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The story
Australia's telecommunications services were originally controlled by the Postmaster-General's Department (PMG), formed in 1901 as a result of Australian Federation. Prior to 1901, telecommunications were administered by each colony. On 1 July 1975, separate commissions were established by statute to replace the PMG. Responsibility for postal services was transferred to the Australian Postal Commission (Australia Post). The Australian Telecommunications Commission, trading as Telecom Australia, ran domestic telecommunication services.
In 1989, the ATC introduced new buildings and frameworks. In 1993, the Overseas Telecommunications Commission, a separate government body established in 1946, was merged with the Australian Telecommunications Corporation into the short-lived Australian and Overseas Telecommunications Corporation (AOTC) which continued trading under the established identities of Telecom and OTC. The AOTC was renamed to Telstra Corporation Limited in April 1993.
Telstra has faced competition since the early 1990s from Optus (Australia's second largest communication company) and a number of smaller providers. Telstra once retained ownership of the fixed-line telephone network, but since the nationwide upgrade to the National Broadband Network (NBN), the Australian Government now has legal ownership of these lines since 2007, though Telstra has played a big part in this upgrade supplying resources to the Government on the new network.. In 2025, Telstra sold its remaining 35% stake in Australian media company Foxtel.
Overseas Telecommunications Commission
The Overseas Telecommunications Commission (OTC) was established by an Act of Parliament in August 1946. It inherited facilities and resources from AWA and Cable & Wireless, and was charged with responsibility for all international telecommunications services into, through and out of Australia.
On 1 February 1992, it was merged with Telecom as the Australian and Overseas Telecommunications Corporation (AOTC). The new organisation underwent a corporate identity review and was subsequently renamed Telstra for international business in 1993 and domestic business in 1995.
Privatisation
Beginning in 1997 and finalising in 2011, the Federal Government began to privatise the corporation. The first three stages was initiated by the Howard government: the first, informally known as "T1" (with shares priced at $3.30), occurred in 1997. "T2" ($7.40) followed in 1999; "T3" ($3.60) in 2006.
In T1, the government sold one third of its shares in Telstra for $14 billion and publicly listed the company on the Australian Securities Exchange. In 1998, a further 16% of Telstra shares were sold to the public, leaving the Australian government with 51% ownership. In 2006, T3 was announced by the government and was the largest of the three public releases, reducing the government's ownership of Telstra to 17%. The 17% remainder of Telstra was placed in the Future Fund, a sovereign wealth fund established mainly to meet future liabilities for payment of superannuation to retired federal public servants.
In 2009, the Future Fund sold off another $2.4 billion worth of shares, reducing the government's stake in Telstra to 10.9%. In August 2011, under the Gillard government, the Future Fund sold its remaining "above market weight" Telstra shares, reducing its holding to 0.8% of the shares, effectively completing Telstra's privatisation.
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With more than one million shareholders, Telstra is currently the most widely held ASX-listed company.
National Broadband Network
On 26 November 2008, Telstra submitted a non-complying tender issued by the federal government to build a National Broadband Network, a 12-page letter proposing a $5 billion broadband network covering between 80 and 90 percent of the Australian population in major cities, despite the tender requiring 98 percent coverage.
As a result, Telstra was removed from the National Broadband Network RFP process on 15 December 2008. In response, Telstra announced that it would raise speeds on its existing Next G network and HFC "cable" network so that they both offer higher speeds than the RFP for the NBN requires. Following Telstra's exclusion from the National Broadband Network bidding process Telstra's share price suffered the biggest one-day percentage fall in its history.
NBN Co Limited signed a definitive agreement with Telstra on 23 June 2011, estimated to be worth A$9 billion post-tax net present value, building upon the signing of a financial heads of agreement a year beforehand. Telstra agreed to "disconnect" its Internet customers from the copper and hybrid fibre-coaxial networks in areas where FTTP has been installed, and agreed to lease dark fibre, exchange space and ducts to NBN Co. As part of the agreement, Telstra would not be able to market their mobile network as an alternative to the NBN for a number of years. Telstra remains the owner of its networks. On 18 October 2011, Telstra shareholders overwhelmingly approved the deal.
