Telstra can't make money out of ICT services

Beverley Head
Tuesday, 17 November 2009 08:45

IT Industry - Strategy

Telstra CEO David Thodey does not believe telcos can make money out of providing ICT services and spelled out clearly today that “We will never become an IT services company.”

Earlier this year Telstra offloaded its ICT business Kaz, selling it to Fujitsu for $200 million and Thodey’s comments today suggest the company won’t be going back into that sector of the market any time soon..

“We are a managed network services company. We will take on more and more responsibility for end-to-end if it is sensible for our customers and it’s a fair return,” but he was adamant that the company would partner with other companies for clients who needed ICT services rather than try to provide them itself.

Speaking at the Gartner Symposium being held in Sydney, Thodey, who had been closely involved with the Kaz business unit and was a lead negotiator in its sale, said that although on the surface many of the skills sets in a communications company and an IT company seemed similar there were some key differences.

He stressed that in some rollouts – unified communications for example; ““I think the complexity of networks is far beyond what most people understand. If you are doing a big UC rollout... there are a lot of moving parts to make that work properly and there are some elements of IT you need. But a lot of it is how the network operates and optimises traffic etcetera.”

Thodey said it was important that the network services team and the ICT services team worked closely together to ensure, for example, that a change made to a network didn’t bring down applications, and similarly changes to applications didn’t bring down a network. But he didn’t believe the two teams needed to come from a single supplier.

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