Telstra has announced its four-pillar strategy for the next three years, with CEO Andy Penn saying the telco has six goals: To improve customer experiences; simplify its products, business, and operating model; extend its "network superiority and 5G leadership"; achieve global high performance in employee engagement; achieve a net cost productivity of AU$2.5 billion by FY22; and attain a post-National Broadband Network (NBN) return on invested capital of 10 percent.
Here are the biggest takeaways from Telstra's three-and-a-half-hour strategy session on Wednesday morning.
Telstra InfraCo: The new wholesale infrastructure company
Telstra announced that it will be establishing an infrastructure business to report financially as a separate segment. According to Penn, it will create "optionality" for a demerger or entry of a strategic investor for post-NBN deployment.
"We are announcing today that we will be establishing a wholly owned standalone infrastructure business unit with its own CEO reporting to me," Penn said.
"The business will comprise Telstra's high-quality fixed network infrastructure assets, including datacentres, domestic fibre, international subsea cables, exchanges, poles, ducts, and pipes. It will provide access to these assets to Telstra through commercial arrangements to drive efficiency and transparency. It will comprise Telstra's commercial activities and existing Telstra wholesale business. It will also continue to provide services to NBN Co."
Speaking on Telstra InfraCo, group executive of Telstra Wholesale Will Irving said it will also include the management of more than 5,000 exchanges and datacentres, along with the access equipment and hybrid fibre-coaxial (HFC) network.
There will be three segments of InfraCo: Telstra wholesale, NBN Co, and Internal Telstra.
Penn said InfraCo will have an initial workforce of around 3,000 employees, with assets worth AU$11 billion; annual revenue of AU$5.5 billion, including