Good morning, everybody. Thanks for joining us. Still a few people coming in and finding their seats, but I think we'll get started very soon. Welcome. Thank you for attending. We are really excited to be hosting TPG Telecom's first Investor Day. We've got the whole executive team and a number of other members of the senior leadership team here to present and mingle with you. We're really looking forward to talking to you and to answering your questions. I think we are notwithstanding that the cruise ships are back, somewhat blocking the view, but I think we're incredibly fortunate to be able to do this kind of event in this kind of place.
Firstly, because it's been way too long not being able to get together physically, but also because we're very fortunate that we are in the best city in the world, possibly in the best room, in the best city in the world to do this. It's important to acknowledge our ability to do this and our ability to be in this room and in this place to acknowledge our First Nations Australians, pay our respects to them, and to pay respects to their elders, past, present, and emerging. It's also important to make sure that we are safe and that we are comfortable in this room. A few housekeeping matters.
Firstly, in the event that there is a fire or any other emergency that requires us to get out, fire exits are the way you came in and out there where we're doing the catering. Follow the instructions, please, of the MCA function staff in the event that we have to get out. Bathrooms, if you haven't located them, are either side of the lift. The gents is on this side, the ladies on the other side. The catering, I'm sure you've all noticed, is outside. We'll be serving some morning tea during the coffee break out there, and also a light lunch at the end of the event.
If we do have to leave the building, the assembly point is First Fleet Park, to the south of the harbor side entrance there, where they've hopefully finished disassembling all of the Vivid equipment that was there yesterday. Wi-Fi details for those who need it are on this slide. I'll just let you all have a quick look if you wanna write that down. I won't try and say that out loud. I also would ask that you just check your surroundings. If you've got a coat on the back of your chair, if you've got a bag on the floor, just make sure it's secure and not presenting a tripping hazard to anyone. Also, along that back wall, please avoid storing things along there. It just gets in the way of the blinds.
Today's agenda, we'll begin with Iñaki, and then we'll have presentations from Kieren and Jonathan. We'll have a short break, cup of coffee, check your emails, and then we'll go into presentations from Ana, from Giovanni, and Grant to close. We'll have the whole executive leadership team up here on the stage for Q&A. The event is being webcast. Due to a few people not being able to attend at the last minute because of COVID, we have opened the webcast for Q&A. During the Q&A, I'll be monitoring questions here that come online and reading those out. There will be a full archive and transcript of the event made available on the TPG website as soon as we can get it processed. With that, I'll hand over to Iñaki.
Thank you, James. Welcome, everyone. I think that before I start, some of you will be observing what a premium experience we get here with the view, with this room. Just to make it clear so you don't get the wrong impressions, this is actually really good value. It is very inexpensive to get this room. This is what TPG is about. We get the premium experience at the right cost. Anyway, that said. Yeah, very excited to be with all of you. I think that this is the first time that we do a proper in-person presentation of what we are about.
I think that the highlight of the day is actually that after this presenter, you're going to be hearing from the executive team of TPG, and then you are also going to be able to engage with all of us in the Q&A. I think that that's an opportunity to really, you know, not just get our views on the market and where the company is going, but also to engage with the team that is leading this company. We will start with that. We will also talk about maximizing our potential. A bit about what are our plans, where do we see us playing in the future. We'll talk about strategic direction, operational focus.
I think that we are also going to talk a little bit about providing a bit more guidance around financial frameworks, and also how to interpret some of our disclosures in the business. Let me start by saying, you know, in 2020, when we started this journey, we set a very clear focus on, at the same time that we integrate and we deliver synergies, to make sure that we keep our eyes on the ball. To make sure that we have operational focus on the business. It was a time where, you know, we were merging two businesses in the middle of a pandemic. There was a lot of people leaving the market and affecting us in a disproportionate way.
We had also, for you know, regulatory reasons, a significant gap in terms of our 5G rollout. All that had to be taken care of at that time. In 2021, we communicate a bit more around the three parts of the three guiding principles of our activity. First, integrate and simplify. Second one, win smart. The last one, maximize our potential. Integrate and simplify was really around creating a simple, lean, but also a scalable platform for our technology, people, and processes. We were moving from a somehow divisional structure to an end-to-end company, a platform that was looking end-to-end to all our infrastructure, all our brands, and be able to provide with that the opportunity to scale better.
We concentrate on winning smart, which was taking opportunity of some of the advantages that we had at the time and, you know, fixed wireless is an example of that. There is maximizing our potential, and I think that this is what I wanted to talk about a bit more today. What is maximizing our potential? I think that TPG will have a unique opportunity to become Australia's best telco. We have the unique opportunity to become Australia's best telco for our customers, for our employees, for our shareholders, but also to the community that we operate. I think that today, more than ever, our simplicity and the value that we provide are more relevant. We are a focused company. We provide telecommunication services. We are proud of that. We are not shy of saying it.
We want to be the best of that. I think that's really our aim. We are also creating a very strong culture in the business. This merger has allowed to accumulate incredible talent around the sector, and also, you know, a core team of people that share a lot of commonalities about making TPG a great business to work. Our values stand together, so we are creating one company. We are one company, and we operate as one company coming from many different businesses. The second value is we own it, so we take individual and collective pride of what we do, and we are a company of people that are accountable. We are all accountable of what we do, and we have a culture of accountability. We are bold, and that's our third value, boldly go.
We really are not shy of taking the bets that we need to take, the right calls. The last one, the last value, which is simple, is better. This is something that has characterized our business for a long time, and we think that is a competitive advantage, especially because we are able to be efficient, but more importantly, we are able to provide a much simpler life to our customers. In the wake of COVID, customers are experiencing a lot of cost of living pressures. We see a telco industry that continues to be squeezed by the NBN cost pressures and also by the fact that, you know, there are elevated capital requirements delivering our 5G promise.
I think that this is an environment where our company, our simplicity, and the value orientation can really help us to thrive. I think that the pandemic highlights some of the challenges of the company, and I think that, you know, we did lose more customers who were more exposed to the international business. It also highlighted the fact that our regional coverage was smaller than our competitors. These are things that we have really addressed, and I think that we have put a lot of emphasis in recovering the commercial momentum, and more importantly, also in looking at how we find a solution for our geographical coverage. We will talk a little bit more about that in the Q&A.
At the end of the day, I think that we are now, through this merger and through the changes that we have made, ended up with a company that is going to be able to provide telecom services across all the different technologies. We will be able to do that across all the segments with our emphasis on not just consumer, but also enterprise. I think that the other thing that will be a significant change for our business is across the whole country. We are focused. We are very proud of being focused on telco and on being also a great value provider. This, like I said, this ambition is quite simple.
