TELSTRA GROUP LIMITED — Call Transcript 2006

Oct 8, 2006

9 October 2006

The Manager

Company Announcements Office Australian Stock Exchange 4^th Floor, 20 Bridge Street SYDNEY NSW 2000

Office of the Company Secretary

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ELECTRONIC LODGEMENT

Dear Sir or Madam

Transcript of presentation by CEO Telstra at the Telstra Investor Day

In accordance with the listing rules, I attach a copy of the transcript of the presentation by Sol Trujillo, Chief Executive Officer Telstra at Telstra's Investor Day 6 October 2006, for release to the market.

Yours sincerely

North brake

Douglas Gration Company Secretary

TELSTRA INVESTORS DAY

6^th OCTOBER 2006

$8.45$ am $-9.45$ am

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SOL TRUJILLO: Good morning, everyone. I would like to thank you all for joining us here today because I believe today is a very important day in Australia's history. It is not a national holiday, but it marks a significant milestone that is likely to be noted I believe in Australia's history. You see, this is the day, 6 October in 2006, that life in Australia will be changed forever. It is going to be changed by a new nationwide high-speed broadband wireless network.

Telstra's new Next G Network will reach around 98 per cent of all It is going to create new experiences for just about Australians. everything that we think about doing in our everyday lives. It is essentially about how you live, how you work, how you play, how you learn, how you can be mobile and again have access to whatever you want to do.

In the past it was only about being able to make and receive voice calls, but now it is about whatever you choose to do. So today Telstra's Next G Network will challenge the tyranny of distance and the limitations of speed.

We are also challenging the conventional wisdom that advanced technology equates to more complexity. As you came in today hopefully you had an opportunity to experience elements of the new world Telstra is creating for Australia.

So I want to take a couple of minutes to preview what is about to happen here in Australia: the only place in the world that this will have happened at this moment in time. We are about to turn on the largest let me say that again; the largest - most advanced ISP 3G broadband network on the planet. We call it Telstra's nationwide Next G Network.

Think about that. Australia is a country that has typically been a follower in the world of telecom. Australia as of today will become the leader in this whole space of wireless broadband. So let me give you some facts surrounding the Next G network available today. Next G uses an 850 megahertz network, one of the world's most advanced mobile services. Next G moves Australia assertively into the 21st

Sol Trujillo

Next G will change the total communication and media century. landscape, I believe forever. Next G is Australia's largest and fastest mobile broadband network. It is again a nationwide network, larger than all the other Australian 3G networks combined, with peak network speeds of up to 3.6 megabits per second today, quickly rising to 14.4 megabits per second by the end of March 2007, and advancing by 2009 to 40 megabits per second.

Now, if you think about the dimensions of that, there is a dramatic shift now in terms of what is possible. The Next G combination of coverage and speed is unmatched and, as I said before. Next G will reach 98 per cent of all Australians. It is 100 times larger and up to five times faster than any of our competitor's services - including our existing 3G services - as of yesterday.

With Next G a three-minute song download takes about 15 seconds to occur, less than one tenth of the time it takes with a 2G phone. We will show you in a little bit how significant and how different the experience really is.

Next G provides content galore. Australia's first mobile TV service with Foxtel will be delivered here, offering 12 channels with BigPond's one click dual download of a music track to both a mobile handset and a computer. Sensis' locate me technology, which matches technology with information requests through the Yellow, Trading Post, City Search and Where-Is mobile services, will all be available as we look at these phones. So, again we are going to make the experience easy, one click simple as we have talked about in the past.

But that's still not enough. In the case of Next G we are going to be providing exclusive content, including BigPond's premium line-up such as AFL, NRL, V8 and now some of the best BBC TV. Next G carries Telstra's "my place" mobile phone menu, which means that watching sports, news or Foxtel is essentially again only one click away along with video calling, mobile e-mail, music downloads and more. Next G handsets are going to be fully featured, including Blue Tooth enabled applications, 1.3 megapixels with cameras with digital zoom, MP3 music players, ring tones, personal organisers and calendars and USB connectivity.

Next G users will be able to access high-speed data in approximately 30 countries, send mobile e-mails and when travelling experience voice and SMS roaming in more than 140 countries worldwide on the GSM's extensive global roaming set of networks. GSM is where the world essentially is. Put another way, Australians are about to experience

speed, coverage and simplicity that is unmatched by anybody else here in Australia.

