expand the footprint of the fibre
network to additional communities if it could get a return on its
"This network would be available at commercial rates to
competitors," he said.