We want to be the best for our customers, leveraging on our low cost. The best for our shareholders and doing that by capturing more market share, growing earnings out of our leading cost base, and with a highly efficient and transparent capital management. We will also be the best for our people and community by building our position as an employer of choice, and then focusing on the wellness of our people, delivering our sustainability commitments in customer wellbeing, environmental responsibility, inclusion and belonging, and also on the digital economy. We are entering, like I said, a period of growth, and we do that as a full service provider.
In the coming months, we will put a lot more emphasis in providing more depth of granularity into the different targets that we have set as a business. Today we're going to concentrate on 10 strategic initiatives. We'll start with Kieren. Kieren will concentrate on the consumer initiatives. We'll talk about targeting growth in consumer mobile business from about AUD 1.8 billion of service revenue today to capture a greater share of our growing addressable market. Second, driving greater profitability in our consumer fixed business. We want to maintain our leadership on NBN but also look at non-NBN services to increase our profitability. Then the third one around the cross-selling opportunities that we have to get in more of the households where we are present with more products.
Jonathan will cover two key initiatives in enterprise, growing our revenue. We have already announced our ambition to be AUD 1 billion revenue by 2025 in the segment. Also the second part, which is unlocking the value in wholesale by driving a much more utilization of our high-quality assets. We'll have the break, and after the break, Ana will detail two key initiatives around customer operations, streamline our customer platforms, and secondly, improving the customer experience with focus on digital payment experiences. Lastly, Giovanni will talk about simplifying our technology landscape. The last one on how we are going to develop our five-year roadmap in conjunction with our regional sharing agreement.
Once this presentation is done, Grant will provide more detail on our capital allocation framework, and also we will be providing a bit more disclosure, in the appendix of our presentation. Before I hand off to the team, I think that, you know, one thing that I've been talking to many of you, in different meetings and even today is, you know, where I see the market different. Why is this a different time, and why is this an opportunity for us to really, you know, maximize this potential that the new TPG had in a market that I think has much better conditions around capturing value?
One of the things that I want to talk is the fact that we are exiting a period that, in my view, has been dominated by the distortion that the significant payments that NBN has done to the incumbent and to Optus that has created, I would say a period of heavy and probably unsustainable discounting that we don't think that will continue. I think that that, you know, almost 10-11 billion dollars that have gone to the two players really have developed some behavior in terms of the way that ARPU has performed that we don't see replicating. We don't think that that opportunity to get almost AUD 10 billion of free money in a way will happen again.
I mean, don't look too much into the numbers on the ARPU. Get a bit of the trends. I think that ARPUs in this market are not all created equal. You can see how during the period where the NBN payments were higher, we had a really very aggressive pricing decline. I think that we are getting out of there. Everybody's talking about market repair. I think that we've seen market repair, not just in pricing, but also in the behavior of different players around how we share infrastructure and how we look into making decisions that are much more focused on generating more value out of the industry.
In this context, and with the fact that we enter this space with a significantly growing addressable market, and I have talked about how the regional network share deal brings us from being a very good metropolitan player with good quality network, but restricted in area to a nationwide player and increase access into our addressable market will allow us to be, you know, I think quite effective in capturing a bigger market share than what we have seen in the past, and in a way that is more sustainable. A bit of comment on NBN. We've seen, you probably have read the proposal that NBN has done to the ACCC around pricing.
I think that there is a fundamental problem around the way that NBN is looking at how to monetize what you know their service and looks like the only way that they see growth in the future is by making obsolete products more expensive every year. It looks like even though they've been running the business for quite some time, you know, there's still an emphasis on making you know NBN 25 and NBN 50, which are you know pretty basic connectivity products extremely expensive in the coming years. That's the only way to grow. We really oppose that. We oppose the complexity that that represents. At the same time that represents a challenge for the industry, it also represents good opportunities for us.
While we commit to continue being a leading NBN retailer, we are also, like we have done, you know, exploring the opportunities that we have on net to provide home broadband services in a much more profitable environment. That includes our fixed wireless, but also, you know, the opportunity that we have with our fiber to the basement and the rest of, you know, own access network that we own. Just a quick recap on where we are since results in 2021. I'm just going to go through some of the numbers before I hand over to the team. I mean, we have solid momentum this year. I think that we're looking at the second half of the year continuing this momentum.
We are accelerating our targeted AUD 125 million-AUD 150 million merger synergies, and we will be doing that 1 year early, so by the end of this year. This has been enabled by a huge simplification of our organization, and we did take that in the beginning of the year. Our network expansion is on track. 5G delivery targeting 1,000 5G sites this year, so everything is going well and we are, you know, building more and more sites every week and, you know, bringing more and more customers on the 5G network. We will talk a little bit about the regulatory process around our regional sharing agreement.
I think that trend that is with us, we'll be able, in the Q&A, to address a bit, at what stage we are. We recently closed the sale of our tower assets to OMERS for 32x EBITDA. I was extremely happy about that transaction. Fixed wireless, we did anticipate some supply chain challenges, but we, at the time, said that we will confirm, you know, the 160,000 customers by the end of the year, and we reaffirm that we will be delivering this number of customers onto our own network fixed wireless product by the end of the year. Enterprise, you know, traveling well.
We had some really great wins and, you know, Jonathan will be able to talk a little bit more about that later, and we continue to reaffirm our AUD 1 billion revenue target. Then on wholesale, the approval of the functional separation and our residential access network, which, you know, really helps us to increase the penetration of customers on that infrastructure. You know, in general, a good momentum commercially. We will be announcing roughly 120,000 net adds or more than that for the first half of the year and we are very satisfied with the level of performance. The other area where we have been working significantly is around our sustainability strategy. Since launch last October, we are concentrating in four areas.
The first one is customer wellbeing, a lot of activity there. Unifying across the brands, making sure that we scale and step up in all our brands around our customer wellbeing. Second one is around environmental responsibility, and we're working on our targets and, you know, we'll be disclosing more and more on that. Today, we have our General Manager for Sustainability, Ian Dilly, which I don't know where he is, but he's someplace over here. Yeah, so you can mingle with him during lunch, and he's doing a lot of incredible work. The third one is around inclusion and belonging.
Again, this is part of our aim to become best employer, but also, you know, to make sure that we make in TPG really attract the talent but also invest and dedicate more and more time in our people, making sure that this is the great place to work that we want to make. Finally around digital economy. Like I said, if you have the opportunity to talk to Ian, this is a very important area for us, and an area where we will be making more and more commitments, but also we will be, as we operate, we start in October disclosing more and more of our ambition in this end. Now I'm going to introduce Kieren to all of you. You probably know Kieren, and he's going to go through the consumer. After that, I think that we'll have the rest of the presenters and the Q&A. Thank you very much.