Now, let me make a second set of observations. Next G isn't just about what I would call incremental improvement in mobility. It is really about new to the world set of capabilities. Next G is in fact about bringing a whole new way of life to Australia.

So consider, for example, what Next G means for health care. Again, here in Australia, consider breast screening. The Telstra mobile breast screening van is already the only connection for women in rural areas to urban screening capabilities. But now it gets even better because the agonising waiting time between the test and knowing the results can be dramatically reduced. Rather than having to wait to travel to a wired site to deliver the screening test, the test can be instantly uploaded from just about anywhere in Australia to the urban medical facility via our wireless broadband.

Only the Next G Network has the coverage - let me say that again; the coverage - and the data capacity to make this possible. Care provided in homes by a physician or other healthcare professionals is now even more efficient than ever with instant access to patient records, diagnostics, uploading of tests and video references for second opinions, for example. The scope of care possibilities is now dramatically increased and the quality of care significantly enhanced. So Telstra is working hard at helping to make national health care services a reality. This is part of that reality shift; not being incremental but fundamentally changing.

So, now as you think about it as a business, what about that? What about this notion of when you have people out in the field, people that Next G has location based capability built into its work all over? network. Therefore, when a service call comes in, the dispatchers can instantly see which service technician is closest to that address. That simple capability can increase productivity and profitability and greatly increase customer satisfaction. We are doing that today within our business.

Next G can also advance enterprise problem solving. For example, a challenger technician may be having trouble diagnosing some sort of problem. They can now quickly share the problem with the entire force in the context of a group video message, and you will see us do a live group video call here.

Well, these capabilities now have not really existed before, not having the infrastructure, the bandwidth et cetera, et cetera. All of these problem-

solving strategies can now be done from places across Australia that until now we could only do by voice. So this really is a seachange in how we deliver business and professional services throughout all of Australia. Any data intensive business can benefit from our next generation 3G network.

So let me give you another example: the Australian Institute of Marine Sciences in Queensland, the people who monitor the Great Barrier Reef as well as marine life in the waters all around Australia. Their important research and analytics depends on continuous data input from remote Next G opens again a new frontier of possibilities for the locations. institute by increasing its ability to upload large files that previously were basically impractical in terms of time and from the remote locations that did not have network access before Next G.

So think about two divers, one carrying the camera - or the camera - and the other one with the microphone interacting with sea life and broadcasting live to classrooms across the country. Think about the kids in the desert discovering the ocean for the first time, interacting in real-time with divers via live video to the classroom. This is the new world of education made possible by Telstra's Next G.

Imagine entire business ecosystems working together in ways never before possible; for example, an architect, a construction company and a materials supplier. It is easy to understand the value of being able to conduct a videoconference from a job site with everyone involved to determine how to respond to a challenge or problems or to just simply clarify specs or to compare blueprints. The time savings, the cost savings and quality controls and enhancements are huge for a business like that.

Next G will change the paradigm for businesses in Australia, no doubt Those changes will increase the productivity and about it. competitiveness of Australian businesses. They will lead to new jobs growth and economic development because we have seen all the studies in the past about when you enhance those capabilities, where you are no longer limited or constrained by space or location, you can do more. So the economic impact of this new network will be measured in the billions of dollars per year well before this decade is over.

But let me give you some examples of what our new network is going to mean for even the simple everyday life that most of us lead. How many of you have been frustrated by losing an important call when you get inside an elevator and the doors close or when you go down into a carpark? We have all experienced that. Well, today only Telstra will be

able to help reduce that frustration with the most extensive in-building coverage available. So, when we talk about coverage, we are not only talking about the geography across Australia but also the geography when we think about all the locations, in-building kinds of locations, that we are into.

Beyond that, only Telstra keeps you connected with the largest roaming network outside of Australia. No more carrying of two phones for those that had been CDMA customers. You only need one. Now, let me be clear; you only need one if that one is with Telstra.

Now consider what we are about to do for TV viewing. With our next generation handsets you are only one touch away from Foxtel TV or your mobile only available from Telstra. But how you experience TV with Next G is the dramatic difference. Compare how quickly you get the TV program you want versus other 3G networks. It is visible, it is noticeable and you can experience it all, and you will here - in a little bit.

