Telstra CEO Details Australia's 'Next G' Network

What, if anything, did Sol Trujillo learn from heading two major telecommunications companies, US West and France Telecom's Orange?

Answer: He learned how to build a huge, very-high-speed wireless network, the largest of its kind, and he learned how to build it fast. It's Australia's Telstra Next G network and it covers a land mass the size of Western Europe. Trujillo oversaw the construction of the network during the single year it took to build it.

In an interview this week, Trujillo discussed the initial anxiety he faced when he became CEO of Telstra more than three years ago. The government-operated telecommunications company was in the midst of a privatization campaign and needed to build out its different units. A new wireless unit was particularly needed.

"People thought I was nuts," Trujillo said of his ambitious plan to build out the wireless network in a single year when most networks take four of five years to build. "Nobody's ever done a network in a year. We knew it was risky. But the company was losing market share."

Trujillo rejected a WiMax solution ("still pretty nascent") in favor of using spectrum in the 850-MHz band, because that spectrum has up to four times the range of WiMax and has superior in-building penetration. In a way, Trujillo's decision to avoid WiMax was indirectly endorsed earlier this year when Buzz Broadband, a major Australian attempt to use WiMax, was abandoned earlier this year.

"We broke all the rules" while building Next G, said Trujillo. "We leveraged old existing sites and built new sites. We had people working around the clock." Engineers who finished a shift at 5 p.m., for instance, were relieved immediately by night-shift engineers, who kept right on working. In the end, the entire network was turned on in a single day.

Next G, which is Telstra's label for 3G, covers 99% of Australia's population and delivers downlink rates at 14.4 Mbps, although the entire network is being upgraded now to 21 Mbps. Trujillo expects the network will deliver speeds of 42 Mbps around the end of 2009.

Next G is based on HSPA technology, similar to the technology utilized by AT&T in the United States on its 850-MHz network. As a former chairman of US West and later chairman of Orange in Europe, Trujillo has a unique perspective on the world's wireless networks, including their failures and successes.

What about Long Term Evolution? Trujillo said the Next G network will switch over to LTE in a few years if it makes sense. Before that, Next G should reach speeds of 100 Mbps, so Telstra won't need LTE for a long time. What can you do with such high speeds? Trujillo notes that Next G has already opened up some interesting applications because of its robustness, and he expects users to dream up more as more experience is gained with the network. Observing that the high speeds improve imaging and video applications in particular, he pointed to a medical imaging application -- scanning for breast cancer -- that is under way in Victoria State, the country's most urban region.

"Mobile vans [are available] for breast scans," he said. "In the past in took four to five days. Now with Next G, it's a four- to five-minute process." Trujillo believes very-high-speed mobile networks will lend themselves to more and more medical applications.

He also cites an education application that can be a forerunner of additional educational applications. A brace of cameras -- some underwater -- have been deployed around Australia's Great Barrier Reef, giving many disadvantaged children their first opportunity to experience and see the reef in a close-up, real-time manner. It's what Trujillo calls "a shared educational experience," available only because the network's high speed makes the imaging possible.

Next G has some innate advantages over most global wireless networks that have seen their various components separated from each other. For instance, rather than selling off yellow pages business directories, Telstra has kept them to beef up a variety of content features for users. Its BigPond offering delivers news, and its Foxtel operation delivers a variety of video offerings. "Nobody has ever built a complete media company," Trujillo noted. "But we're putting it all together."

Microsoft has taken notice, too. Chief executive Steve Ballmer visited Australia last month, and the software company will develop applications -- much of it based on Windows Mobile 6.1 and higher -- for use with Next G. Trujillo said Microsoft's involvement follows his general business philosophy of "adding value" because of Microsoft's "almost universal" position on the desktop. "It's a way of keeping it simple," said Trujillo.

For now, though, many subscribers are kept from using the high speeds of Next G because handsets aren't available. However, a new generation of handsets is slated to debut next year to take advantage of the 21-Mbps speeds.

For additional thoughts on why WiMax lost out on Telstra's Next G plans, InformationWeek has published an independent analysis of the wireless technology sector. Download the report here (registration required).