Thank you, Iñaki. Thank you everyone for joining us here today. As we just went through with Iñaki, we've got these 10 key strategic growth areas we're focusing on to really deliver our growth. Today I just wanted to unpack the 3 that relate to consumer. First of all, it is to create a vibrant and a growing mobile business. As Iñaki said, we have a network that is now bigger and better than it's ever been, and it's only gonna get more so off the back of the Telstra network sharing agreement, which I'll go into more in a second to really explain from our point of view why we think it's good for customers, why we think it's good for competition, and why we think it's good for our business as well.
The next is in fixed. While we believe and still are heavy supporters of the national broadband network, it's still a key component of our fixed portfolio. We also have access to alternative technologies that allow us to provide optionality, provide greater value for customers, and also to protect and to grow our margins. The third is to accelerate cross-sell. Just put simply, to sell more mobile services into our fixed customer base and to sell more fixed services into our mobile base. We've made great positive progress in that area, but it still remains one of the key growth areas that we have going forward, both in terms of number of services and of revenue.
If I may, I'll start with what we're hearing from our customers and really relate to how that really governs and how it, we see our place in the world and where we see it really playing to our opportunities. Firstly, and probably not surprisingly, one message that we hear loud and clear from our customers is how cost of living has become front and center. That inflation, interest rates, price increases, supply chain issues all weighing heavily on the minds of Australians. Just recently, I think about a week ago, Roy Morgan released the Consumer Confidence Report, and it showed that in June, we dropped to the lowest level since April in 2020. It's lower, much lower than it was a year ago while we were still in lockdown.
This is relevant for us because in this environment, Australians are putting the costs of ongoing services under increased scrutiny as they rationalize any financial commitments they have. For us, as a telco, we are one of those services. We're one of the most common and generally considered non-discretionary costs that an Australian household spends every month. Building on this is the second point, that Australians are becoming increasingly mistrusting or distrustful of complexity, in particular, when that complexity comes in the forms of services that come as part of a trial or a bundle that are snuck in and that eventually start to cost real money over a really extended period of time. Channel Seven recently reported that as Australians, we waste about AUD 4 billion a year on unused subscriptions.
About 60% of us, they estimate, are paying for digital memberships, digital services we no longer or never did actually use. Now, in rosier times, consumers may have forgiven that. As mentioned, in times of constraint, greater scrutiny is put on things like this. This is relevant for us because in our industry, some of our major competitors have an expansion strategy that sees them moving into services like this. Services such as energy, aerobics, all sorts of things. You've probably heard the theory that these additional services in some way entangle a customer and create a point of difference. For what it's worth, from our experience, content creates very little switching behavior. As a result, these expansion strategies can end up being an expensive strategy.
If these services are not profitable in and of themselves, other telcos might be tempted to look for their customers to cross-subsidize the bloat and the additional cost these services inflict on the business. We think a little differently, and I'll go through that in a moment. The third message that we hear from Australians, and also this is probably no surprise, is that as more and more of our life is digitized, from school to work, from shopping to entertainment, they're demanding, they're expecting the telco services to be reliable and to be strong. Lastly, and positively, after years of limited travel and as borders are reopening, the big message we're hearing is we're really looking forward to traveling the world and to welcome the world back into Australia.
I say all of those just to pause for a moment to reflect that we believe that we are very well-positioned to better satisfy those needs than anyone else in the market. I'll just go through those. As Australians are becoming increasingly focused on the cost of living, TPG can leverage, as Iñaki just went through, our lower cost base, providing customers with simple, clear value while still protecting and growing our margins. As Australians grow increasingly distrusting of the complexity of services that are snuck into bundles and trials, we can provide transparent, simple-to-use, high-quality telco services because it's all we do. As Iñaki said, we're a telco. We're proud to be a telco. We don't wanna be a techco. We don't wanna be anything else. This focus allows us to not be distracted and not carry the cost of flirtations into other industries.
As Australians are demanding greater reliability of the telco services, we have made huge strides in the quality of our networks. In metropolitan areas, our mobile network is as good or better than our competitors. We are now the fastest-growing 5G network in Australia, and with recent network sharing agreement, that's only set to get better, and I'll touch on that more in a moment. Finally, as borders reopen, TPG and Vodafone's leading proposition for travelers, and that's both inbound and outbound, again becomes an unbeatable competitive position. Let's turn to mobile. As Iñaki mentioned, and as we went through at the beginning of the year, our mobile business stabilized towards the end of last year and in the beginning of this and has now turned to growth.
We're on track to deliver more than 120 net growth customers in the first half of 2020. We understand that sustainable and sustained growth is a long-term track, and we'll have steps forwards and we'll have steps backwards. We're confident that the levers that we're tracking to are the right ones and the ones that'll continue to drive growth. I'll just go through these briefly. Firstly, as we've just covered, given our cost base is far lower than our competitors, we're able to take a leadership position on providing value to Australians while still maintaining and growing our margin. As I mentioned, this is now more relevant than ever as cost of living becomes front and center. Secondly, as borders reopen, we are well-positioned to capture growth into our international brands of Vodafone but also of Lebara.
We have strong propositions for incoming and outgoing travel. Our AUD 5 roaming is still unbeatable, and we have targeted offers for the international inbound tourism and also for students. Since the beginning of the year, roughly about one-third of our sales has come from these international inbound travelers. Now, we are aware that a large portion of inbound travelers and international travelers are short stay, they're very welcome, they're very profitable, we love them as customers, but we do expect that they have a shorter tenure than domestic customers. Next, we focus on major sales periods during the year. It might sound self-evident, but it was a change we made last year, and it's one that we continue.
Instead of consistently being on sale and spreading our investments, effort, and attention across the year equally, instead, we double down on key moments when the market is moving, meaning we're far more targeted in our offers, far more targeted in our campaigns and our channel executions. For example, currently, we're in the middle of our end of financial year sale, and we have leading value propositions for both devices and plans. Although we still have a very important final week to go for the end of year sale, we're very pleased with how it's going. Just quickly, it looks like it's probably up about 45% on the same period last year from a sales perspective. Churn management and building our relationships with our customers is the next and a very important one.
