Telstra pins hopes on cloud after posting $1.6bn half-year profit

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Telstra pins hopes on cloud after posting $1.6bn half-year profit

Braces for spectrum licence costs in the year ahead.

Telstra chief David Thodey says cloud computing is no longer a “glean in our eye” but a critical part of the telco’s business as it invests in new data centres to build on its existing capability.

“We now have 16,000 cloud customers and we’ve had over 3000 join us in the last six months,” Thodey told shareholders, after Telstra posted a $1.6 billion half-year profit.

Revenue from cloud services grew by 25 percent during the half, albeit from a low base.

Telstra flagged significant costs ahead for existing and new spectrum licences, excluding the cost of purchasing new spectrum from its guidance of single low digit income growth for the year.

Despite acknowledging that the impact of the National Broadband Network on its fixed business was not significant, Telstra saw $176 million in revenue from NBN agreements.

Telstra's financial results continued to be dragged down by the group’s digital media business, which includes the ailing Sensis business that saw a revenue fall of 12.5 percent during the half.

Digital media revenue declined by seven percent, as Telstra was unable to grow its digital revenues quickly enough to stem print revenue losses.

Thodey said the telco’s investment in its mobile network was paying off by attracting more customers.

“We have now sold 1.5 million 4G devices and we are on track to expand 4G coverage to 66 percent of the Australian population by June 2013,” Thodey said in a statement. 

Mobile revenue grew by 4.6 percent to $4.5 billion, with more than 600,000 new domestic customers acquired during the half.

Fixed line revenue continued its decline, with growth in fixed broadband not enough to offset the decline in PSTN revenue.

The telco continued to improve on customer service measures, with complaints about it to the Telecommunications Industry Ombudsman declining by 10 percent during the year.

Thodey today focused on improvements the telco had made to its online service capability, revealing there were now 150,000 live customer service chats taking place each month, and two million visitors to its crowd support site.

Thodey also flagged work that is being done to better address the needs of mobile data customers travelling overseas, who he admitted were often ending up with bill shock.

“The expectations of people are enormous in terms of using tablets when they travel now,” Thodey said.

“It’s a tough one but I think we’ve got some ideas going forward that will address that.”

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