Interview: Sol Trujillo of Telstra

Published on:

It's half-way through Sol Trujillo's five-year transformation programme at Telstra, but now he's looking 10 or 15 years ahead. He tells Alan Burkitt-Gray about the future of wireless and the coming renaissance for fixed line

Trujillo on TV

Trujillo on TV: Sol Trujillo interviewed on TV by GTB editor Alan Burkitt-Gray. Watch the interview on

The big-bang switch-on of Telstra's award-winning 3G network, called Next G, was probably the last sudden technological changeover the company will make. In future, says CEO Sol Trujillo, it will be continuous, unstopping change.
He's already half-way through the initial five-year transformation programme, which has seen the implementation of Next G, as Telstra calls its 3G network, and the development of an IP-based fixed network. Now he's looking 10 to 15 years beyond the end of those five years.
And there will be a continuous evolution from 3G through to 3.5G to 4G, he says. No more big bangs — but a remarkable improvement in service.
The groundwork has already been done, says Trujillo. "The real purpose of the five-year transformation was to enable the 10-15-year strategy to be played out. We've changed the game with our Next G network. We don't call it 3G, we call it Next G." That is intended to imply that it will move almost seamlessly through 3.5G to 4G. "The infrastructure choices, the spectrum choices, the technology choices, the supplier choices were all taken with that in mind."

Innovation award

At the same time — see — there's the news that Telstra and its equipment supplier, Ericsson, won one of this year's GTB Innovation Awards for the Next G project. If Telstra really is committed to Ericsson through all this continuous upgrading that Trujillo is promising, there will be celebrations in Stockholm.
So, to confirm, the Next G choices were made to take Telstra through to the LTE world? "Correct. And the reason is that I've been around too long to believe that something is just going to happen overnight."
Look at WiMax, he says. "People have been talking about it for three years. Has it happened? The answer is no." Why? "Because it takes time to build out an ecosystem. We learned that with 3G. We talked about 3G before 3G became real."
At Telstra, "we already have the world's fastest, biggest network", he says. "It covers two million square kilometres and it is running at 14.4 megabits a second peak speed. That's the network: we're going to be taking it to 21 megabits a second by the end of this year."
And by the end of 2009 "we'll be taking it to 42 megabits a second", he adds. "We're going to keep that ball going forward, and that momentum going forward, as we move towards 4G — what people call 4G, or LTE, whatever the acronym is."
LTE is the abbreviation preferred by the GSM industry for the "long-term evolution" towards what might otherwise be regarded as 4G — a term many in the industry have been wary of using, for fear of inciting politicians to look for more licence fees.
LTE or 4G means "super high-speeds", he says. "In the mean time we can serve our customer with great speeds, with great applications, and move them towards that as opposed to pretending that we're going to go from low speeds to mega-speeds overnight."

Evolutionary process

It will be, he says, "a very high speed evolutionary process, because I believe in taking customers with us as opposed to hoping that they will be there when we get there". So the Next G network has been built with this evolutionary capability, he says: "and we're going to turbo-charge it".
But does that 42 megabit speed remove the need for optical fibre into people's homes or offices?
"I believe we have two phenomena happening simultaneously," he says. "One is that all of us love being untethered. We love being wireless. If I can make it real time, that's all the better. When you get to 14.4 megabits, 21, 42, you can be real time. You push the button and, guess what, stuff happens."
But does that mean that people no longer need broadband in their home or business? "Absolutely not, and here's why: at the same time we're all becoming very attached to the next wave of high definition, high resolution, 3D, haptics, holography — all these things that are now starting to emerge."
That means "we're about to see the renaissance of the fixed-line business", says Trujillo. He sometimes jokes, he says, that the US is the Third World in terms of wireless services — and he's American, and a former CEO of a big US telco, so he can say that.

Bandwidth for 3D

"But at the same time it's the first world of fixed line." The penetration rates for high-definition services show that higher bandwidths will be essential. A couple of HDTV channels, another being recorded, and some high-speed internet, and then add 3D. It's coming from studios such as Dreamworks. The result will be that "you'll need more bandwidth".
And in the business world, Cisco's TelePresence and similar high-definition systems from HP and Polycom, show that higher bandwidths will become essential. "You will need 40-45 megabits for TelePresence, but it gives you that richness of interaction."
Taken together, there will be "an enhanced social experience" in entertainment, in business "and the way we socially interact", he explains. "That all requires bandwidth."
And then families will drive bandwidth still further. He reminisces about "the old days" when a family would share three or six megabits — though that's still a dream for some — will not last much longer.
"Simultaneous use in the home, just like in a business, requires more bandwidth. I believe the renaissance of the fixed line is coming."
So how is the Next G network performing? Trujillo, understandably, is an enthusiast. After it had been switched on and was running successfully the company closed down its old CDMA mobile network — overnight, though a couple of months later than it originally planned. Rural politicians had lobbied hard to keep to on.
"Most of our customers had already been switched over, and the last few were phones that people had in drawers, for security," says Trujillo. But the changeover "went very well".
Was there anybody who couldn't get 3G, who had been able to rely on CDMA? "No, he says. "Next G provides more coverage than CDMA, and it provides more services. CDMA was basically — and I say basically — a voice service. Now you can take data, you can get on the internet, you can do all kinds of things that you couldn't do with the old CDMA network. And it runs at high speed."
Next G uses the 850 megahertz spectrum, much lower than the frequency bands normally used for 3G, and that gives it much wider coverage.
"The 850 spectrum has been great, because you can have fewer cellsites than with 2100 or 1900, the other spectrum bands, and the propagation characteristics are just better."

Nationwide coverage

Are there lessons for other operators in how Telstra managed that transformation, by turning on Next G quickly, to provide nationwide coverage, and then — not long after — turning off the CDMA network equally quickly?
"I guess the lessons learned are to make bets. You have to take some risks and you have to be decisive about it. And you have to put full effort on doing it, because not only are there technology choices, not only are there investment choices, not only are there product and services choices, but there are the whole customer experience and the politics of changeover."
When analogue converted to digital, "that was a big emotional moment and political moment in many countries around the world". How it was done then was often politicised, he says. "Some went well and some didn't go so well. Planning the details, the execution is always important. The good news is that feedback always helps."
Telstra was glad to get feedback about handsets, "that some worked better than others and we put in place a blue-chip certification programme so that if you are really out in faraway places, here are the handsets that work better".
Telstra told "every manufacturer what the specs were" and "they could work to them, or not". Telstra sells standard certified handsets, "but you have to take it one step further when you're serving people in remote locations".
And you have to learn to live with those rural politicians, too. GTB