Clearly, acquisition, as I've just mentioned, is very, very important, but we are not a transactional business. It's essential that we start to build relationships with our customers that become more personalized, become more trusting, and become more valuable over time. We've renewed our focus in this area, and we've shown some very positive early results. This has been enabled through attention in terms of our upgrade campaign, campaigns to reconnect our customers, and also really doubling down into our next best activity, so we can get that right message to the right customer in the right channel. Lastly, but probably most importantly or most centrally, our network is the best it's ever been. It's wonderful to hear that message coming back from our customers. We have Australia's fastest-growing 5G network. We now have about 90% in our metro areas population coverage.
Giovanni is gonna take us through how we're gonna continue that growth. From a consumer perspective, 5G is now available to almost all of our metropolitan customers. We have 5G plans that offer excellent value as well. Above all of this is the planned network sharing agreement that we have with Telstra, and I'm gonna get onto that next. Just before I do, the other point to notice is we've also seen strong ARPU performance as well through that period. As we covered in January, that's continued, and this has been driven by the focus of mix at the point of acquisition, as well as upgrading our existing customers throughout their term. We see this customer growth being able to be further accelerated off the back of the regional network agreement that's been talked about with Telstra.
It's still subject to regulatory approval, but we're confident that it's very pro-competitive, that it has huge public benefit, and that it aligns with ACCC's desire for more competition for Australians. Why is the MOCN so important to our business? I'm just gonna build on a few things that Iñaki said. Currently, effectively, we really compete and operate as a metro telco. If you're a customer in one of the major cities, we'll deliver a network experience that is as good or better than anyone else. The reason that we're focused on the cities is the economics. Put simply, for us to build in regional areas doesn't make any financial sense. This has meant the true national competition in the mobile operators has been lacking for too long.
We haven't competed for these customers who've in turn had limited options in who they can choose to do business with. This is reflected in our market share. In areas of metro, we're in the 20s%, we're in the low 20s%, but it drops to single digits% as you move further out into the regional areas. The network sharing agreement has the potential to change this and provide us an opportunity to grow across all regions. There's really three dimensions of that growth that I'll just touch on now. The first is churn reduction. This agreement will directly address one of the largest drivers of mobile churn, lack of regional coverage. We lost customers during COVID because they'd either moved to regional areas or they were traveling more to regional areas 'cause they couldn't travel internationally.
When they did that, they started to bump up against the edge of our network. With this, we'll be able to effectively recontact those customers, re-win those customers, but also attract customers who also value that kind of coverage. Next, we'll be able to help drive acquisition in our cities. There are specific segments of customers that live in cities, but who frequently travel to remote or regional areas of Australia, either for work or for holiday. These types of customers probably wouldn't have considered us in the past due to our smaller regional network. With the network sharing agreement, we'll be able to compete for their business, providing us with quite a considerable growth opportunity.
Lastly, and probably most obviously and fundamentally, acquisition in our regional areas, as more than 4 million people that are covered by this regional network will be given a choice of another mobile operator. Important, through this deal, our core network will still operate without towers, our 4,800 towers in exactly the same way that it'll operate with Telstra's towers, the 3,700 towers. That's important because that allows us to control our product experience, our pricing experience, our real points of difference. I wanna pause for a moment to explore how this change in our national network footprint affects our growth in mobile, and specifically, how it may set us on a different path to our competitors.
For the economic reasons we just covered, we have historically, for all intents and purposes, operated as a metropolitan telco. We essentially don't compete for customers in the regions or for customers that spend a lot of time in those regions. Our addressable market is, by our estimation, about 60% of the population. Under the network sharing agreement, that grows to nearly 100%. This once in a generation, 60% increase in addressable market is uniquely available to us. As far as we know, neither of our major competitors have a demonstrable increase in their addressable market plans. Given the difference, it would be reasonable if we were to adopt a different strategy to that of our competitors. On that point, we note that one of the other major telcos recently announced they're increasing our prices.
Their prices, not our prices. They definitely increased their prices, and we were asked in the lead up today, were we gonna follow suit? Now, clearly, we will never foreshadow what we will or won't do with our pricing. Instead, I would simply observe that our proposed network sharing agreement puts us in a very different position to that of our competitors. Put simply, this 60% increase in our addressable market gives us more options on how we can grow our business with increased share, increased revenue, and increased margins. If a competitor has no material change to their addressable market, then in a mature market, gaining additional customer volume would be difficult. One of the few options available to them would be to grow through increase of prices to the customers they already have. We, however, are in a very different position.
Given that this 60% increase in our addressable market, we would be able to grow our business by simply taking our services to customers who currently don't consider us and capture the natural market share of this broader market. Now, again, to be clear, I'm not in any way foreshadowing what we will or what we won't do with our pricing. Just simply observing that we are not reliant on a single lever of growth, but we have more options. If I turn now to the fixed line business. The NBN will remain core to our fixed portfolio. We're committed to maintaining our NBN subscriber numbers. However, it's well known that NBN margins are very low, and they're damaging the industry, as Iñaki just went through.
There is an opportunity for us to provide alternative fixed access technologies, such as our drive to transition a proportion of our NBN base onto fixed wireless. This provides an opportunity for customers to get comparable or a better product experience for more competitive prices. It provides us the opportunity to protect and to grow our margins. We've continued our fixed wireless momentum. We now have 110,000 customers on our network compared to the 80,000 we had in December. Although modem supply issues did slow our progress through the year, we are maintaining our target of 160,000 fixed wireless customers by the end of the year. We also remain optimistic that over the long term, about 20% of our base will be moved to fixed wireless.
We have that confidence because, A, the feedback we have from our customers that use the service, and B, when we poll and when we research customers, there's a real excitement for it. Recently, we researched our TPG base, and two-thirds said they would consider moving from their existing broadband service onto a fixed wireless. Similarly, our consumer FTTB, VDSL, and HFC products provide us with margin benefit over the NBN. Following functional separation, TPG increasingly thinks that this is a wholesale opportunity. Jonathan's gonna take us through what our plans are in that area in the next session. Lastly, I'll turn now to cross-sell. We are a recently merged organization, one that brought together a business predominantly focused on fixed with one that was predominantly focused on mobile.
This in itself presents a huge opportunity for us to introduce more services into these more, single-minded customer bases. We have made solid progress through the year. Our level of cross-sell is still relatively low compared to our competition, so we still have a big upside ahead of us here. Our focus this year has been on driving cross-sell, while at the same time, building the foundational capabilities to enable us to do this at scale, and it's delivered some really positive early results. The number of fixed services we have on our traditional mobile brands and the number of mobile services that we have on our traditionally fixed brands has grown by about 10% year-on-year. This has been driven by increased and improved cross-sell programs, making great progress in our call centers, and in our new fixed and converged propositions.
