Telstra serious about Asia play

• Acquired Pacnet in 2014 to boost regional presence
• SMEs a major part of Telstra’s customer focus in Asia

IT is a tale as old as time: A non-Asian company aims to bolster its presence in the region by acquiring an Asian company to bolt on to its operations. From there, the tale can go either way, and Telstra is hoping that it will get its fairy-tale ending.
 
Telstra has already been in the Asian market for quite a while, but its acquisition of Hong Kong- and Singapore-based data centre player Pacnet in December 2014 signalled more ambitious intentions for the region.
 
It’s not that the Australian telco giant was any stranger to operating internationally, according to Jim Clarke (pic), director of its Global Enterprise & Services International unit.
 
“Telstra has more than 70 years’ experience operating internationally, and several decades in South-East Asia.
 
“In some markets, including those in South-East Asia, we continue to be a challenger, but … our international business recorded 44% revenue growth in the last financial year.
 
“The acquisition of Pacnet doubled our customer base in Asia,” he told Digital News Asia (DNA) via email.
 
The acquisition also bolstered Telstra’s network capabilities and staff levels, according to Clarke.
 
“Now we have more than 400 staff across Singapore, Malaysia and Indonesia, and we own and operate the largest intra-Asia subsea network system, representing about 30% of active capacity in the region,” he said.
 
“On the network side, [the acquisition] added 40,000km more of subsea fibre cables and an additional 29 data centres, all in strategically important areas in Asia Pacific, as well as four wholly-owned cable landing stations directly connecting the Philippines, Hong Kong, Taiwan and Singapore.
 
“In Singapore, we now have additional assets including the Cloudspace data centre,” he added.
 
The acquisition also allowed Telstra to consolidate its offerings into a single product catalogue, according to Clarke.
 
“We now have one single product catalogue that brings ‘the best of both worlds’ together,” he declared.
 
“Moving forward, we are focused on consolidating the Telstra and Pacnet networks, which will provide improved network reliability with more routing options, unique routes, lower latency on major Asia routes versus our competitors, and the ability to scale more capacity on demand,” he added.
 
That consolidation also includes staff, and now Telstra has an expanded team in Asia to deal with customers locally, according to Clarke.
 
“We have successfully brought together 1,800 team members from Telstra and Pacnet into an integrated team, and we have expanded our workforce in Singapore and Malaysia.
 
“Our call centre in Malaysia can offer support to our global customers in five languages – Mandarin, English, Cantonese, Japanese and Korean,” he added.
 
The SME pie
 
Despite Telstra’s core customers being multinational corporations, Clarke believes that SMEs (small and medium enterprises) in Asia will emerge as its new growth market.
 
“From an SME perspective, one important market in South-East Asia is in Indonesia, where we have a joint venture business with Telkom Indonesia called TelkomTelstra,” he said.
 
“Through TelkomTelstra, we are developing managed ICT solutions – including managed network services, professional services, cloud and unified communications – to help businesses grow in Indonesia.
 
“Since it was formed in 2014, TelkomTelstra has been developing its product suite and presence in the Indonesian market.
 
“Last year, it began signing its first customers and launched Indonesia’s first Customer Experience Centre, showcasing the latest network application services,” he added.
 
However, Telstra is not neglecting its existing corporate customers, according to Clarke, seeing opportunities with them as well.
 
“Our customer base is mostly multinational corporations with a presence in several countries,” he said.
 
“We see lots of potential to expand our business with this segment, especially among companies with growing and diverse interests in Asia,” he added.
 
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