Telecom's Internet splits in two

Telecom announced this afternoon it is to split its Internet business into two new units - one, which will keep the Xtra name, will pursue the consumer market. The other will become 'the nucleus of a new, intensely-resourced online business solutions group' which will work closely with business and corporate customers 'to help them transform their businesses into online operations'.

Telecom announced this afternoon it is to split its Internet business into two new units - one, which will keep the Xtra name, will pursue the consumer market.

The other will become "the nucleus of a new, intensely-resourced online business solutions group, according to Telecom Services general manager Theresa Gattung.

The new Online Solutions Group follows on from a vision statement issued late last year by outgoing CEO Roderick Deane. He placed the company at the head of a move online by New Zealand business, with a particular emphasis on electronic commerce.

Gattung, who has already been rumoured as the senior manager most like to take up the torch from Deane in Telecom's move online, says this year is "a challenging and exciting time for Telecom. We need to evolve to keep pace with the demand of the new online world while, of course, continuing to maximise growth opportunities in the existing business.

"The Online Solutions Group will work closely with business and corporate customers to help them transform their businesses into online operations. Our customers in the business marketplace are keen to explore the huge cost-saving potential and competitive advantage which the online world will deliver,” she says.

Telecom's decision to go first for the consumer market when it launched Xtra in 1996 surprised many in the industry. The ISP has not turned a profit or etched out a consistent strategy for online content since then, but it dominates the local Internet access market, with more than 150,000 customers and produces more Web content than any of the country's established media businesses.

“Our current online provider Xtra has been tremendously successful," says Gattung. "Building on that success, we plan to take our business to the next stage by reorganising Xtra into two focussed units. One, Xtra, will target the fast-growing consumer market, and the other will become the nucleus of a new, intensely-resourced online business solutions group to operate in the corporate and business marketplace."

“Another proposed change to the Services structure involves the formation of a Product and Service Development group, allowing business units to focus very directly on marketing to their customers.

“Staff have been given an outline of the proposed changes and have been asked to give feedback on these ideas over the next week."

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