I'll now close by introducing the consumer leadership team. From left to right, we have Claire Aramenko, who's also just sitting here behind Iñaki. Claire is Group General Manager of Commercial Planning and Strategy. We have John Casey, who is lurking in the back corner, who is our Chief Marketing Officer. We have James Gully, who is our Group General Manager of Sales. Andrew O'Connor, who's a Group General Manager of Fixed and Fixed Wireless Products.
Arthur Panos, who's our Group General Manager of Mobile and Devices. Paul Tierney, our Group General Manager of Customer Lifecycle Management. We have a brilliant team. We've just come together from the best parts of TPG, from the best parts of Vodafone, and many people who are new to the business but are excited by the opportunity we have ahead of us. We've recently simplified and integrated our teams, so we're leaner, we're more efficient, we're more focused, we're more hungry, and we're more focused on our customers and on our growth. I'll now hand off to Jonathan, who's gonna update us on the progress in the wholesale enterprise and government segments.
Good morning, everyone, and thank you, Kieren. My name's Jonathan Rutherford, and I look after enterprise, government, and wholesale. Today, I'm really excited to take you through 2 key parts of our strategy. Firstly, we'll begin with an update on the great progress that we're making on the enterprise and government side of the business against our AUD 1 billion target that Iñaki talked about. Then secondly, I'd like to share a little bit more insight and detail into wholesale and why we see some real opportunities to unlock additional value in our wholesale business. Before I leap into progress, though, I'd like to start a little bit and just explain why customers choose TPG Telecom, especially in the business, enterprise, and government markets. There's 4 key things that stand out for us.
The first one is the level of commitment we have to the business market. We're committed across a whole range of areas, and what that means is it turns into a high level of quality, reliability, and really important customer focus, all wrapped up in great value for the business market. Secondly, we're really relevant to all businesses. We operate from small businesses that want great value bundled communication services, all the way up to large enterprises that might want software-defined networks to help them enable hybrid working. The third one is we're a company that really focuses on delivering services on future-ready technology. By that, I mean, you heard Kieren talk about our ultra-modern 5G network, but we also have one of the best and widest-reaching high-capacity fiber networks for customers.
We focus on products and platforms that are really relevant, not just now, but in the future, and we do it in areas that we can scale. Finally, I think the other thing that's really important is, while we're a large business, we still have a challenger mindset. By that, I mean we look at what's right for the customer, we try to keep things really simple, and do it in a way that can be beneficial for the customer but also help us drive value as a company. We can see that the enterprise market overall, it's worth about AUD 9 billion a year. It's a large market, and we have a big ambition to take a big share of that in revenue terms. We focused in on four areas when we came together as a new company last year.
We announced our enterprise strategy in December, and we focused on four key pillars of growth. We've seen some really great progress over the last year against that. In terms of connectivity alone. We've seen our business grow 25% in terms of our fixed data connections that are on our network or on the NBN network. We're seeing really solid growth in enterprise connectivity. We've also seen accelerated growth in the government segment through a number of projects you can see here, and we'll expect to get somewhere around low single-digit growth in that business. In small business, we are bringing to market a converged offer integrating mobile and fixed for the TPG Telecom brand, which is really important so that we've got one offer on one bill that we can bundle together with customers and allow them to consume really easily by buying online.
We also launched a new telesales channel, and we've scaled that up so that we can really attack and address that competitive opportunity in the small business market. We've made some really important strides in new services, what we call network managed services and security. We've won a number of large SD-WAN implementations with new technologies, which puts us in a very different position in the customer. We're no longer purely talking about carriage or connectivity. We're also talking about business enablement, how to deliver hybrid working, how to help companies connect to the cloud or change their working styles and patterns. That creates opportunity for additional products and services like 5G, like always-on connectivity, even security. Finally, in IoT and mobile private networks, we've seen really strong growth in our volume of IoT connections up over 20%.
I'm also delighted to announce that we have won our first mobile private network for a company called Yancoal, that we are now in the implementation phase. We committed to move into this area. We put the right team against it with the right partnerships. We've got our first win, and we're scaling it. We see four really clear growth opportunities, and I'd like to touch on each in a little bit more detail over the coming slides. Firstly, when we think about enterprise connectivity, this market's really undergoing a transition, and it's undergoing transition for two reasons. The first is customers are demanding more data. That's a fact. You can see it all around you in your own behaviors and consumption. More data created, more data consumed.
The second big thing that's changing is where that data is being consumed and how it's being consumed is also really important. With hybrid working, customers are using that data in many more locations than before. With the adoption of cloud services and the move to cloud, network architectures are changing. How you connect to the cloud, how you do it securely, and how you make sure companies can use multiple locations and multiple cloud services. All of that creates opportunity for new connectivity and new services. Within this connectivity market, we see an opportunity to grow from just under 10% market share to about 15% market share. We can do that through a number of different initiatives. The first one that we see is an opportunity using our existing on-net fast fiber services. We've got a great network.
We reach 13,500 commercial buildings, multi-tenant commercial buildings, but we also build and integrate new buildings where we see economic sense. We can then extend our reach using NBN. A bit like Kieren talked about with the MOCN deal on mobile, you should think of NBN as a way of reaching new customers that we couldn't reach directly, which increases our overall addressable market. Our aim will always be to use our on-net services first, to selectively invest where it makes sense, and then to expand using NBN as the second option. The third key area for us, which I think is really important is critically 5G and also fixed wireless access give us access to new customers in new areas that we couldn't reach.
If you could imagine you're a large retailer, for example, some of your retail stores will connect on fiber. They'll be in business parks or in areas that are very close to the urban population. Some of them might be more difficult to reach, but we'll use NBN. Some of them, you might actually want to do a pop-up retail experience connected over 5G or even a temporary retail experience, say, on a service station or a highway, which we could use fixed wireless access to do. Suddenly this complementary range of technologies allows us to address much bigger customers in many more locations than we would have done before. We see a really strong opportunity to continue growing in the enterprise connectivity market, which you can see is about a AUD 3 billion market in its own right.
The ingredients we think that help us win there, critically, a lot of the points Kieren talked about for consumer are also true for enterprise. The first critical ingredient is around delivery. I think TPG, overall TPG Telecom has a very strong reputation in delivery. I've just highlighted a few different customers to give you some examples of how this becomes a real competitive strength. One of our recent wins and acquisitions was Hungry Jack's. A real desire to get better management and support of the network. They wanted to get a national software-defined network delivered across their entire estate. That was something we were able to do quickly, effectively, and of course, wrapped up in great value. When you look at NAB and what NAB were looking to do, we delivered a project to over 850 dedicated sites.
