Telstra plays hand as technology champion

Telstra has long talked media ambitions but it’s no surprise it wants to sell down its stake in Foxtel.

Telstra has long talked media ambitions but rarely walked the walk in the game and expectations it plans to sell down its stake in Foxtel underlines this reality.

The phone behemoth plans to sell down its stake in Foxtel to concentrate on its technology ambitions.

Last night the company played down the news, saying Foxtel remained an important strategic asset for the company. The two companies have also increasingly become competitors with Foxtel now offering both broadband and home phone services in its so-called triple play offering, while Telstra has marketed its own video services.

This week it controversially hired former Nokia boss Stephen Elop in yet further evidence of its intent to push technology services as an adjunct to its carriageway services and its fixed-line offering through Asia.

As joint owners with News Corp, Telstra has sometimes clashed and the prospect of one majority owner would clearly make life easier for Peter Tonagh and his team at Foxtel.

News has always had the right to select the management while Telstra gets to chair the Foxtel board.

Earlier this week Telstra confirmed it had failed to reach a deal with San Miguel to build a third mobile phone network in The Philippines but it offered to continue the technical support it had offered.

This field is where Telstra boss Andy Penn sees his upside selling expertise in network application services.

Pay-television is a long way from this market and it makes sense for the company to cash in by selling some of its stake in Foxtel.

Its carriageway contract with Foxtel expires in 2020, which means the pay-television provider will no longer be a big money spinner for the company.

Now it just remains to be seen how Telstra will monetise its stake in Australia’s premier pay-television service.