Telstra announces network investment after months of issues for customers

Telstra CEO Andy Penn today announced via a Blog Post today that the company has allocated $250 million of its capital expenditure for the new financial year to network improvements directly related and in response to the recent issues and outages on their mobile and ADSL networks.

Penn’s blog post goes hard to reassure customers that he and the company take their network seriously “Over the past few months we have experienced some network interruptions that have impacted you, our customers. All of us at Telstra are deeply sorry for the inconvenience this has caused.”

He then went on to highlight where the money would be spent saying Telstra would be “investing $250 million from our existing capital program, within our 15% capex to sales ratio, over the next 6 to 12 months to provide a higher degree of network resilience and improved network performance.”

He outlined the investment would be in three key areas:

• enhancing the mobile network’s resiliency, to improve recovery time and create more effective real time monitoring
• improving reliability and resiliency within the core network
• increasing current ADSL broadband capacity to meet increasing customer demand

EFTM spoke to Andy Penn today in and asked how it compared to previous years investments, and how therefore an average customer would and could compare the investment year on year.  He couldn’t say directly.  Only to say that the investment was within the constraints of existing capital allocations.

The announcement today is really a mechanism to get customers back on side, to see that Telstra is trying to respond to the outage.

No doubt there are internal departments fighting for their own allocation of capital each and every year, this year would be no different, but for the team responsible for the mobile and core networks the fight would have been quite easy this year.

Don’t expect a trouble free network guarantee from Telstra, this investment works to improve “redundancy” and “resilience” on the network, in particular when they have issues which results in large numbers of customers being disconnected and having to reconnect on mass.

The end of financial year is drawing near, and when Telstra announces their results they will be forced to address questions of customer retention.  No word today if all these issues have resulted in customers switching networks, but we will find that would in the months ahead.

For now, Customers have to hope that this prioritisation of capital, though not an increase in overall spend – will improve the network should they have any further large scale outages.

Here’s the full text of Andy Penn’s blog post at Telstra Exchange:

Improving network performance

At Telstra we are fiercely proud of our network leadership. It is a network in which we have invested billions of dollars over many years to provide the best experience for our customers. 

I know many of you have chosen Telstra because we have the best network. This is increasingly important in a world where you use our network to do more and more every day, and where other companies use our network to provide new services to their own customers. 

We see this through the volume of traffic on the network, which has grown significantly. This dynamic is only going to increase over time with the rate and pace of technology innovation that we are all experiencing.  

I am writing this note today to update you on what we are continuing to do to address these issues.

In May we announced the results of a review into our mobile network. We are very advanced in implementing the recommendations from that review. We have also recently completed an end-to-end review of our core network and IT systems, pinpointing sources of potential risk. 

These are important measures and I want to assure you that I am committed to do everything we can to strengthen our network for you. 

All network operators around the world face the risk of disruptions whether they be the consequence of weather, accidental damage, hardware or other failures. What I am committed to though is continuing to invest in building the durability and capability of our network, and in our ability to respond quickly if things do go wrong to minimise the impact on customers. For example, changes already made mean that our recovery time on the mobile network has been substantially improved.

What I can also assure you is that we are spending a lot of time working on the network of the future and imagining a world where you will be even more connected, with more devices and services taking advantage of more that the network can offer. The investment I am communicating today is an important step in building the platform for these plans which I will share with you later in the year. 

More than ever, our devices allow us to connect with family, friends, work, entertainment, apps and services and other devices. We recognise this and we are committed to delivering the network which gives our customers the best experience.