Telstra and TPG have appealed against the decision, hoping to overturn the regulator’s ruling. It’s shaping up as the first big regulatory test for Brady, who took the reins at Telstra last September, and last month delivered a decent set of numbers for the first half of fiscal 2023.
Brady said that while sharing its infrastructure with TPG offered an easier path to delivering better regional mobile services, Telstra was committed to regional services even if the deal was nixed for good.
“We are already a big investor in regional Australia; this deal is a great way for us to continue to innovate and provide the best possible experience in regional Australia,” she said.
“If it doesn’t go ahead we are committed to investing in the regions, and that won’t change.”
But government co-funding programs were critical, Brady said.
“We are a big landmass and delivering mobile coverage is not always economic; there are areas where you need co-funding, and we are the biggest contributor to government co-funding programs, and we will continue to do that.”
Optus is vehemently opposed to the deal, which it says will further entrench Telstra’s dominance in the market, diminish TPG’s competitive edge and remove any incentive for Optus to invest in regional networks.
Just how serious Optus is about pouring money into regional infrastructure remains to be seen, but the one clear thing is that demand for reliable, high-speed internet in rural and regional area has never been higher.
Plagued with mobile black spots and deprived of choice, rural and regional consumers are hungry for options. Elon Musk’s satellite business Starlink has picked up almost 100,000 active Australian subscribers in just two years since its launch and more than100,000 customers are plugged into the NBN Sky Muster satellites.
Brady is a fan of Starlink, and said low earth orbit (LEO) satellites had shown how quickly new technology could be used to deliver services.
“Starlink has been incredibly successful in remote areas … the LEO innovation delivers a great experience and people are choosing that option even though it’s not cheap.”
With homes and businesses happy to pay a premium, the economics in regional Australia is starting to slowly stack up for the telcos, although government co-funding will remain a factor in improving service quality.
And Telstra’s renewed focus on innovation, a term admittedly thrown around quite liberally in telco circles, does point to a change in the way competition is playing out in the industry.
Infrastructure-based competition, where telcos were focused on how much ground their networks covered, is giving way to services-based competition.
And that means Telstra will need to pitch itself as a technology-focused telco that’s able to keep its customers connected but also has the capacity to squeeze more value out of it networks.
That extra value in the cities could come through higher prices for mobile and home broadband, and rolling out purpose-built solutions for regional businesses.
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