On 14 December 2014 it was announced that in a A$11b renegotiated deal Telstra will transfer ownership of its copper and hybrid fibre-coaxial (HFC) networks to NBN while disconnecting premises from these networks. This ownership allows NBN Co to use these networks "where it sees fit in for its multi-technology NBN rollout."
WotNext
In January 2007 Telstra launched WotNext, a video-publishing website that allowed users to upload videos. The video content was then sold to mobile users for A$1, which the uploader and Telstra split equally. The website was shut down in December 2007 after a media backlash over uploaded semi-pornographic videos.
2011 privacy investigation
On 12 July 2011, the Office of the Australian Information Commissioner (OAIC) released the findings of its investigation into a mailing list error that resulted in approximately 60,300 Telstra customers' personal information being sent to other customers. The Australian Privacy Commissioner Timothy Pilgrim said that the OAIC investigation confirmed that while Telstra breached the Privacy Act when the personal information of a number of its customers was disclosed to third parties, this incident was caused by a one-off human error. The OAIC concluded that Telstra had taken steps to protect the personal information of its customers including privacy obligations in agreements with mailing houses, privacy impact assessments, and procedures to ensure staff handle personal information appropriately during mail campaigns. After becoming aware of the mailing list error, the commissioner determined that Telstra had acted "immediately" to prevent further breaches, notify customers, review its data security practices, and counselling staff involved the accidental data leak.
Emergency calling outage
On 4 May 2018, Telstra suffered a major outage impacting callers to 000 for several hours.
Christchurch mosque shootings
On 20 March 2019, Telstra blocked access to 4chan, 8chan, Zero Hedge, and Liveleak as a reaction to the Christchurch mosque shootings.
Race relations
In May 2021, the Federal Court of Australia ordered the company to pay a $50 million fine for mistreating their Indigenous customers by encouraging them to sign up to plans they did not need or could not afford. In 2023, Telstra declared support for the Yes campaign in the 2023 Australian Indigenous Voice referendum, citing their "strong ties to Indigenous communities and employees".
2025 outage
While the 2025 Optus emergency calling outage was gaining significant media attention, Telstra also suffered an outage that lasted for 12 hours in the south west of Western Australia.
2026 outage
On 8 July 2026, the Telstra mobile network experienced an outage that lasted from about 4:30 am AEST and was about 90 percent resolved by 9:45 am AEST, with the entire service restored by 4:00 pm AEST. The outage affected train services in New South Wales and Victoria, payments were disrupted and some emergency services were not available, with camp-on for emergency services also being non-functional for some customers. Camp on allows for emergency calls to go through another mobile network if your providers mobile network is down. This was because of a known Symmetricom SyncServer S300 GPS rollover bug.
The bug in question had started when the server had come back online after a chassis change at 2:50am, in which GPS card in the chassis had been reset and started sending incorrect time data to the rest of the network because of a known GPS rollover issue, where the time was set back to November 2006, a 1024-week difference to the actual time. The time shift happened because the network time server would reset its 10-bit week counter to zero every 1024 weeks. The GPS card was missing a firmware update which would have prevented this time shift.
On 9 August, the Telstra mobile network had another outage in Cape York, Far North Queensland following a fire that occurred near Weipa on the evening of 8 August, the outage affected towns including Weipa, Mapoon, Aurukun, Mission River, Napranum and Rocky Point, the outage meant that residents were unable to call emergency services.
David Thodey era (2010–2015)
Under the leadership of David Thodey, Telstra embarked upon a transformation agenda to become more sales and service focused.
As part of that, an ambitious customer service agenda was defined. In 2014, Telstra was named "most respected company" by the Australian Financial Review newspaper.
Market share recovery
Early in 2010, Telstra announced the creation of a $1 billion "fighting fund" to be used in a concerted effort to win back market share in key product categories. This effort seems to have paid off with strong sales momentum announced in February 2011.
