Exclusive: Tom Homer on Telstra's plans to conquer Europe
Business Chief met with Tom Homer, Telstra’s inspiring MD for EMEA, to learn how the telco is targeting European expansion while continuing its own transformation into a tech-co offering a range of complementary software products and services.
Australian telecommunications business Telstra is the market leader down under offering a complete portfolio of integrated cloud, data and network services.
Operating nationally for over half a century, and with a UK presence for more than 25 years, foremost in its strategy is the desire to deliver a great customer experience while driving value from the core and investing in new growth businesses close to the core. Telstra boasts 38,000 employees striving to drive value and create simplicity while aiming to be a world-class technology company that empowers people to connect. It is engaged in a shift from the traditional telco model as it endeavours to become a best-in-class tech-co.
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“Customer experience is how we differentiate,” maintains Telstra’s Managing Director, EMEA, Tom Homer. “It’s at the heart of all the important decisions we make. We use NPS (Net Promoter Score) as a way of measuring customer advocacy. That’s an industry standard methodology we’ve been implementing around the world and it’s telling us our customers think we’re getting it right.”
To achieve this customer confidence, Telstra is delivering services supported by over 2,000 staff, mostly based in Australia but expanding globally as its international growth ambition is driven by investing in new businesses close to its core. “That’s been accelerating over the past decade,” explains Homer. “We used to be in a joint venture with PCCW (who were part of the old Hong Kong Telecom) but exited in 2011 to grow an international telecoms business while simultaneously developing our services offering. We’re seeing double digit percentage growth in both of these businesses year on year. Meanwhile in Europe, we’re a B2B business serving large enterprises and other carriers focused at the top end of town with corporate and multinational customers and channel partners in cloud, networks, security and increasingly, professional services.”
We’re speaking with Homer at Telstra’s offices at the Blue Fin Building on London’s Southbank where 200 of its staff are based. He explains Telstra has been engaged in enhancing its network reach by investing hundreds of millions of dollars in network cable systems, points of presence and data centres around the world.
“Networks are still at the core of what we do, but increasingly we’re investing in applications and services over the top of that,” he adds. “We’ve launched a global managed security offering which is an open-source solution making it easier to deploy for multiple customers using the tech we gained when we acquired a software company called Cognivo a couple of years ago. Cognivo software was originally developed for police forces around the world for analysing unstructured data.”
Telstra has also been working with global sports rights company Perform who look after the Women’s Tennis Association tour. Together, they have deployed a Telstra network solution to connect up 50 annual global tennis events over the next seven years.
A key factor in driving the company’s client growth has been the launch of the Telstra Programmable Network: a digital platform for enterprise network services. “We’re approaching 300 customers already, it’s real,” affirms Homer. “There’s a lot of hype in the world of Software-Defined Networking but this is working and happening now. A lot of products get launched but we’ve found success with a new service launched 18 months ago which is now tried and tested. You could describe it as a cloud for networks enabling organisations and customers that use it to dial up bandwidth on demand at the network level,” he explains.
“It means we can give our customers access to cloud platforms through that network at their own locations. It helps them optimise their IT by utilising Telstra’s on-demand service at the core of our network capability.”
It’s a capability that has inspired increased demand for Telstra’s professional services. “We invested in our first services acquisition last year when we bought Company85,” Homer explains. “It’s a UK business with a team of 100 that specialise in helping organisations achieve more with their IT investments. Company85 helped to run the IT department and deliver the IT strategy at London City Airport – everything from the creation and identification of an operating model, helping them get to that point and then executing that strategy. Company85 also have a significant security consulting capability.”
Highlighting Telstra’s need to partner successfully to meet its goal of becoming a tech-co, Homer lists links with the likes of Dell, VMWare and Microsoft. “We also partner with Cisco to deliver collaboration services to customers,” he adds. “A good example of that is Springer, a European publishing company who own brands like Macmillan with a significant presence in the education media space. We’re in the middle of deploying a solution for them to connect up all of their offices for 10-12,000 seats of Cisco cloud collaboration, allowing them to operate seamlessly around the world across 20 countries using voice and video presence.”