Think about how you can watch FoxSports live as you click on your "my space" channels. The nice thing is that you can see it just about anywhere in Australia where people drive or live. Next G makes TV portable, fast and easy to access with fantastic quality, again available across Australia.

Now I'm going to show you something no-one has ever seen before anywhere in the world. This is Foxtel shown live on our new network near Darwin in a helicopter flying at 100 knots per hour. There is no sound to this, but we are testing and have been testing this network about as rigorously and completely as we could. So you saw there, 100 knots per hour up in the air, this network was working at these high bit rates of delivered content.

So, I would like to say to all of you: welcome to the new world of Next G. If you visited the Telstra Shop on your way in you may have downloaded a piece of music to a mobile phone and to a laptop at the same time. The nice thing about that is that you pay once. The nice thing about that is you can only do that with Telstra. But when you pay that one time you essentially get two licences as the music is sent to both devices. Again, only Telstra makes that possible.

Remember with our nationwide coverage, 98 per cent of all Australians can now experience music downloads that are fast and easy. Again, you will have a chance to see how fast and how easy it is.

Next G is not just about handsets. I want to be clear. In the past we have always looked at the front of these devices and they have a name. The name of that device kind of defined what the experience was going to be for you and 400 million other people around the world. That now changes, because when you open any device from Telstra now you are going to be able to get a Telstra experience that you can customise for you and personalise for you; not for you and 400 million others, but for you. That, to me, is a big deal and it is a big deal as we have researched these kinds of concepts with our customers. So it isn't just about handsets. Next G broadband also does work on your laptop.

So when you think about inserting one of these cards, we now call this our "turbo card." because it does change the game for our customers of taking their laptop wherever they want to go, inserting the card and having this high-speed broadband capability wherever they might be.

So the world of business opens up further across Australia. It is accessible. This broadband capability is accessible everywhere that you may need it. It means you can be at a meeting with a customer, and if you need to download some important data you simply plug in your Next G turbo card into the laptop.

Telstra has taken video calling to a whole new dimension. Mobile videoconferences are now possible from wherever your employees, suppliers or customers are. For businesses with regional operations or a highly mobile work force, that means face-to-face meetings. So it is no longer you can't see the person, you can't look in their eyes. It is all there for you to be able to do.

So I would like for you to take a look now. We are on a live videoconference with colleagues across Australia. So what I would like to do is have you all say hello to Shontell on Thursday Island. Shontell, do you want to wave at us?

SHONTELL: Hello.

SOL TRUJILLO: Hello, Shontell. How about Daryl in Cape Byron? Daryl, do you want to say hello?

DARYL: Good morning, Sol, and welcome to beautiful Byron Bay. It is a glorious 22 degrees here. Congratulations on the new network. It is absolutely fantastic.

SOL TRUJILLO: All right. Thank you. How about Andrew in Southport?

Sol Trujillo

ANDREW: Hi, it is Andrew in Southport. We're actually at the Ida Bay Railway, Blue River. We are about an hour and a half south of Hobart on the very pointy end of Tasmania, which is obviously at the very southern point of Australia. Thanks, Sol.

SOL TRUJILLO: All right. Good morning. And Ron in Uluru?

RON: Yes, thank you, Sol. Absolutely beautiful here today. I will just turn around and show you the iconic view that we have from here. I hope you can see the landscape. It is absolutely magnificent out here.

SOL TRUJILLO: Ron, we can see the landscape.

RON: I would like to tell you how fantastic this network is. On the drive out here I stopped at a place called Eridunda, which is about 200 kms south of Alice Springs, and I could watch FoxSports. I just love it. Thank you.

SOL TRUJILLO: All right, Ron. Thank you all. We are here in a big meeting with a lot of folks that are interested in hearing about what you and others around our Telstra family have been doing. So thank you very much for taking time out of your busy schedules and we will talk to you down the road. Thank you. Bye-bye.

As you can see, these are only the beginning of the ways that Telstra's new network is about to change life and work in Australia forever. Now thanks to Telstra, Australians across the country are about to have more ways to do more thing in more places again than we have ever had the opportunity to do.

Remember at the beginning I mentioned challenging the paradigm of more technology has traditionally meant just more complexity for the customer. Take a look at this. Only Telstra again puts the things you want most just one touch away on the "my place" menu. You can see it up there on the screen. I can show it to you right here. When you flip open your phone and you click once, you are there. No other phones in the world feature this one touch menu, and only Telstra makes Foxtel TV, BigPond, Where Is, your account information, e-mail and more so easy to get to. Click and you are there.