We did this in a way that was very, very quick, in 9 months, but also ahead of schedule. With Lifeline, we deliver mission-critical services. They play a vital role in society, and we had to deliver a new network, but at the same time, make sure there was zero downtime, zero service interruption, and a fully seamless handover. Which, as you can imagine and appreciate, given the service they provide to the communities in Australia, is really, really important. Finally for Mosaic, this was one of our largest implementations. Over 850 stores connected in 3 months and over 1,000 stores in total. It gives you an idea of how fast we can deliver and how much we can do when we use our own on-net network infrastructure combined with NBN or 5G or fixed wireless access.
I think that's really exciting around the opportunity purely in connectivity. I'd like to talk a little bit about small business as well, which I think is a real strength where we see value that comes from the merger of two great businesses. By bringing TPG's fixed assets and VHA's mobile assets together, we now have an ability to cross-sell and to develop more products that can really help small businesses. Now today, we only have 4% of the customer base in small business that has multi-product. Now, I must stress by multi-product what we mean here has fixed and mobile. Clearly, lots of customers have broadband and fixed voice, but there's only 4% of those customers in small business that are currently combined. You heard Kieren talk about 20% in consumer.
Again, big opportunity purely to cross-sell mobile and fixed and bundle together. For the near term, we're focusing on two big enablers. The first one is channel and the second one is proposition. As I mentioned, we've launched and built a new telesales channel, which will let us address that market that's typically quite hard to reach and pretty time poor. Alongside that, we're also introducing mobile on the TPG Telecom brand, as well as a range of cross-sell broadband offers on the Vodafone brand. We can go and address those customers that want to get great value connectivity, simply packaged and simply delivered. Over time, we'll enhance that further.
We'll bring in simple security services, and we'll bring in some additional value adds, but all the time, highly targeted and relevant to what customers want to do in this segment, which is get great connections that work and keep them in business. We can see real opportunities as we go forward with the investment in online that we're making in a common platform across consumer and small business. Also, as we improve our analytics capabilities, we'll see the opportunity to improve churn and also drive additional ARPU uplift from this segment. The third growth pillar that I talked about is all around network managed services. This is a real exciting opportunity for us. The benefits you'll see on the right are pretty clear.
When we sell managed services to a customer and we remain really focused around network, and by network, I mean the core carriage services supplemented with maybe a managed firewall or a managed local area network or a managed software-defined network with some cloud connectivity to help them connect to multi-clouds. We then do that with a wrapper that includes the design, the deployment, the installation, and then the service management of that. We see the opportunity to increase the average deal size and the average revenue that we can make per customer. Not only do we do that, but we pull through more connectivity. It gives us a more relevant role with the customer, which can allow us to then pull through fixed, but also mobile connectivity. It allows us to do it in a way that we still retain a very attractive blended margin.
We can grow the business, we can be more relevant, we can drive more product, and ultimately, we can lower churn in that business. What's really important for us is that we stay very focused. We're very clear that it's around network managed services and the associated security services with those network functions. It's remiss of us to say we would never look at further ICT solutions, but the focus in the short term is very much around scaling what we think is a great opportunity on the back of that connectivity market and network managed services. The final big opportunity in enterprise and government, again, comes from how do we take some of the assets we have in our core business and really leverage those to be great at delivering new services in IoT and managed private networks. It's an attractive market.
We can see it growing about 20% CAGR to 2025, and we can see that there's two big components in that. IoT connectivity and mobile private networks, where companies buy a network for their own use, either to automate a factory or to automate a port. Maybe it's to provide more security in a mining operation or automation of mining vehicles. We see some really important ingredients that make us confident in our ability to execute and win in this market. The first one is what you need are strong partnerships, and we have those across a range of technology vendors and also globally through some of our relationships that we have with both Vodafone Group and Hutchison. Global experience is really important.
We operate a platform that allows us to sell services globally, and some of our clients use this platform to reach the US, Europe or the rest of Asia. Many use it purely for the Australian domestic market. We have a platform that's able to scale globally as well as support us locally. It's really important that we've got relevant network technologies. Within our network, we have narrowband technologies, we have 5G technologies, and of course, we have the existing LTE services that we provide. We can see some really clear growth opportunities in different verticals across utilities, energy, ports, mining, manufacturing. As I said, I'm super delighted to announce the first win of our first mobile private network with many more to follow as we get through our sales pipeline over the next few months. That's enterprise and government.
I'd like to move and turn attention to wholesale, which, as you see on the slide, the strategy is all around unlocking value in wholesale. We think we've got some really interesting assets, and we think there's some big opportunities to get more value from those assets by opening up access to them right across the market. Firstly, I'd like to start with showing the wholesale business in three areas. We have mobile wholesale. This would traditionally be known as an MVNO market. The second opportunity you see is fixed wholesale, selling our wholesale, fiber and fixed data services into that market. Then the third one is what we call the residential access, the superfast broadband market.
These are some of the assets Kieren previously mentioned that allow us to offer services to consumers that traditionally had been unable to compete until we were granted and moved to having functional separation. I'll take each opportunity in turn. Today, when you look at the MVNO market, the mobile market, typically, there are two or three very large brands that are in the MVNO market, and we have a very low market share in this. We had previous MVNOs like Lebara that would have been on the Vodafone business that were acquired in 2016 and became a direct entry. We know how to do MVNO, and we've got platforms.
Some of the key enablers that we're bringing to market to let us be more successful, firstly, there's a platform called MVNE or Mobile Virtual Network Enablement, and this allows us to extend the reach. Instead of you needing to be an MVNO with many hundreds of thousands of subscribers, which means, one, it's difficult to get the funding to launch a new MVNO, and two, you need to have a very large base to bear the fixed costs of doing it. We're launching a new platform in H2 this year, which will allow us to do mobile virtual network operator enablement. What that will mean is it's a much lower cost, simpler platform where most of the IT functions are already done and pre-integrated.
If you're a brand with maybe 10,000 customers or 20,000 customers, you can suddenly move into telco and you can start to deploy mobile services. If you look at NBN as a good parallel, NBN has many hundreds of RSPs. There's a fantastic opportunity for RSPs that already play in telco or indeed brands that might be in retail or in banking or financial services or even food that wish to move in to creating their own mobile services as part of their overall lifestyle packages. It's a really big opportunity that comes to us there. Alongside that, we also have the capability where we'll offer 5G to those MVNO players. I think a really positive, important step for that wholesale mobile market.