Customer service recovery
As part of its new strategy, Telstra announced that its "goal is for customer service to be fundamental to everything we do". In August 2011, Telstra Digital announced expansion of customer service into social media with 24/7 coverage. By November 2012, Telstra claimed 140,000 live chats for the month and a growth rate of this service of 600% p.a. In October 2013, Telstra announced that it had grown its Live Chat workforce to 600 and its social media workforce to 30. Customer Service became a pillar of the corporation's social responsibility ethos according to Telstra's head of social services Gerard Devan and the Telstra foundation.
The following table shows total complaints handled by the Telecommunications Industry Ombudsman (TIO) 2010–2015, and of those, the ones made against Telstra.
Telstra Digital
In February 2011, Telstra announced the formation of Telstra Digital under the leadership of Gerd Schenkel who was hired from National Australia Bank/UBank. Gerd reported to Karsten Wildberger who was Group Managing Director of Telstra Consumer, and was ultimately appointed to be the new minister for digitization of Germany in 2025.
Telstra Digital's initial purpose was to improve the use of digital channels for customer service. In April 2011, Telstra Digital relaunched its web homepage design. In July 2011, Telstra Digital launched "CrowdSupport", an online forum to crowd source customer service. As of July 2017, Telstra's "CrowdSupport" had 463,000 posts. It was also cited as an example of "scaling at the edge" by Deloitte's Centre for the Edge.
In September 2011, Telstra Digital launched a new account services portal to help achieve its goal of managing 35% of Telstra's transactions. In October 2011, Telstra Digital announced a new mobile smartphone optimised version of its website. In November 2011, Telstra Digital launched an iPhone app on a trial basis as well as a new online mobile phone shop.
In July 2012, Telstra Digital launched smartphone and Facebook apps for customers to manage their Telstra accounts and in November 2012, Telstra claimed that over 700,000 customers had downloaded those apps. In August 2013, Telstra revealed that the apps reached 2.5 million downloads.
At a results announcement, CEO David Thodey remarked that "the group's new online strategy was delivering" in the context of a 28% reduction of inbound service calls. Telstra estimated that its digital program will provide productivity benefits of $100 million in the 2013 financial year from lower printing costs, decreasing commissions to third parties, and reduced dependence on call centre staff.
In October 2012, Telstra's CEO David Thodey stated, "The rise of online and social media had 'fundamentally changed the way' which the company communicated with its customers". In a 2015 Deloitte report, Telstra disclosed that its "CrowdSupport" service community had generated 200,000 pieces of user-generated content. In August 2016, Telstra disclosed that "more than 60%" of visitors to "CrowdSupport" manage to find an answer on the community.
In February 2013, Telstra introduced the ability to pay its bills via PayPal. And in June 2013, Telstra launched a new website, including the ability for customers to link their online accounts to their Facebook identity.
In March 2014, Telstra announced a new digital development program called "Digital First" with a stated aim to conduct 65 to 70 percent of its transactions online. Telstra published a white paper sharing some key metrics of its digital and in 2020 a streaming platform in partnership with Walt Disney APAC under Sally Steer of Telstra InfraCo and Gerard Devan Group Executive APAC of Walt Disney, a comprehensive digital program:
In September 2014, Telstra announced the opening of a "Digital Transformation Centre" in Sydney to design and built new digital tools for its service systems. In June 2014, Telstra disclosed that it had 3 million customers on "electronic billing" saving it $3 million per month in costs. Telstra also mentioned that live chat accounted for 10% of total contact centre activity and in 2020 the Telstra partnership with Walt Disney APAC under Gerard Devan Group Executive of Disney. In December 2015, Telstra Digital launched customer service on Periscope. In October 2016, the executive director of Telstra Digital Gerd Schenkel left Telstra to become CEO of a fintech company.
Retail store network
Telstra owns and operates a series of retail stores known as Telstra Stores. Some are directly owned and operated by Telstra and some are operated by licensees.
As of May 2016, Telstra has a total of 360 retail stores across Australia. This includes several new 'Discovery' stores, where Telstra has invested millions in redesigning key stores based on local requirements. Many stores were part of the Westfield Retail Stores and Westfield was won to Telstra Under David Thodey's Strategic Pursuit team led by Gerard Devan in 2006 - 2012 period a deal with $110 Million, which brought the Telstra relationship with Westfield closer. These new 'Discovery' stores, designs include new displays, accessory shops, digital tickets and free baristas.