What's the next generation of these next generation phones only from Telstra? Well, it is going to include menus that you can customise even further. This is simplicity in that it is built so that you can drive what it is that you like to do, but most importantly anywhere that you might be.

I want to take a moment and give credit to our partner who helped us build this network, a partner who is providing the most advanced technology across the globe. I have asked Carl-Henric Syanberg, chief executive officer of Ericsson, to join me for this historic occasion. So, Carl, would you please come up.

Carl, if you wouldn't mind just sharing with everybody some of your perspective about the industry, about the technology, and about what we're doing here.

CARL-HENRIC SVANBERG: Absolutely, Sol. And let me say to you and, ladies and gentlemen, it is wonderful to be here. I've travelled ten thousand miles to be here at this special occasion -- historic moment for Telstra, for Ericsson, and for Australia.

And let me say that we have the world's eyes on us today. This is the way the industry and the technology is moving, and I want to congratulate you, Sol, and your team for being early with your decision in leading the world in that respect. What you are delivering today in Telstra is raising the bar, raising the bar for operators around the world as they respond to consumer expectations.

We need to understand that designing, planning, and roll out a network and lower services, that is something that does take time and that is why it's so important for an operator to be early out with his strategic choices to make sure that one can stay ahead of consumer demand.

Telstra will be able to offer services demanded by users today and tomorrow, and I must say that I'm proud and I'm excited to be a partner and to be part of launching this new generation network. In addition, to be able to launch a network of this kind on 850 megahertz. That is an advantage especially when it comes to reaching out and creating coverage. That is so important in a country like Australia. But it also joins in with other large roll-out that is presently going on with Cingular in United States, with Rogers in Canada, which means that it will help also to drive technology and availability of handsets.

Telstra and Ericsson, we go way back together. Ever since 1890, we have been building Australia's communication infrastructure. But I must say that never has a project been as demanding as this one with the requirements and the targets set out by Sol and his team.

Together we have built this national network in a record time. In just ten months we have been able to cover 98 per cent of Australia's It represents the largest -- the geographically largest population. network -- 3GSM network in the world, and we will also very soon be able to actually reach 200 kilometres from a single radio base station which is a feature that is especially important for a country like Australia with its specific rural coverage needs.

And I would say that that is just one of many small examples of our

partnership but also of the commitment from Ericsson to continue to lead is leading world standards in mobile technology. We are every year investing some five billion Australia dollars in research and development with 18,000 search and development engineers.

Our industry is changing rapidly and will do so even faster in the future. We have seen now traditional wire line telephony for 130 years. We've had mobile telephony for some 50 years and with a leading standard GSM for now some 25 years. But today the phone as we all know it offers so much more than simply voice. In fact, this phone -- we can look at just this simple standard mobile phone -- it actually has more computer brains than Apollo 11 had when it landed on the moon. And it is pretty fantastic and breathtaking to think that I hold more computer power in my hand than Neil Armstrong when he commanded his moon landing.

What was then enormously expensive has now become affordable to all of us -- to many of us -- and it is, of course, the large volumes that makes this very exclusive and advanced technology available to so many.

Last year there was 800 million phones sold in the world and that makes it the most sold consumer product in the world, and it is one of those devices or products in the world that have meant most to change and develop peoples' lives. And, of course, today we do so much more than just talk. It is, for example, possible to download music, listen to music whenever we like to do so. Let me just show you with this phone. Let's
listen to some music here. (Music) Pretty fascinating with a little phone like this that it actually is possible to drive this whole here. It's amazing.

With today's technology, data speeds are being dramatically increased. This will, of course, it will pave the way for many more new services such as mobile office applications, such as music downloads, mobile TV, and any other multimedia applications. And as a result, the traffic in mobile networks is expected to quadruple in the next five years, and we expect also that by 2010 that data traffic will exceed voice traffic.

The GSM wideband CDMA technology that Telstra have chosen and which is also quickly growing in importance and it covers today 2 billion of the 2.5 billion mobile users in the world. That, of course, means that it offers scale, it offers efficiency, and also an evolution path to the future. It is the 3G technology and standard in the world that is growing the fastest, and we can today offer data speeds that we get or exceed the data speeds that we get in fixed broadband connections and networks.

