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Telstra launches its new 3G network

"I'm very sorry but this is a load of rubbish, it's just another network -- nobody's going to use it for watching television services."

Paul Budde, media analyst

Australian telecoms giant Telstra yesterday launched a new 3G mobile broadband network as the firm moves to bolster investor confidence ahead of a troubled share sale.

The company's chief executive, Sol Trujillo, claimed the world's geographically largest national 3G network would offer wireless mobile and Internet access to 98 percent of the people of sparsely-populated Australia.

The "turbo-charged" service, which boasts a beefed up third generation (3G) mobile technology, was five times faster than any other network in the country and would offer its users 12 channels of television, sport and movie downloads.

"You see this is the day ... that life in Australia will be changed forever," said Trujillo of the network, put in place with an investment of A$1 billion (US$746 million) in little more than 10 months.

"This is an exciting day for all Australians, no matter where they live and work," he boasted.

"It is a versatile, high capacity network with headroom for higher speeds in the months and years ahead," said Trujillo, who is at the center of an increasingly bitter war of words over his management style with the Australian government, which holds a 51.8 percent stake in the telecoms firm.

Telstra customers will be able to download material at an average speed of 550 kilobytes to 1.5 megabytes per second (Mbps), with peak network speeds reaching up to 3.6Mbps, increasing to 14.4Mbps early next year.

Telstra's 3G customers, which currently number approximately 420,000 compared to rival Hutchinson's 1 million, will have to buy new handsets which it has been developing in conjunction with Samsung, Motorola, LG and Sony Ericsson.

"From today, almost every Australian is going to have access to nationwide, very high speed mobiles and Internet," Telstra group managing director consumer and small business David Moffatt said.

But the glitzy investor briefing strategy at which the plans for the network were unveiled was rudely interrupted when a fire sprinkler activated in the room, sending hundreds of analysts scrambling for cover.

As Telstra touted its new broadband mobile network, analysts also poured more cold water on the significance of the announcement, especially as Australia lags far behind in its fixed broadband infrastructure.

"I'm very sorry but this is a load of rubbish, it's just another network -- nobody's going to use it for watching television services," media analyst Paul Budde of the Web site Budd.com said.

While the technology is good, it is not what Australia really needs and it remains unclear whether the user rates would be affordable for a significant proportion of the population, according to Budde.

Also at the investors' conference on its five-year transformation program, which began nearly a year ago, Telstra forecast 1.5 to 2 percent revenue growth next year, with earnings before interest and tax to rise 2 percent to 4 percent.

The network launch came ahead of the government's unveiling on Monday of the prospectus for the sale of A$8 billion worth of stock, or one-third of its holding, in Telstra.
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