Making Communications Technologies Count for Australia

Transcription

1 Making Communications Technologies Count for Australia David Thodey TELSTRA CEO American Chamber of Commerce in Australia 26 November 2009 Page 1 of 23

2 I would like to thank the American Chamber of Commerce in Australia for extending this kind invitation to speak today. It s an honour to be with you on what is a most auspicious day. As you all know, it s the fourth Thursday in November Thanksgiving Day in the United States. A day in which American families gather from all over the country and even all over the world to have dinner and share some important time together. But it is also an auspicious time in the telecommunications industry in Australia, with the Government s visionary National Broadband Network and important reform legislation before the Senate. I must say now that I m sorry to disappoint you, but I can t talk about the NBN today. Telstra is still in negotiations, and much of our discussions are confidential and covered by non-disclosure obligations. Suffice to say, we remain actively and constructively engaged with the Government to find an outcome that is in the national interest as well as the interests of Telstra s shareholders, customers and staff. Page 2 of 23

3 Today, I would like to talk about the growth of the communications industry and how we can all benefit from the exciting opportunities it creates. We need to make communications technologies count for the benefit of Australia. I want to talk about three things today: 1. The world-wide explosion in the use of communications networks and technologies making for a most vibrant and exciting industry. 2. That networks and technologies are at the heart of so much of what we do in Australia at work, at home, in business and are integral to addressing the most pressing challenges we face. For example: o Competitiveness and productivity; o An ageing population; o And climate change 3. That this technology is important, but is only part of the solution to the challenges we face. Technology, on its own, is not a panacea. It is but a platform, not a solution. Page 3 of 23

4 We must build on that platform to drive national reform creating intelligent and practical solutions that meet the current and future needs of government, business and the community.. and it is critical to apply these solutions across the entire economy. That s what Telstra is doing right now. We ve invested $12 billion in a once-in-a-generation transformation of our systems and networks and we are now making that investment count by driving innovation and differentiation across our products and services. Page 4 of 23

5 COMMUNICATIONS INDUSTRY GROWTH It is incredible to see the extent to which communications have grown in recent years and how much it has changed our lives. In many ways it has exceeded our expectations. Who would have guessed that the iphone would have 85,000 applications? Who would have thought that in America the Blackberry is replacing two-way radios as the communications device 1 for police on the beat in Baltimore? Who would have thought that Australia s largest private company, Visy, would shift all of its server operations into a Telstra cloud computing model and save 30% on IT costs in the process? Who would have thought our national leaders would be communicating with us directly via mobile phones, Facebook, YouTube and personal blogs? The statistics on electronic communications usage continue to surprise. Australians are now sending more than 500 million s a day and 50 million SMS messages a day and that number is increasing by double 1 Baltimore Police Department Page 5 of 23

6 digits every year. That is 2.5 SMSes and 25 s for every individual in Australia. And the people in this room are probably contributing disproportionately to this statistic sending on average 10 SMSes and hundreds of s a day! We re downloading 150,000 terabytes a year that s the equivalent of 1,500 Libraries of Congress 2. According to a recent Cisco report on internet usage, by 2012, the Net will be 75 times larger than it was in 2002 and 90% of consumer traffic will be video.. and most of you in this room talk on the phone for at least 1 hour each business day..and total minutes of voice are still growing! We are communicating more than ever and the growth shows no sign of abating. We have never had so much information at our fingertips searchable and instantly accessible. We continue to have an insatiable appetite for information..about each other and generally.and new tools keep arriving, such as Twitter and blogs, to 2 Page 6 of 23

7 whet that appetite. And our children s generation young people in their teens and early adulthood take this access to electronic information for granted and consider online access as the norm and now expect to be able to access this information using wireless when, where and how they want it! Technology is ubiquitous and our usage has become almost unconscious. Let me talk about how that is translating to usage on Telstra networks. Our IP network it is doubling every 19 months. Traffic on our mobile network is doubling every 8 months, And wireless Internet users are doubling every year growing from 2 million to 4 million this year. Name me another industry sector that is growing like this. It is difficult to do so. And the new technology and innovation keeps coming. On December 1, we are enabling a new superfast cable broadband network in Melbourne. Page 7 of 23

8 This Telstra network runs past 1 million households delivering download capacity of up to 100 megabits per second. It will be the fastest broadband network in the country. Internationally, it will be equal in maximum download capacity to Sweden, France, Iceland and Korea and faster than the United States. The new network will enable customers to download high-resolution video in real-time while their family or friends surf the net, play online games or videoconference simultaneously and all still experience superfast speed. For many people, multiple-use capacity such as that will make working from home not just a possibility but a preferred option. It will be fascinating to see how this new capability is used in conjunction with upcoming products such as our next generation home phone, T-Hub, and our first digital set-top box T-Box. The T-Box which we are currently trialling will blend the Net and TV, giving customers access to a library of BigPond movie titles that can be rented, downloaded and watched almost instantly as well as access to the seven BigPond TV channels and digital free to air television. Page 8 of 23