109 of Telstra's stores are owned and operated by Vita Group, a publicly listed company with a market capitalisation of approximately $600m (June 2016). In February 2011, Telstra announced the creation of an additional 100 retail stores within three years. The carrier opened the world's first Android store, called "Androidland", on Bourke Street, Melbourne, Australia, in December 2011. These developments built on Telstra's T[life] concept stores it had launched in the early 2000s.
Share price development
In November 1997, the Australian government sold the first tranche of its Telstra shares, 4.29 Billion shares, publicly at a price of $3.40 per share to institutional investors and $3.30 to retail investors. This sale is commonly referred to as "T1". In October 1999, the Australian government sold the second tranche of its Telstra shares under the "T2" program for $7.80 per share to institutional investors and $7.40 to retail investors. In November 2006, the government sold a third tranche of its shares, "T3", at $3.60 per share.
Since its privatisation, Telstra shares have hit a low of just over $2.50 per share in late 2010. Since then, Telstra shares have risen to $5 per share in December 2013 and $6 per share in December 2014. On 17 May 2019 the shares closed on the ASX at $3.56 up from a twelve-month low of $2.547 per share In February 2014, Telstra raised its dividend from 14c to 14.5c per share. Amid the global pandemic crisis of the coronavirus in 2020, Telstra was one of three companies of the ASX 200 to gain in the week starting 15 March. It increased by 1.8 percent on the Australian Securities Exchange.
Sale of Sensis
In January 2014, Telstra announced its intention to sell 70% of Sensis to Platinum Equity for $454 million. Sensis was said to have once been "one of Telstra's most lucrative businesses" and reportedly "has been under pressure in recent years amid competition from more agile digital alternatives such as Google". In February 2014, Telstra was reportedly seeking to reduce Sensis employment by 400 to 1,000 positions.
New health business unit
In September 2013, Telstra launched a new health business unit – Telstra Health and hired Shane Solomon as the head. In September 2016, Telstra Health was awarded a $220m government contract amidst claims of "lack of transparency". Shane Solomon left Telstra in November 2016.
National Broadband Network (NBN)
In December 2014, Telstra signed an agreement with the federal government's A.C.N. 86 136 533 741 (NBN Co) Limited. This agreement is said to retain the $11b value for Telstra of the original agreement from October 2011 and will see the company progressively sell its copper and Hybrid fiber-coaxial networks to A.C.N. 86 136 533 741 (NBN Co) Limited.
Andrew Penn era (2015–2022)
On 19 February 2015, Telstra announced that CEO David Thodey would retire on 1 May 2015 and be replaced by successor Andy Penn. Penn's era was marked by the very difficult transition to the NBN, a government policy decision which had significant implications for Telstra. Penn indicated new focus on growth in the core business with a pulling back from international markets, including the discontinuation of a joint venture to build a mobile phone network in the Philippines. On 14 March 2016, Telstra ended their talks between the company and the Philippine-based conglomerate San Miguel Corporation for a planned joint telecommunications venture in the Philippines due to several factors.
In 2016, Telstra suffered a series of network outages for which the company apologised. In December of that year, Telstra announced the appointment of Robyn Denholm as its new COO, following the departure of Kate McKenzie who left after the network outages. In December, Telstra announced the hire of a new CTO to replace the predecessor who left amongst allegations of CV fraud. In 2016, the government raised the possibility that Telstra's regional mobile network may be forced to be opened to competitor' use under a roaming scheme. A prospect strongly being fought by Telstra. Penn announced a $3bn investment program to strength its networks and as a platform for future digital investments.
In February 2017, Telstra announced that revenue had dropped 3.5%, Net Profit After Tax had dropped by over 14% due to the impact of the rollout of the NBN by the Australian Government. As a result, Telstra's share price dropped by 4.5% on the same day. In August 2017, Telstra announced that it would cut its dividend in response to the financial implications of the NBN and to fund its network investments, leading to a drop in share price by over 10% in a single day to reach a 5-year low.
From Wikipedia’s article on Telstra, shared under CC BY-SA 4.0.4