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What is Telstra and what are their chosen markets?

The name "Telstra" is derived from the words 'Telecom' and 'Australia' (TEL from Telecom and STRA from Australia). Telstra traces its roots back to 1901 at the time of Australian Federation. The Postmaster General's Department of the time was established by the Federal Australian Government to manage all domestic telephone, telegraph and postal services. Subsequently it merged with the Overseas Telecommunications Commission formed in 1946 to manage international telecommunications services.

Telstra first became a publicly listed company in November 1997. Telstra was progressively privatised (33.3% 1997, 16.6% 1999, 33.3% 2006, with 17% transferred to the 'Future Fund'. Today Telstra is still Australia's leading telecommunications company, serving a diverse range of customers: small business. large enterprise, government organisations and -of course- ordinary consumers. The 'product ranges' covered by Telstra include:

i/ Mobile: Prepaid and postpaid mobile services, handset sales, mobile broadband, internet of things (IoT), and wholesale services providing Mobile Virtual Network Operations (MVNO) to third party mobile market players.

ii/ Fixed (Consumer & Small Business): Telstra is in a process, (close to completion) of handing control of their legacy copper network, and some early technology fibre, over to 'the nbn', a state owned and controlled 'National Broadband Network'. In instances where the former Telstra fixed network overlaps the nbn fibre network, the older network may be retired or alternatively integrated into the new nbn 'parent network'. Meanwhile the fixed network contains legacy voice and broadband. But it also includes income from online business apps and services, gaming services (exclusive Australian access to the Xbox All Access on line gaming platform), pay television (Foxtel subscriptions- including Kayo sport) and SVOD (subscription video on demand- including Kayo 'one off' Sporting Events).

iii/ Fixed Enterprise: Data and connectivity and traditional calling applications are the base products. In addition Network Added Services (NAS) for these larger business and government customers are available. NAS includes cloud applications, equipment sales, professional services (including infrastructure builds and digital transformation projects) and managed services. Security services, as an over-layer above other applications, are a 'growth area'.

iv/ Fixed - Active Wholesale: Largely data and connectivity to third party retail players on the legacy Telstra network, prior to that part of the network transitioning to nbn.

v/ International: Providing international services (including legacy international toll calls) with international assets, and now including Digicell's South Pacific business (Acquired July 2022). Digicell Pacific is a leading provider of communications services across Papua New Guinea (PNG), Fiji, Nauru, Samoa, Tonga, and Vanuatu. The international division also owns Telstra's share of the different sub-sea intercontinental telecommunications cables that connect Telstra to the rest of the world.

vi/ InfraCo fixed: This business unit involves the design, construction, operation, maintenance, and the relocating and rationalising/decommissioning of passive infrastructure assets: Legacy copper line assets (but with some HFC (Hybrid Fibre Co-axial) older technology fibre thrown in too), ducts, pits tunnels, poles and certain fixed network sites (including data-centres). It also contains ongoing income related to the 'DA' ('Definitive Agreement' with nbn). One off DA income includes receipts for disconnecting customers from the legacy Telstra network, and one off receipts from customers connecting to the nbn network. To counter that reducing income stream, recurring DA income from nbn includes payment to access Telstra owned ducts, racks and fibre. One important category of infrastructure hardware -not under the wing of InfraCo- are the mobile network towers.

vii/ Amplitel: This is a special purpose infrastructure vehicle, now only 51% owned by Telstra, that constructs, maintains and upgrades for new services (like 5G) -what was formerly the 'fully owned in house'- Telstra mobile tower network.

viii/ Other: This includes 'Telstra Health' (digital health infrastructure for health providers, and software solutions for the same), 'Telstra Energy' (a retailer of electricity bought from third parties, in what looks like a mechanism to offer 'one party utility billing' for customers who want that) and 'Telstra Purple' (offering adjacent technology for existing Telstra network capability). One product from 'Telstra Purple' called "Branch Offload" will use a range of technologies, including Telstra’s 5G and fixed connectivity, Microsoft Azure (a cloud computing platform) Stack Edge (Microsoft Azures cloud storage gateway) for edge computing (Note 'edge computing' is a term used for processing time sensitive data), Secure Edge (provides users with consistent and secure access), SD-WAN (Software Defined Wide Area Network) and service orchestration. And all of this is delivered as a managed service from 'Telstra Purple'.

ix/ Equity Investment Telstra is joint owner (35%), together with Newscorp (65%) of NXE Australia, trading as Foxtel, a pay TV operator. Foxtel operates using cable television, satellite television, and IPTV (Internet television) operator. What does the name mean? "Fox" represents News Corporation's 'Fox Network Television' and "Tel" representing Telstra. Foxtel transmits its cable service via Telstra hybrid fibre-coaxial (HFC) cable into the Brisbane, Sydney, Melbourne, Adelaide and Perth metropolitan areas, along with the Gold Coast. Foxtel's satellite service covers the rest of Australia. Foxtel on Mobile launched on Telstra's Next G Network in late 2006. Netflix is the market leader in pay TV in Australia (December 2019 figures, Roy Morgan) with 11.9 million subscribers. At the same date Foxtel had 5.5million subscribers. Third in this market is Australian-owned Subscription TV service Stan, which is now accessible by more than 3.3 million Australians. Stan is a fully owned subsidiary of the Nine Entertainment company.

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