The Telstra Group Ltd (ASX: TLS) share price has made a good recovery since its plunges in 2018 and again in 2020. But Telstra management is now eyeing other growth opportunities.
It has gone through the transition to the NBN, which caused a big hit to year-over-year profit growth.
Telstra is now working on rolling out its 5G service to customers. This can unlock new forms of entertainment, communication, and so on. It could also mean that Telstra is able to serve and connect industries in new or different ways.
With that in mind, it has been reported today that Telstra is focused on a particular area for growth. This could also help the Telstra share price.
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Can agriculture spur the next leg of earnings growth?
Talking to the Australian Financial Review, Telstra CEO Vicki Brady reportedly named growth of services to agriculture (and other non-traditional markets) as a key focus of her leadership.
These insight came about while the telco's CEO was attending the annual Mobile World Congress in Barcelona.
An important part of the strategy is working with more industries as digitisation increases. The AFR quoted some of her speech:
It is an exciting time to be in telco, and I'm looking ahead at the next decade as one of profound opportunity…Connectivity is the bedrock, but it is not the end point, it is just the beginning.
She pointed to the Australian Farmers Federation wanting to grow production from $75 billion today to over $100 billion by 2030, which could mean deploying internet of things (IoT) devices and other digital technology.
It could also mean connecting its mobile and IoT networks and satellites with other technologies, such as long-range wi-fi from companies like start-up Zetifi. Brady said:
Zetifi is a good example of us needing to get comfortable with not being the only connectivity option available.
This requires a mindset change. I've been in telco for more than two decades, and I've seen opportunities pass by because we were defending what we had, instead of thinking about the larger opportunity that could be created if we worked together.
If we don't, we risk others capturing that value over our networks.
…we are absolutely at our core a telecommunications company and I don't want it to be misinterpreted, as that will be critical … However, I think we've got an opportunity on top of that connectivity, with the ability to partner and co-create.
Overall, this could be quite positive for the business if it unlocks more earnings streams.
Telstra share price snapshot
Since the start of 2023, Telstra shares have risen 2.5%.