Allied to those main partnerships, Telstra is increasingly partnering with organisations that are part of its Telstra Ventures programme. “We have our own branded venture capital fund,” reveals Homer. “Telstra Ventures typically invests in second and third round high growth software businesses, which in many cases are cloud based. We’ve invested in 50 so far and have seen a few exits so this is a real venture capital business. We recently backed a software defined network business, Velocloud, which was subsequently sold to VMWare.”
Telstra also invests in companies delivering digital transformation services. Among these, DocuSign (an electronic document management business) first came onto the company’s radar because of a problem on-boarding new members of staff when employment contracts weren’t being turned around quickly enough. “It was taking 28 days with new starters but DocuSign speeded up that process by 90% and took more than $30 out of each transaction,” remembers Homer. “This delivers innovation for our customers.” Telstra also works with Whispir, a multimedia messaging platform originally designed to help with natural disasters in Australia where droughts, floods, fires and other extreme weather events are commonplace. “In that scenario it’s a way of communicating with stakeholders, customers and employees in one go across text, voice and social media,” says Homer.
While Homer admits brand awareness remains a challenge – he jokes that his company sometimes gets confused with Tesla – Homer is confident in Telstra’s expertise to explore new frontiers for business. “We’ve got a significant global footprint with a real sweet spot in Asia,” he confirms. “A lot of customers come to us for that because they need an Asian specialist. We have a joint venture in China as a majority owner where we’re now the largest foreign-owned IVPVN provider in the country, so lots of very big organisations are coming to us because of our capability in a region where most large multinationals are growing faster than anywhere else in the world.”
Homer is proud that Telstra brings a challenger mentality to the market, delivering a range of software and networks to help organisations in areas requiring regulatory compliance to deal with GDPR (through Company85) and MiFID. “We’ve also been building a foreign exchange platform for a big global bank,” he adds. The company’s global success has strong roots in Asia where it has been operating for over 50 years and has just launched a new offer to provide assured availability on the busiest subsea cable route in Asia – the hot triangle between Hong Kong, Singapore and Japan. “It’s an industry first capability which has led to Gartner rating us top of the league for our high capacity, low latency services in Asia for the last four years running, where ours is a market leading proposition,” says Homer.
Homer predicts the unprecedented era of change for telcos will continue and believes strategically, you need to identify what type of company you are and what you want to become. “Increasingly if you are making the decision to become a tech-co and a services co as well as empowering people to connect by being a network business, you have to invest in partnerships to sell software and services. Our teams are having to become more software savvy because the world of just providing data centres or cables or infrastructure, that world has changed and will continue transforming. Partnering with local organisations is key because we don’t have the scale to serve every customer so our channel programme is vital to build our partner base.”
It’s Telstra’s goal to become more European and grow its footprint across the continent by adding further points of presence (in Copenhagen, Düsseldorf and Paris) to make the Telstra Programmable Network available to more customers while providing access to virtual private networks via Telstra’s IPVPN solution. “Our new office in the La Défense area of Paris will be a hub for our European business… crucial for our expansion across the continent,” says Homer. “We already have entities in France, Germany, the Netherlands and Sweden as well as an indirect channel partnership with IPSILAN, a French technology services consultancy, to distribute Telstra’s Cisco-based unified communications solutions.”
He concludes: “As organisations in Europe look to digitally transform their businesses they are increasingly seeking integrated solutions for their network, security and cloud infrastructure, as well as advice on implementation and management. Our vision is to deliver an advanced network together with value-adding technology services such as consulting, security and collaboration solutions, so businesses in Europe can realise the full potential of cloud computing and meet the rapidly growing demand for data and applications.”
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