We're no longer measuring speeds in kilobits per second but actually in megabits per second. And through HSDPA we can provide true mobile broadband and provide an opportunity for billions of people to reach the Internet.

Mobile broadband is changing the industry just like once mobile telephony did. And I'm sure that several of you remember and we asked ourselves some 15-20 years ago, "Who needs a mobile phone?" Today we are seeing the same shift again when it comes to mobile broadband. We as end-users we have broadband connections. We want to have a broadband connection for wherever we are and for any device and for any type of services.

But broadband access over networks is expanding also the overall market. Today about a billion people have access to the Internet but only 300 million through broadband. Just imagine when two billion people can get the access to mobile -- true mobile broadband, and these people are today simply an upgrade-step away from mobile broadband.

We can use it for many other things. I would like to show you -- and I have Malcolm up there. Malcolm has one of these chip sets that Sol showed you. This is -- I'm very sad to look at these pictures, in fact, because I asked Malcolm to download over the Internet -- I think vou can cut it off. It is a bad thing because this is my home team -- the leading hockey team in Sweden playing the worst team in the league and the home game two nights ago -- and they lost the game. That is what makes it so sad. But you must agree with me that this is pretty fascinating. This is the picture blown up here. Just imagine how sharp it is on your laptop which means that you're not any longer -- you don't have to sort of wait for a moment when you can watch a TV program at 8 on Friday night. I think we will see a lot of TV whenever we want on demand in the networks.

Half of the world's population will soon have a mobile phone, and this is a fantastic development, and I'm sure that very few could anticipate when GSM started to really grow some 15 years ago. We at Ericsson, we have a vision of an all-communicating world. Communication is not only a fundamental human need. It also brings us closer together. It helps to build a democratic society, and it is driving economic growth.

I am proud over what we have achieved together with Telstra. I am proud that we at Ericsson can be part of this new era in Australia of communications. It is truly an exciting project to be involved in, and I can only give my compliments to Sol, Telstra, and the team for being the first in the world to drive this technology and development further and take this important infrastructure step.

And I can tell you that there are many, many customers around the world that are watching us now and they are eager to see how the development proceeds. Once again, Sol, thanks for letting me be here.

SOL TRUJILLO: All right, Carl. Thank you very much. It's great to have you here.

CARL-HENRIC SVANBERG: Thanks.

SOL TRUJILLO: Now, just so everybody knows, Carl and I basically for the last ten months have had weekly conversations, right, Carl.

CARL-HENRIC SVANBERG: Yes.

SOL TRUJILLO: You know, getting this done in record time has been,

you know, a challenge for both of us. So do you want to comment in terms of your experience with this versus maybe some of the other opportunities you've had around the world.

CARL-HENRIC SVANBERG: Well, I can certainly tell you that there hasn't been a project that we have been involved in ever in Ericsson that has been this demanding and this fast. We have, in fact, in the most critical weeks and months here we rolled out and launched a new radio base station every 25 minutes, 24 by 7. That's incredible and it takes an enormous effort. But, of course, it does take a partnership as well. You cannot do it as a vendor alone or as a telecom provider alone. It has to be together and I must say that our weekly calls Monday mornings at 8:30, they've been at times very joyful; at times very frustrating. It's been a nervous race all the way but we're here now.

SOL TRUJILLO: Yeah. Well, I think one of the things that we learned and is very important is this notion of trust because when you make commitments -- in our case, we're committing to you as a customer but also then as the strategic supplier -- that we have to trust each other in terms of our capabilities but also the candour.

CARL-HENRIC SVANBERG: Yes.

SOL TRUJILLO: I mean, we've had some very candid conversations with each other during that process. But the point is to get things done.

CARL-HENRIC SVANBERG: Yes.

SOL TRUJILLO: And I think we've accomplished something nobody has done ever in the world before in terms of this kind of deployment. Just one other thing that I think would be helpful if maybe we can do is we have one of our technology folks over here that's going to help us show everybody here what this really is about. Mick Alford is sitting over here and, Mick, why don't you show us --

MICK ALFORD: Sure.

SOL TRUJILLO: -- the differences here and explain to us what you're going to demonstrate up here.

MICK ALFORD: All right, Sol. Good morning, ladies and gentlemen. Okay, what we have here is four identical laptops all set up, all plugged in with various wireless cards in production as you would if you stepped outside now and just logged onto the Internet.

