A few nuggets from the morning session of Telecom’s investor briefing in Sydney today, which I’ve been following via the webcast.

XT: the inhouse goal
Chief executive of retail Alan Gourdie said Telecom is aiming to upgrade one third of its base of CDMA mobile customers to XT over 3G network’s first 12 months.

The telco had 2,252,000 CDMA customers as of March 31, so it would have to migrate 675,600 of them during XT’s first year to meet Mr Gourdie’s goal.

Naturally, Telecom will also try to pinch as many Vodafone customers as possible, especially the ones who buy higher-end handsets and participate in the roaming market (which Mr Gourdie said was worth $250 million a year, combining domestic and international roaming).

Telecom didn’t provide a customer number here (though it does say Gen-i has already snatched a number of big customers from Vodafone), but Mr Gourdie did refined chief executive Paul Reynolds’ previous comment about 3G’s revenue potential.

Mr Gourdie said XT would boost Telecom’s share of mobile market revenue from its current 38% to 45% to 50%. He did not put a date on the goal.

In the past three or four years, Telecom’s share has dropped from around 48%, said Mr Gourdie.

The CDMA network will be kept alive for at least three years.

Group chief transformation officer Frank Mount said Telecom is "already looking ahead to 50Mbit/s LTE, which we will upgrade to as customer demand dictates." (More on 4G here.)

More mobile data, more Aucklanders
Telecom is relatively weak in the Auckland market both in customers and retail presence, Mr Goudie said. Growing in Auckland, and growing high value services like data (the telco hopes to sell 185,000 data devices for XT over 12 months, increasing penetration from 5% to 20% of its customer base.

Data card owners have an arpu - average revenue per user per month of $50, which is regarded as very good, and which Mr Gourdie expects to maintain after XT's launch.

By grabbing more high-value mobile customers (whom in Mr Gourdie’s definition account for 12% to 15% of the market), more roaming share, and more Aucklanders, Telecom can grow at 9% versus the mobile market’s overall 3%.

Mr Gourdie said Telecom wanted to double its number of mobile broadband connections by 2013.

Mobile coverage
Mr Gourdie took his usual dig at Vodafone's 3G network coverage, which the carrier rates as 97% of where "New Zealanders live, work and play" but which the Telecom head of retail puts at "60% to 70%".  Earlier today, Vodafone announced it had completed its 3G network.

Dr Reynolds also promoted Telecom's fibre backhaul for XT in 13 towns and cities.

NBR looks forward to both telcos submitting updates of the mobile coverage area to the government's National Broadband Map.

Lower arpu
However, although he’s predicting a big jump in customers, which will drive more revenue overall, Mr Gourdie also said that average revenue per user would fall due to Vodafone fighting hard to hold its own turf. Telecom expects to spend $200 to $300 per customer on post-purchase costs (that is, subsidising handsets).

Two Degrees launch as New Zealand's third mobile operator in August will also add pressure to arpu. Mr Gourdie said it was likely Two Degrees would attack the value end of the market, but noted the carrier has yet to reveal its pricing strategy.

Mr Gourdie also said that New Zealanders rack up relatively few voice minutes. He wants less txting and more talk (Vodafoners are claiming XT represents the death of Telecom’s $10 txt deal). He also sees new content services, and faster mobile data and “bolt-on” plans driving more data uptake.

Southern Cross Cable dividend
It looks like another boomer ahead for Southern Cross Cables Networks, the 50% Telecom-owned business that owns our only internet connection to the outside world.

For FY09 so far, Telecom has pocketed an $79 million dividend from the Bermuda-incorporated SCCN (it does not expect any dividend for its final quarter).

For FY10, chief financial officer Russ Houlden expects the dividend to be in the $50 million to $80 million range.

SCCN says its Australian business accounts for most of its profit.

The number of iPhone and BlackBerry Storm-friendly cell towers
Chief transformation officer Frank Mount said a total of 962 XT cell towers have been built.

Of these, 755 transmit on the 850MHz band.

198 are combined 850MHz/2100MHz.

And nine are 2100MHz only.

The 2100MHz towers are concentrated in cities, pointing to pretty good coverage for the iPhone 3G and BlackBerry Storm (both of which can run on that band), should someone want to take advantage of Telecom selling SIM card-only plans, then pop one an XT Sim into a BlackBerry or iPhone bought from Vodafone (read: iPhone on XT - it's a success, and simple).

Softly, softly on PSTN
Chief transformation officer said that Telecom’s fixed line voice (or PSTN) network is largely depreciated, low-cost to run, and has an extremely low failure rate.

He said Telecom has done very detailed analysis of the cost of PSTN versus the cost of transforming to an IP (internet protocol network) and found that it does not make sense to accelerate its roll-out of IP (which is so far restricted to a single phone cal). “The pragmatic thing is to keep those high margins in place and not make it a capital exercise for the sake of technology.”

Mr Mount said other telcos have moved faster on IP, but suffered lower ebitda as a result.

Under its Telecommunications Act obligations, Telecom must move to an all-IP network by 2020. Currently, it sees no financial sense fully transition ahead of that date.

Telecom shares (NZX: TEL) were down 3.45% in late afternoon trading.