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Government welcomes Telstra's commitment to investment and infrastructure.



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Senator the Hon Helen Coonan Minister for Communications, Information Technology and the Arts

Media Release

Media Contact: Jane McMillan 0438 690 305

www.minister.dcita.gov.au

128/05 15 November 2005

Government welcomes Telstra’s commitment to investment and infrastructure

The Minister for Communications, Information Technology and the Arts, Senator Helen Coonan, today welcomed Telstra’s announcement that it will invest in a new nationwide 3G wireless network and that it will upgrade its core network to support delivery of high speed integrated services to all customers.

Telstra CEO Sol Trujillo announced the results of his review of the company today including the deployment of a $10 billion next generation IP core network and replacement of the CDMA mobile phone network with a national, 3G/GSM mobile network.

“The Government welcomes new investment in telecommunications infrastructure in Australia, particularly investment that will see people living in rural and regional Australia get access to next generation telecommunications services,” the Minister said.

“We also welcome Telstra’s commitment to innovation and its customers. In an increasingly competitive market, all telecommunications carriers need to look to new services and new networks to keep up with consumer demand for faster and more innovative communications services.”

Rural and regional customers are the big winners from today’s announcement with the new nationwide 3G network offering high speed mobile data services across the country. Telstra has assured CDMA customers that their phones will continue to work until the new network is rolled out.

“Telstra has given a commitment that it will continue to operate the existing CDMA network until this new network provides equivalent or better coverage,” the Minister said.

Rollout on the new CDMA network will commence in 2006, with an expectation that the network will be in place by the end of 2007. Currently 98 per cent of the population has mobile phone coverage and this will be maintained.

“The Government requires Telstra to maintain digital mobile phone coverage to replicate the coverage of the old analogue network as a condition of its carrier licence. These existing legal obligations will remain,” the Minister said.

“The Government will be discussing this new network with Telstra to ensure that Telstra meets its legal obligations to provide mobile phone coverage to regional, rural and remote areas.”

Telstra also announced today it will need to cut its workforce by anywhere up to 12,000 over the next five years.

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“Of course any job losses are regrettable and the Government expects Telstra to handle any redundancies sensitively, but workforce issues are a matter for Telstra, not the Government,” the Minister said.

“We trust Telstra will do whatever it can to assist people to move into new employment and we expect Telstra to fulfil all of its obligations regarding employee entitlements.”

Regardless of the size or make-up of Telstra’s workforce the company must continue to meet its legislative and regulatory obligations.

“These are non-negotiable requirements on Telstra and include being able to meet the requirements of the Customer Service Guarantee, Universal Service Obligation and Network Reliability Framework as well as continuation of legislated requirements such as untimed local calls,” the Minister said.

“The Government’s telecommunications regulatory framework has delivered real benefits to all Australians since 1997. The economy is $12 billion larger than it would have been without competition reforms, small businesses have benefited to the tune of $200 million in 2004-05 and 23,000 jobs have been created.

“The Government is proud of the fact that it provides a robust regulatory regime that has developed telecommunications competition in Australia. The Government concentrates on regulating service delivery for all consumers by all telecommunications companies.”