KEY POINTS:
The new boss of Telecom's Australian business is using his first weeks in the job to go eyeball-to-eyeball with his staff, inviting them to ask any question they like as long as they're prepared to accept his answer.
Paul Broad took over leadership at AAPT, Telecom's poorly performing
retail business, after Telecom's acquisition of PowerTel, the company he leads.
Telecom bought the listed network infrastructure company last month for $404 million.
Before acquiring PowerTel, Telecom had tried to sell its struggling Australian retail arm AAPT. The company bought AAPT for $2.2 billion in 1999 but after a series of writedowns, values it at just $270 million.
Broad said he's "not a back-room bloke" so is getting out for honest "fireside chats" at all the company's offices. "I'm actually physically meeting people - I want everyone to see the whites of my eyes."
The talks focus on getting AAPT's customers on to PowerTel's network, rather than relying on the thin margins offered by using Telstra's network, and keeping them there. He says AAPT is "churning" 4 per cent of its customers every month.
"We've got these customers coming in the front door and you're churning them out the back door."
Broad calls it a "back-to-basics" approach - something Telecom chief executive Theresa Gattung promised shareholders in 2003 when AAPT was losing up to 28,000 customers a month.
Now the company will have greater access to PowerTel's networks which, when an exclusive access deal with iiNet is included, cover 92 per cent of the Sydney market, 94 per cent of Perth, and 70 per cent of Brisbane and Melbourne.
Broad said the results will come from offering customers a better experience and keeping them on-net.
"We want the Telecom shareholders to think their Australian investment is finally going to pay them a return for all their hard-earned dollars that have been spent here."
Broad believes that in time only three telcos will be left in Australia - the incumbent Telstra, SingTel-backed Optus and AAPT.
"I think it's a real opportunity for us because Telstra is misbehaving still, Optus is struggling to define itself in the market, so we, at our 4 per cent, can grow that to 6 per cent, 8 per cent profitably."
Broad began his career as a "humble old economist" in the Federal Treasury in Canberra but moved into the utilities sector in the early 1980s, taking a job as the economist for the Hunter District Water Board. Seven years later he was running the business.
Since then Broad has managed the Sydney Water Corporation and electricity utility EnergyAustralia.
While at EnergyAustralia he began thinking about offering telecommunication companies access to major buildings via the existing electricity ducts and network access points.
PowerTel was born out of this idea, originally owned by a consortium of energy utilities and US-based telecommunications giant Williams.
But the failure to meet customer targets, the end of the dotcom boom and majority owner Williams in financial trouble saw PowerTel up for sale.
"I did believe in PowerTel and I still do today believe what we created here was the right thing to create. It had just been poorly managed."