We've got here on the far right is one of the competitors -- is our competitor's 3G offering. Next to that is Telstra's initial 3G offering on a laptop. Next to that we've got Telstra's EVDO and at the very end we've got Telstra's NEXT G turbo card. What I'm going to do is I'm just going to kick off a quick download, and what you can see if you have a look at the screen here, the screen has got Telestra's NEXT G turbo card on it. The feature to look at is the red bars there. That tells you how fast the download is coming, peaking about 3 meg, averaging about 2.6 however

it's showing there. We might as well just have a quick look at the competitor's card, see how that's going. It sort of hasn't even woken up yet, just having a bit of a think about things, not even having breakfast.

Telstra's initial 3G one is still going here. Sorry, mate, it's all done. Our turbo card 8.9 megafile in 30 seconds. There you go, Sol, all done.

SOL TRUJILLO: All right, Mick. Again, you know, part of the reason why I wanted all of you to see this is what we're about to deliver to all of Australia is the equivalent on the wireless base as to what we all experienced in the fixed line when we moved from narrowband to broadband. The narrowband you remember the wait. We had this www world wide wait kind of phrase that we all used. Now, it's almost disappeared from our discussions.

Now, with this NEXT G capability it's almost instant in terms of the wireless experience, and the speeds at which things can be delivered are so significant. So we're anxious to turn this network on but as we do that, I think it's important for me, Carl, to make sure that we're ready in our stores.

So what I'd like to do is just check with Debbie Easter who is at our Telstra shop in Albury, get her online, and make sure that we're ready. Debbie, are we ready? Hello, Debbie? Can you hear me?

DEBBIE EASTER: Hello. Yes, I can hear you.

SOL TRUJILLO: Okay. Go ahead, Debbie.

DEBBIE EASTER: The team's really excited about the NEXT G products that we have and are looking forward to showing all of our customers the benefits they're going to have by using the new network that we've now got enabled for our customers.

SOL TRUJILLO: Great. Great. Well, I was at a dealer conference earlier this week and the feedback was tremendous in terms of what all of the people were telling me about the next set of capabilities that they can now offer to their customers as they have their stores, but obviously we're going to be launching first here in our Telstra shops and it's good to hear that you're ready.

So, Carl-Henric, what I want to do is now get us ready to turn the network on.

CARL-HENRIC SVANBERG: Right.

SOL TRUJILLO: But I think before we do, we need to say thank you to the people. You and I are standing here on the stage but there are some people that really made this happen every day.

CARL-HENRIC SVANBERG: Let me first say, Sol, I would like to express a thanks to our staff. It is, of course, wonderful to be here. I've been a supporter all through but true heroes are out there in the field.

Fourteen hundred people we have had rolling out this network with us and partners, and there are some who have really done tremendous efforts.

I would like just to ask Bill to stand up and also Hals Vesberg from They are the ones that are responsible throughout this. Sweden. Throughout the world Hals and Bill are ahead here in Australia for doing this. This is just fantastic but -- you may sit down.

But as I said the true heroes are out there battling still but I would also like to say that without you, Sol, and the team this wouldn't have been possible, so we're extremely grateful for this opportunity.

SOL TRUJILLO: Thank you. Well, Carl-Henric, I think you've gotten to know our leadership team here as well and I'd like to first acknowledge our Chief Operations Officer, Greg Winn. Now, Greg, if you would stand up if you can. You know, I think most of you know that since I came here I've been working on building a world-class team and Greg is world class.

I think if you talked to almost anybody inside our company that's worked with him or if you talk to the folks that work with him outside the company, he truly is world-class. He's driven this whole set of operations and the whole set of activities in ways that Carl-Henric and I were talking about that we've not seen before. And Greg has done a special job as leader in the business that's running the operations and making it happen. So please help me thank Greg Winn.

With Greg are also two other individuals. One in particular that I'm going to start with and his name is John Gonner. John, if you would stand up. John also joined us. He's had experience operating around
the world as well in terms of building networks in Eastern Europe,
Vietnam, the U.S., Europe, all kinds of places, and John is the person that we gave the task specifically around wireless to help us with our strategy development, to help us in terms of thinking about what was the best set of choices, and obviously, John, he's always done a terrific job for us. But, John, I want to thank you very much for everything that you've done to make this work.