9 In addition, FOXTEL has announced a new IPTV product which will address a different part of the market. T-Hub reinvents the home phone. T-Hub is a user-friendly, flat panel that provides a similar experience to making a call from a PDA with a touch screen. T-Hub will also allow you to: Visit social networking sites like Twitter and Facebook Send SMSes to family and friends Schedule appointments Search on Yellow and White Pages Access Big Pond news, weather and sport T-Hub is also an internet radio and it s even a digital photo frame. This is an exciting and vibrant industry driven by an incredible demand for online access to information and to communicate in new and innovative ways. Tremendous innovation continues to come from this industry and we will see exciting new technologies emerging in the future accessible high definition video, payments systems, voice recognition, health solution, smarter phones.and the list goes on. Page 9 of 23

10 ..communications continues to change the way we live and work. Page 10 of 23

11 ADDRESSING AUSTRALIA S CHALLENGES Networks and technologies are not only great for personal communications and entertainment.. they are integral to addressing the most pressing challenges that we face as a nation. Right now, people are using our next generation Internet Protocol or IP platforms Next G and Next IP to improve health care outcomes, to educate our kids, to cut costs, boost productivity, save the Great Barrier Reef.. and even make our trains run on time. Let me talk about a few examples of what is happening now. 1. Twenty years ago, the way to reform the national railway grid was to make the shift to a standardized gauge. Now, the newest reform of the railway network that runs from Perth to Brisbane has been to shift to standardised communications. The Australian Rail Track Corporation has scrapped its multiple media systems and shifted to one wireless broadband network to run its entire network Next G. Page 11 of 23

12 This has delivered IT savings of 40% and increased the throughput of trains without one extra mile of railway line needing to be laid.and will improve safety including across the Nullarbor. These next generation networks and technologies are transforming industries and corporations.and changing they way services are delivered and how we all work. 2. The same kinds of smart solutions are being found in healthcare, such as the Loddon Mallee Health Alliance using Next G to connect its 18 regional hospitals to specialists in Melbourne via its Virtual Trauma and Critical Care Units E-Health is critically important to this nation and we fully support the Government s initiatives in this area. We must have the ability to seamlessly move standardised health records electronically. It is a difficult but a national effort is required. 3. In environmental management, the Australian Institute for Marine Science is using buoys with waterproof Next G modems to track the water temperature on the Great Barrier up to 70 kilometres offshore in real time. Page 12 of 23

13 That Great Barrier Reef project would not be sustainable without new technologies. It costs $20,000. Using old technologies such as satellite links it would cost $1.3 million. There are many more examples I could give but the point is that, as a nation, we cannot hope to succeed economically, socially or environmentally without these next generational technologies. The alternative solutions simply take too long and cannot be sustained. These networks and technologies are now at the heart of our lives at work, in business and an integral part of the solutions to our most pressing challenges from globalisation to our ageing population to climate change and the reason is because these technologies are an enabler. Page 13 of 23

14 A PLATFORM, NOT A SOLUTION Let me now talk about technology and how to implement it. Technology is not a panacea. By themselves, new technologies achieve nothing. What makes a difference is how those new technologies are applied. Our Next G mobile network, for example, may be the fastest and largest wireless broadband network in the country, but that alone is not innovation. What Next G has done as you just heard from my examples is provide a platform for innovation.. and that innovation is boosting productivity, improving healthcare and helping us understand climate change. Applying new technologies to find practical solutions to the challenges Australians face is central to Telstra s future direction as a business. Our capital investment is moving away from being overwhelmingly infrastructure and network driven 60% of our investments are now focussing on systems, integration, software management tools and content. Page 14 of 23

15 And we are moving away from simple network access and services to delivering integrated and tailored whole-of-business and whole-ofhousehold communications solutions. More and more, businesses and families are demanding end-to-end solutions that are simple, reliable and meet all their communications needs and importantly are delivered by people they can trust. Page 15 of 23

16 THE NEED FOR NATIONAL REFORM So, as a nation, we need to make the most of the incredible opportunities that these technologies create. If Australia is to become more competitive and more productive, and counter the challenges of our ageing population and climate change we need world-class technology solutions and a world-class workforce. To achieve that we need to create intelligent and practical solutions that meet the current and future needs of government, business and the community.. and apply these solutions across the entire economy. This demands investment not just by the telecommunications sector itself, but by every sector of industry and by every level of government. 1. We need to use these technologies to innovate and transform the wider business sector and in critical policy areas such as health, education, environment, transport and energy including communications as a key part of policy reform. 2. We need a renewed national focus on research and development. Page 16 of 23