Secondly, in the fixed data market, so the traditional fiber market, using our assets that we just talked about in the metropolitan area, we take those to market, and currently, we take about 16% market share in that market. Again, we see a really strong opportunity to grow in two dimensions. The first one is winning more customers in already connected buildings. Of that, 13,500 buildings that I mentioned are already connected. We make all of the services available to not just the enterprise and government market, but to the wholesale market too, opening up this wide range of over 500 channel partners that we have that can take those services to market and further extend our reach. We also then selectively build, so we invest into building those fiber assets where it makes economic sense and where there's good opportunities.
We see a real ambition to take more share of that fixed data market. The third one is in the residential segment. We have three assets today, which I'll explain in a little bit more detail, which have residential superfast broadband networks, some that are fiber all the way to the premises, some that are fiber to the basement of the buildings, and then some that are powered over hybrid coaxial networks or VDSL networks. Now, we've traditionally had those assets for sale in our own business. Typically, they've been part of the TPG-branded proposition, and we've done really great things as a company to scale that up. Now with all of those moving into a wholesale market where we can sell to the rest of the market, we see an opportunity to increase penetration.
We currently have about 34% penetration of those assets on the number of homes connected and buying a subscription versus the number of premises passed. Really strong opportunity by bringing that to wholesale to further expand that number. I'll talk a little bit about those networks to give you some more insight. Those three wholesale residential access networks, you can see on the diagram here. These pass over 400,000 premises and have a great opportunity using different technologies to offer customers a high-quality broadband service. On the very far right, we have buildings that are directly fiber, and that means fiber to the premise and then fiber inside the building, so you're getting a full fiber experience.
We have what's known as the fiber to the building, where the fiber runs up to the building, and then inside of it there's the traditional copper wiring. Recently, we announced an upgrade of that network to give the fastest possible speeds on that network, almost up to 1 gigabit per second download on that network, and that's a technology called G.fast, which we invested in and built. We've now got over 2,000 connected buildings, approximately just over 200,000 connected passed premises that we can connect to those G.fast services. This is a really competitive product that's far faster than anything in the market that we think is a real opportunity for other retailers to take to market and sell, especially where the choice is either NBN or nothing in a lot of those areas.
What you see is the orange lines, our VDSL and HFC networks, and we're also upgrading that VDSL network to be able to offer over time G.fast services as well. We'll see really strong improvements of those networks and a great opportunity in wholesale to address additional customers. The functional separation that I mentioned comes into effect on the seventh of October, and what that means is it allows us, not only to sell these services through wholesale to other companies, but it also gives us optionality around investing in further building these networks. Historically, we were unable to build those superfast broadband networks from the point at which they previously stood. However, now we'll get the opportunity to extend them and to reach into many other markets.
For example, in wholesale, when we look at those residential access networks, we can see a range of different growth opportunities. Firstly, by opening up those networks to the wholesale market, we can acquire new customers. We'll differentiate with speed, we'll leverage G.fast, and we'll use this to go after new customers that we can bring onto the business. Secondly, we can go after new verticals. We can go after playing a role in, developers or other communities, and we can do that alongside launching potentially new wholesale products, last mile fiber products, or even how we might address smart cities or some of the new use cases that are requiring, additional connectivity. Finally, we can also look to expand that network to move into different locations, working in partnership with developers or indeed existing brownfield developments.
It gives us real optionality now that we have the functional separation in place. That's enterprise, government, and wholesale. I'd like to take a moment to recognize the outstanding team that we're building across enterprise, government, and wholesale. It's a leadership team that brings diversity in experience, diversity in opinion, diversity in go to market, but also has real breadth and depth across telco, ICT, and the relevant operational sectors that we want to be in. Some of the team are in the room today. I can see Chris Russo, who runs sales and solutions, is here, and Jeremy Howe, who runs commercial, which includes product and marketing, and Justin Middleton, who runs our wholesale and carrier business. If you'd like to find out a little bit more, feel free to grab them over the coffee break. I'm super energized about the opportunity in enterprise.
Really pleased to get a chance to talk to you all today. My only closing act is to announce a 15-minute coffee break. Grab some refreshments and we'll see you all back. I was asked specifically to tell you, please don't run out of the room. Don't try and jump on the ship outside. Stay here. We'll be back in 15 minutes for part two. Thanks, everyone.
Hello, everyone. Welcome back after the break. I feel a bit unlucky because Jonathan was the one who gave you the great news there was a break coming, and I'm the one now telling you finish the break, finish eating, and just sit down. My name is Ana Bordeianu, and I'm in charge of customer operations. Together with Giovanni Chiarelli, our Chief Technology Officer, we will take you through about 30 minutes of more information and more insight around our priorities to drive better customer experience, to drive more IT integration and respectively some new interesting developments on the 5G and the network side. In my part of the presentation for the first 15 minutes, I actually thought about this time slot.
To tell you the truth, I felt a bit nervous. Nervous not because of your, I don't know, your positions in your organizations and who do you represent, but more nervous because I imagine some of you are customers of our brands. I thought, oh my god, I'm going to go there on the stage and talk about customer care platforms and talk about customer experience. I imagine there are people in this room who may have had very, my colleague friend told me I'm not allowed to use bad words, so I will say a very unpleasant experiences with us. As I imagine there are also some of you who may have had very good experiences with us.
I actually had the pleasure early this morning with one of you to share with me that you actually had a very good experience with our TPG brand at some point when you needed support from our contact centers. I thought, okay, I may be nervous, and I may hear from you unpleasant feedback about how you managed to work your relationship with us. In reality, what I want to tell you is that we do have a very good framework of work to identify opportunities for improvement. Second of all, we are a lot focused on simplification, consolidation, and really stepping up the experience for our customers.
Third of all, to give you confidence in the consolidated team that is managing all this and leading the division and the projects in our organizational customer operations. This is the agenda that I told you about, and I will start by discussing a bit about the framework. You've heard Kieren and you've heard Jonathan mention the commercial priorities. You've heard them talk about cross-selling, for example, as a crucial priority for both the enterprise division and the consumer division. In reality, to be able to do cross-selling, we need to really know our customers well for each brand and potentially between the brands.
The reality of our business today, as some of you probably imagine, is that we are a business that has merged together, but in reality, many of the brands are vertically managed with vertical infrastructures. That brings complexity into the business. Commercially, it makes sense, but from a management of the business behind the scenes, it actually brings a lot of complexity. You see here information about the number of systems as a ballpark, and Giovanni will also give you a bit more details on that.