And then finally Mike Wright. He's one of what I would call one of our "home boys". He's an Australian. He has a long history here with Telstra. And Mike has been the chief engineer, the wireless engineer driving the design, the architecting, all the things that are associated with again making this the best network possible for Australia. So, Mike, I want to say thank you to you as well, and congratulations to all of you.

So, Carl-Henric, I think it's time --

CARL-HENRIC SVANBERG: It is time.

SOL TRUJILLO: -- to light up the network.

CARL-HENRIC SVANBERG: Yes.

SOL TRUJILLO: So let's go.

Okay. Well, congratulations.

CARL-HENRIC SVANBERG: Thank you.

SOL TRUJILLO: Thank you very much.

ANDREW MAIDEN: Ladies and gentlemen, my name is Andrew Maiden. Welcome to those watching on our webcast. We now have a short opportunity to take some questions from the media and after that we'll have a 15-minute break and resume with the analyst component of this event today.

For media, can I ask that when you ask questions please introduce yourself by name and organization and make clear to whom it is that you're question is addressed. So are there any media questions? Please come to a microphone.

KATHY SWAN: Hi, Kathy Swan from ABC TV Inside Business. You've said a lot about how we'll be leading the world with the pace of the mobile broadband, but it's still not going to match fibre to the node. When are we going to catch up there.

SOL TRUJILLO: Well, we'll talk about fibre to the node later today in our investor briefing, so I'll deal with that then. Okay? Thank you.

ANDREW MAIDEN: Microphone three.

MICHAEL SAINSBURY: Hi. Michael Sainsbury from The Australian. How are you?

CARL-HENRIC SVANBERG: Hello there.

MICHAEL SAINSBURY: With this HSDPA technology that you've got on the new network, is that any different to the technology that Vodafone launched this week or that Hutchison will be putting into their network or Optus?

CARL-HENRIC SVANBERG: What the HSDPA network actually is doing it is using normal 3G technology which has a radiowave that basically swings up and down. But data -- when you're up on the top, you're up at 40 megabits per second and down here you're very slow, but the voice has to come through that whole way. But data you can basically use and jump on the tops and stay on highspeeds.

We are here the first in the world now to launch 3.6 megabits per second and then we will step it up to 7.2 and then 14.4 and that we'll go step by step. So in that sense we're the first here. But it's basically the same infrastructure and the same technology. That is very important because you want a future-proof technology you can migrate step by step into higher, better technologies.

ANDREW MAIDEN: Any other questions? If not, there will be another opportunity for media questions at the end of day. But I see another at microphone 3.

TONY BOYD: Tony Boyd, Financial Review. I wonder if you could just talk about the handsets that will be available; for example, Nokia, which I think is 60 per cent of all phones sold in Australia. When will you have those, Sol?

SOL TRUJILLO: Well, first of all, Nokia is not 60 per cent of all phones sold in Australia. As a matter of fact, I think David Moffatt will talk a little bit later about the mix of handsets. We will have Samsung. We will have LG. We will have a ZTE which is a new entrant in the market. We're going to have a Jazz Jar PDA handset, and we have a whole series of handsets that will be evolving over the next few months including Motorola in a couple of weeks as part of our lineup.

We have a great offer but as I said before, the issue here is not about the name on the front; the issue here and the opportunity here for customers is about the name on the inside, and it's about Telstra and it's about the experience that we're going to deliver. As certain manufacturers are ahead of others in terms of moving into the 3.6 As certain HSDPA kind of world including 850, they will all come and they will all be part of the game.

But again the most important name with what we're doing with NEXT G is Telstra. That is the brand; that is the service, and that is the experience.

ANDREW MAIDEN: Raphael.

RAPHAEL MINDER: Yeah, hi. I am Raphael Minder, correspondent for the Financial Times. I wanted to know -- if I understand right you're actually launching today the marketing side as well -- what kind of offer, what kind of promotion are you giving customers to get them to migrate to this network? Are you going for something very different to what you had done in the past with previous new products?

SOL TRUJILLO: Well, actually, Raphael, the number one offer that we've got for our customers is the experience. It's about the speed. It's about the reach. It's about the capabilities. It's about all the things now that they're going to be able to do that they could not do yesterday or that they cannot do with another competitor.

