The Deloitte Telco Index (PDF) analyses the movement of share prices of telecommunications industries around the globe, and reported that Telstra's relative share of the telco market capitalisation increased from four percent in 2000 to six percent in 2003. This brought it to equal fourth largest telco in the region.
"Australia's Telstra was one of the best-performing companies in the region, in part because Telstra's share price did not get as caught up as its peers in the tech stock run-up of late 1999 and thus had less distance to fall," read the report. However, part of the success was attributed to Telstra's continuing dominance in the Australian market.
"In some cases, lower competitive pressures enabled incumbents and companies operating in more regulated countries, such as Telstra in Australia, to preserve margins," the report stated.
Despite efforts by the federal government to deregulate the Australian telecommunications industry, Deloitte reports that Telstra preserved its domestic market share at approximately 60 percent. In March, SingTel Optus claimed past regulatory systems were still keeping prices high for consumers. A month later the Australian Competition and Consumer Commission sought comment on whether it should regulate the Internet connections between ISPs in Australia. Carriers have already called for restraints on the ACCC's powers.
Deloitte reported that Telstra's goal to be the premier telco in Asia was being hamstrung by a softening of growth in the Australian mobile market, increasing domestic competition and unsuccessful investments in Asia.
"The challenge for Telstra is to further consolidate its position in the global telco sector while the Australian federal government remains in the background," read the report. Despite a bill allowing the sale of the remainder of the governments stake in the telco passing the lower house in August, it is doubtful whether the government will manage to muster the numbers to get the bill past the Senate.
"The sale has been delayed by poor market conditions and unsettled political issues, and it remains to be seen if the government will actually divest one of its remaining "jewels", said the report.
The Deloitte Telco Index also pointed out that companies with business models incorporating mobile and data components had fared relatively well on the stock exchange over the past three years, while companies that derive a high proportion of their revenue from traditional services have seen their market capitalisations decline faster than the regional average.
Telstra has a diverse revenue base, according to Deloitte, with no product or service accounting for more than 17 percent of total income. Its single-digit revenue growth (the Asia Pacific regional average was 15.3 percent compound annual revenue growth) was driven by strong growth in Telstra's mobile and directories businesses.
I wonder how much Teltra paid them??