Telstra shuffles leadership deck, steers toward Asia

Telco has no option but to pursue Asian market, says Thodey

Telstra CEO David Thodey looks toward Asia.

Telstra CEO David Thodey looks toward Asia.

Telstra CEO David Thodey has announced a realignment of its senior executives and an increased focus on Asia.

Among the leadership changes, which are effective Monday next week, Brendon Riley has been appointed group executive of global enterprise and services. The $5 billion revenue business unit will include network application services, global applications and platforms, a new cloud division, ventures, enterprise and government and defence.

Kate McKenzie has taken Riley’s previous role as chief operations officer, which now includes the chief technology and innovation portofolios. She was previously managing director of the products and marketing group.

Gordon Ballantyne has been appointed group executive of Telstra retail, which brings together retail-facing segments including Telstra Consumer, Telstra Business, the chief marketing office and NBN product, sales and marketing. He was previously chief customer officer.

“This is really around strategy,” Thodey said. We have got to focus in on those key areas of driving growth from the core and this key growth area around global enterprise and services.”

The executive shuffle follows the announcement of a restructuring that will see Telstra add jobs in areas like network applications and services while cutting 1100 jobs from its operations workforce.

Citing the Asian Century as a major opportunity for Telstra, Thodey said the telco will take a “considered” look at expanding its business in that region.

“The reality for a company like Telstra is that we must become more and more involved in Asia,” said Thodey. “We just don’t have an option.”

Thodey said that he will work with Telstra CFO Andrew Penn and international group president Tim Chen on the telco’s Asia strategy.

From a technology perspective, Thodey said he sees digital media, global applications and platforms and eHealth as “emerging opportunities” for Telstra.

Earlier this week, Telstra revealed that it would spend $800,000 a year funding seed-stage startups through an incubator called muru-D. Prior to the startup announcement, the telco’s CIO Patrick Eltridge said working with startups is a “strategic necessity” for Telstra to survive increasing competition from over-the-top players and other rivals in a post-NBN world.

However, Thodey stressed that Telstra’s core focus will remain telecommunications and it will continue to invest in its network. Thodey said earlier this month that Telstra will maintain big spending on the 4G network.

“We must continue to invest,” he said today. “We must continue to have leadership in our network topology, in how we run our networks, while still investing in these growth areas.”

“We see more value differentiation in the core of the network rather than less. The days of people saying ‘dumb pipes’ is gone because it is not dumb pipes. They are very intelligent and more intelligence is going into the network than at any other time in the history of this industry.”

Thodey said he could not provide much information on NBN negotiations while the federal government conducted its 60-day review. However, he said that Tony Warren, group executive of corporate affairs, will again lead Telstra’s negotiations with the government.

“The value from the existing contracts is what we will maintain, and then if there’s anything incremental to that, [it] must be done a commercial basis.”

“We’ve always assumed that the copper would be disconnected. Therefore, as we move forward there’s a lot of considerations about—if they want to use the copper to the node—exactly all the details that go with that.”

Asked about the announced sale by Telecom NZ of its AAPT assets and the possibility of a Telstra rival taking them, Thodey shrugged.

“That infrastructure has been out there for a while. It’s not a concern to us,” he said.

“We obviously look at all assets that come onto the market, and if we felt it was appropriate and the regulator was OK with it, we’d look at it. But no, there’s nothing particular in that we’re concerned about at the moment.”

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