The last two months have reinforced what an incredibly exciting time it is in the telecommunications industry.
In early September, Telstra hosted a meeting on the Gold Coast with representatives from the 3rd Generation Partnership Project (3GPP) to discuss the universal technical standards that will support 5G and the new world of technology and services it will enable.
I also met with many of our customers and team members on the Gold Coast, Hobart, Bathurst, Newcastle, Coffs Harbour, Wagga Wagga and Bendigo. Universally the conversation centred on the opportunities high speed fixed and mobile services were creating for people, businesses and local communities.
It is these moments that press home how critical telecommunications networks are in the world today. But they also reinforce the privilege and responsibility companies like Telstra have to deliver for our customers, albeit in a world that is very different to when Telstra was first creating Australia’s telecommunications backbone more than 100 years ago.
Today, disruption is ever present and takes many forms. Australia’s migration to the nbn, intensifying competition, changing customer expectations and an ever-evolving technology landscape continue to challenge us. But what remains at the centre of this exciting and equally challenging environment is our responsibility to deliver for our customers.
One of the key indicators we use to assess our performance in delivering for customers is the number of complaints we receive, including those to the Telecommunications Industry Ombudsman (TIO).
Over the last two financial years, as with the rest of the industry, our overall number of TIO complaints have increased, largely driven by issues associated with migrating millions of customers to the National Broadband Network. However it is also a trend across the telecommunications industry as connectivity continues to be ever more central in our lives.
While our complaints increased in FY17 and FY18, the rate of increase in FY18 showed some improvement. We saw customer complaints to the TIO (what are known as Level 1 complaints) increase by 7.7% (to a total of 82,528), compared to an increase of 43% (or a total of 76,650) in FY17, a year in which complaints across the industry as a whole increased by 41% (to a total of 158,016).
While I dearly wish we had no complaints, and that we delighted each and every customer each and every time, in a company of Telstra’s size and scale sometimes things can go wrong. We have more than 8 million customers and to keep things in perspective, while we had 82,528 TIO complaints in FY18 we had more than 285 million interactions with customers in our digital channels, more than 75 million interactions in our stores and over the phone and had cause to send repair crews (what we call truck rolls) 6 million times.
Another indicator we look to is the Complaints in Context report which has been released by Communications Alliance today. The report shows the number of TIO complaints per 10,000 services in operation (SIOs) for participating providers. Building on the positive trends shown in the TIO Annual Report, the most recent data again shows improvement over the last three quarters. From 7.9 in last quarter for FY18, Telstra has dropped to 6.5 complaints per 10,000 services in operation in the first quarter for FY19, an 18% reduction.
That many of the complaints received have been driven by the migration to the nbn is really beside the point – as a business, and as an industry, we have to provide the best possible customer experience and there are times when we at Telstra have not met those high standards.
So what are we going to do about it?
Our T22 strategy spells out the tangible actions we are taking to transform the customer experience by delivering simpler, more flexible products with a great digital service experience, as well as simplifying how we operate. For a business that touches virtually every Australian every day, either directly or through our wholesale relationships, it is a bold strategy.
For example, we know there are things we charge our customers for that are a major source of complaints. So as part of T22, we plan to remove up to those $500 million in revenues for our services over the next three years, the first example of which we introduced in July with the removal of charges for domestic excess data usage.
At our recent AGM I also announced we plan to stop charging customers for rental home phones, a move we expect will benefit up to 300,000 customers, and drop charges for call number displays on many of our older phone plans, welcome news for another 60,000 customers. We also plan to shift to a new digital billing experience, with direct debit as a default.
This means for customers taking up our digital billing experience, Telstra will no longer charge late payment fees, charges for over the counter cash payments or paper bill fees, as customers will be on direct debit with a digital receipt. In preparation for the phasing out of paper bills from the start of next financial year we will stop charging our customers the $2.20 fee. These are just some examples of the legacy fees and charges that we are designing out of our plans and removed for our customers.
We have also announced we will be simplifying and dramatically reducing our number of plans (complexity being another customer pain point), with 20 core plans replacing the 1,800 available today. Our next big launch for consumers comes next few week with a focus on choice, giving customers flexibility to choose and pay for only the services they want.
Over the longer term we believe these moves are in the best interests of customers as they accelerate a trajectory already underway and will drive long-term value.
Our commitment is that in future our consumer and small business customers and shareholders will also see a radically different Telstra, and have a radically different experience with us, built on simple, intuitive digital platforms that enable them to make changes to their products in near real-time via our 24×7 App. Improved training means service in our stores and contact centres will also be faster, easier and more digitally enabled and integrated than ever before.
Our ultimate success will be reducing the need for customers to contact us with queries and complaints by making things simpler, easier, and more flexible and giving them more control.
The next few months are very much like the last few in that I will continue to share more about the transformative power of telecommunications with our customers and teams at events (large and small) all around the country. Again I am certain the unifying thread in the many conversations at these events will be on how connectivity is now a key part over everybody’s lives. What continues to be in the front of my mind is the responsibility Telstra has for making it happen.