17 That requires not just coordinating our national R&D effort across business, government and the universities and research institutions, but commercialising and exporting the innovations that flow from those efforts as a nation. 3. And last but not least we need to put skills development centrestage. We need to ensure the Australian people have the technical expertise they need to develop and apply the communications solutions our nation needs. We must ensure we have the skills to use next generation technologies at home, in the workplace and in the community.. because these skills give people the confidence that they need to be more productive in their everyday lives and that personal productivity will translate to national productivity.. delivering the maximum benefit for everyone. We need to drive communications technologies deeply and widely into all aspects of our education system from pre-school to life-long learning. We need digital curriculum and course content that embeds technology throughout the learning experience. Page 17 of 23

18 And, critically, we need to invest in the professional development of our teachers especially those in disadvantaged and remote schools so that they know how to use technology both inside and outside the classroom. These technologies are truly the blackboard of the future. The point I am making is that the reform of industries is actually not dependent on technology the limiting factors are actually more about social issues: The ability to adapt to change The ability to gain alignment with an industry The fair distribution of the benefits created Training and educating users be they consumers, teachers, doctors or engineers.and often these are generational changes. Many of these matters are already contained in the National Reform Agenda which was backed by the current and the previous Federal Government. That s good. It shows there is a good conceptual understanding of what is required to make the leap forward. But this is not just about technology. This is about a holistic approach to change. Page 18 of 23

19 CHANGING TELSTRA Let me discuss Telstra for a moment and how we are changing our focus and using technology. We understand that to maximise the business opportunities created by these new technologies, we have to change. We continue to use new technology to drive productivity and improve our own communications..in our field workforce, which is more productive thanks to new tools; in our T-Life shops; with our new T-Idea online ideas generation forum; and T-Exchange, our new two-way blogging site with our customers. We have to address real customer needs including the changing ways in which our customers are using technology and we have to ensure that our products and services deliver real value for money. That s why we re focused so hard on improving our customer satisfaction and service: Setting a goal to have the best customer satisfaction rating in the industry within three years. Making our staff directly responsible for improving customer service and providing them with the tools and incentives to do so. Page 19 of 23

20 We re also changing our approach to broadband pricing. We have listened to our customers calls for greater value in a highly competitive market. Today I want to take the opportunity to announce new fixed consumer broadband plans for Big Pond customers. As I said earlier, Australians are accessing more and more content on the Internet from their homes often using multiple services at the same time. To maintain and enhance the service quality they ve come to expect, customers need higher speeds and greater download limits. Our new offerings recognise this fact. From Tuesday, many of our customers will get faster speed plans and higher data allowances for the same price. Excess usage charges will be removed on most plans providing peace-ofmind for household budgets. Let me highlight two major changes: There will be 10 times more data allowance on our new entry level plan, Page 20 of 23

21 And there will be new high usage plans of 100GB and 200GB to cater to the growing demand for movie downloads and multiple users at home. We are also introducing new bundle offering savings of $20 to $80 per month when customers use Telstra for their internet, home phone and FOXTEL on a 24 month single bill. These new bundles recognise that families increasingly require a combination of telecommunications, broadband and entertainment in their homes. Our customers are telling us they want more value and that s what we re giving them. Page 21 of 23

22 CONCLUSION In conclusion, we continue to experience a world-wide explosion in the use of communications networks and technologies. The use of communications and the amount of data carried on our core networks is growing exponentially. This change has placed networks and technologies at the heart of so much of what we do in Australia at work, at home, in business. That s why technology is integral to addressing some of the most pressing challenges we face. The challenges of: o Competitiveness and productivity; o An ageing population; o Health, education, transport; and o Climate change As important as technology is, it is only part of the solution to the challenges we face. Technology on its own not a panacea. It is a platform, not a solution. Page 22 of 23

23 That is why it is critical to build on that platform to drive national reform creating intelligent and practical solutions that meet the current and future needs of Australia. And must also focus on the non-technology issues education and skills, R&D, change management, and equitable access to clearly understand where real value is created. Communications technologies are no longer solely the domain of the communications industry. They lie at the heart of virtually everything we do at home, at work and in business. Their power and their potential lies in our ability to apply them in ways that solve the challenges we face. Whether we do this well or not will largely determine whether Australia leads or is left behind in an increasingly competitive global environment. The responsibility to use technology to build a more prosperous nation is one that belongs to us all. We need to make the potential benefits from next generation communications really count to create a better Australia. Page 23 of 23