Because this in-building coverage issue is a big issue for most customers. We've taken that wall down. In terms of the nationwide footprint not only for voice but also all the data services and capabilities is the new opportunity and also then some of the applications and services that we talk about in terms of our devices. When you go on and you want content, you want music, you want to download, you want to do things simply, easily, that's all part of the offer that's different and bigger and better than ever before.

ANDREW MAIDEN: Microphone one.

KAREN TSO: Karen Tso, Channel 9. Question for Sol: Obviously the timing of this network launch comes before the T3 shares go on sale. How is it likely to impact that sale process?

SOL TRUJILLO: I really have no idea how it will affect the sale process. We designed this date over a year ago. Over a year ago. It had nothing do with T3. It has everything to do with serving our customers and being better than those that we compete with.

So in terms of commenting on T3, it really has no relevance in a sense of timing, capabilities, and the differentiation that we have. What I talked about last November 15th was that by no later than the 1st of '07, we would build this high-speed data network broadband wireless capability that would advantage us in the market place and that's what we've done.

ANDREW MAIDEN: Two more questions. The second last from microphone 3.

JENNIFER HEWITT: Jennifer Hewitt from the Financial Review. I was just wondering if you could give us any indication, Sol, of the type of pricing you're looking at on this also how many people you expect to have on the network by the end of this year, and if you see any issues at all of congestion if, in fact, this proves to be extremely popular.

SOL TRUJILLO: Jennifer, let me take the last part of your question first and then I'm going to beg off on the first part because David Moffatt will talk about some of this in his presentation a little bit later in some good detail around our whole strategy of roll-out. In terms of the congestion, this network is being built for a lot of customers in terms of the network capacity, probably initially up to a million and a half customers just as of today. And I'm looking at Greg and John and Mike for verification as our engineers.

So we have plenty of capacity and plenty of reach again around the country. We don't put our little toe in the water and just announce one little exchange or one little city or one little whatever. We're doing this nationwide. Now, the key here relative to the services and the offering and the pricing, again this is a high-value network. This is going to be enabling lots of capabilities that people have never had before. And so David will talk some more and again I think you'll get the precision of what you're looking for in a little bit. Okay? Thank you.

ANDREW MAIDEN: And the last question from microphone one.

JOHN FARDOULIS: John Fardoulis from Mobility Magazine. I'm just trying to get a handle on the significance across the whole industry. So if I ask you a question and a quote at the end -- if I asked you: This is the biggest thing in mobile since... What would you say?

SOL TRUJILLO: Well, to me this is the equivalent of the transition we made in fixed line from narrowband to broadband when you think about

the world wide wait versus the always-on experience. Because now when you click and you access a service here, it really does come right away. And in this case if I want to get on to my BigPond site, it's instant. It's three, four seconds in terms of the time that it takes to get there.

If I want to watch FOXTEL, it's three or four seconds to get to that site. It's not like anything else because most of us -- pick up any mobile phone that you have today including Telstra's, so I'm not just talking about inferior competitor A, B, or C. I'm including Telstra in that statement -- you click on any kind of site that you want to access, you see the little globe turn, and you wait and then you wait and then you wait and then you finally get something show up. And then when you're on there you click again waiting for it to get to another site and you wait.
Now you click and you receive. That is the big difference.

JOHN FARDOULIS: How about an Ericsson comment as well. The biggest thing in mobile since what?

CARL-HENRIC SVANBERG: No. but I think you're absolutely right there. Sol. And we've always been enthusiastic about taking steps when it comes to speeds. This time it's a big step but it also is a break -- we pass a breakpoint. You can now download with your card that we pass a bicakpoint. Tou can how download with your card that we
showed on the -- like, for example, the hockey game there. You can
download now as quickly your mailbox as you ever do at home. You can
download music as quick

This means that in Sweden where we have 1.8 megabits per second, those guys now that have started in our offices, we're are all running around with our 1.8 cards and people don't hook up to the broadband anymore because it's good enough. It's as good as the fixed broadband is. You can download music and actually keep it there as well as you do it in your iPod. So you're actually passing a breakpoint. It's pretty fascinating.

ANDREW MAIDEN: Ladies and gentlemen, thank you for your questions. We're going to resume the analyst briefing component of today at 9:55. So please be in your seats at 9:55. And for television cameras and print photographers, we'll have another opportunity for photos on stage now. So we'll speak again at 9:55.

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