We operate in an environment that is really complex, and we see a lot of value in actually driving a better customer experience and more operational efficiencies for our customers and for our shareholders to bring together those platforms into platforms that are more scalable, that can give us flexibility from a commercial and marketing perspective, so that we can come across into the market under different brand identities. Behind the scenes in our organization, to make things easier for our frontlines and as well for our customers to do business with us. We start from the customer journey. That's another big topic for us, immersing ourselves in understanding for each brand, what is the real customer journeys? What are the pain points?
Which are the steps in a customer journey where we create friction, where we have the most opportunity for improvement? We try to connect that insight and that customer feedback to the commercial priorities that Kieren and Jonathan have talked about. It's basically an integrated cross-functional work that we are doing, trying to connect all the dots that we have, all the insights from our customers and from our business, in order for us to identify which are the areas that we want to focus on to deliver a better customer experience.
In the presentation today, I will give you two examples of such projects that we've identified will make a difference, not only from a customer experience perspective, uplifting it, but also from an operational efficiency perspective, to allow us to drive a better cost to serve and to do a more efficient business for our customers. One of that is the contact center platform integration. It's probably not, I don't know, unheard of, that having multiple brands that have grown into this new merged business during time. We have, as I was telling you, multiple IT infrastructure supporting them. We currently manage three different contact center platforms supporting different brands, which is a lot of fragmentation.
At the same time, these platforms have a very, I don't know, aged capabilities not allowing for a great flexibility for us to be able to manage between different contact centers, to be able to manage a self-service options, maybe cooler, better opportunities for our customers when they need our support. For example, to get a call back at some point. For us internally, to be able to manage between inbound and outbound interactions to support the commercial ambitions, for example, for cross-selling. How do we manage that today is very fragmented and very verticalized. We've identified Genesys Cloud as a future-proof partner with a platform that has state-of-the-art capabilities to help us drive a better customer experience across all brands, and by the way, across all segments.
For example, when Jonathan was talking about building the telesales channel, the telesales channel is a channel that will be using this platform and will allow, therefore, a lot of flexibility and efficiency for both agents and a really good experience for our customers. This platform in itself that we've started working on and we already have the Vodafone brand enrolled on it, TPG and iiNet are under work and everything will be finished in the first part of 2023. In this way, we'll have basically vast majority of our customers experiencing it. The customers will have flexibility between, for example, using web chat and using a voice interaction.
Asynchronous chatting with our agents, which we know, for example, is a very good experience and highly appreciated by our customers. We really believe that this is a foundational piece of work and one of the examples of how we are looking at duplicated systems or triplicated systems, you know, in this case, and finding the best solution possible to create a future-proof business and to give us flexibility and scalability in the way we manage our brands and respectively our customers. Another example is touching a crucial step of the customer journey. A crucial step that is the billing step. It refers to the fact that currently in our business, we have four different payment gateways.
That means that across different brands, our customers experience very different payment methods. For us as a business behind the scenes, we have to manage very different processes, which actually brings a lot of complexity, duplication of resources, as well. In reality, also the payment methods in themselves are not necessarily up to speed with the level of innovation that exists in this industry. We know that this is a crucial step for the customer experience. We have listened to the feedback of our customers, who are telling us, for example, other industries are giving me options to buy now, pay later. I can't do this with telco, with your brands. Or, the payments are not necessarily real time for some brands.
It is a reality of the business that we are in. We are working on implementing Braintree as a strategic partner into our IT infrastructure to be our unique payment, our single payment gateway across all brands, bringing us state-of-the-art payment methods. Some of them being unique, I would say, in the telecommunications market here. Also giving us a future-proofing us in this respect, because we will get access with this platform to any new developments in when it comes to payments. In this way, we create a reduced complexity in our business from a technical perspective.
Giovanni's team, for example, will have to manage a single payment gateway, and not necessarily four, as we have today. We'll create a better experience for our customers with new methods of payment and real-time payments, and less operating costs for us. Again, this is another example of how we are doing things, and it's an example of a bigger plan that we have to consolidate, to simplify, to drive more operational efficiency and therefore better experience for our customers. As I was saying in the very beginning, this is all underpinned by a really excellent team. A team that we put together, as I think Iñaki mentioned in the beginning of today's presentation.
We've worked end of last year and beginning of this year to streamline the organizational structure, to bring brands together, to bring the activities together, and to make sure that we eliminate duplication and we create accountability in roles across the multiple brands. This is a team that is supporting me in delivering on our ambitions on customer operations and customer experience. We have here, in the room, Virginia, who is in charge of customer care across all brands. Please, after this, if you have feedback, just go and talk to her about customer care. She's always happy to hear.
We have Tarun as well, who is in charge of everything credit collection, logistics and all the, let's say, more the backend processes that are happening in our business to support our segments. Gerard, who is in charge of everything go-to-market and is more of the internal engine of the operations connecting us to IT and to the rest of the business. Erwin, who is based in Philippines and is managing for us the shared services that we have there. It is an integrated structure of solid, experienced general managers, very passionate, very knowledgeable on their fields, and I would say that very commercial in themselves. With this team, I feel very confident that we can connect very well to the rest of the organization and align our priorities. I will now hand over to Giovanni to take you through cool stuff on the technology side. Thank you very much.
Thank you, Ana. Good morning, everybody. My name is Giovanni Chiarelli. I'm the Chief Technology Officer for TPG Telecom. It's great to be with you today, and I need to play the role of the cool guy, so let me see if I'm good enough on that. First of all, I will move on stage like the big gurus that we know about. Jokes aside, Ana Bordeianu has already introduced to you the way in which we are simplifying the customer journey.
Now my role is to share with you how the IT architecture can enable all of this. We have a great opportunity. Ana Bordeianu already mentioned that today we have more than 600 systems in the IT architecture, and we can really simplify this number to less than 400 in the range of 3 years. This will be done through the implementation of a new digital stack based on best-in-class technologies.
This is not the only step that we are taking, yeah. We are adopting a cloud first approach, which means we are migrating more than 60% of our workload into the public cloud. At the same time, we still rely on a strong foundation in terms of technology centers, with the full integration of data centers and switching centers coming from IT and the different domains of the network, where again, we are going through a simplification and consolidation in order to achieve better efficiency and effectiveness. In essence, the main objective of the IT will be, on one side, to deliver a better customer experience through simplified journeys. On the other side, to provide new digital capabilities to our customers. Last but not least, also to provide to the internal teams advanced analytics.
Now, a second crucial element in the equation of a better customer experience is a better network. Here you can see on the slide our two-pronged approach in terms of mobile network, yeah. We will continue investing in the metro areas in our 5G rollout and in the modernization of the mobile network. Today, we have already deployed 5G on 1,300 sites, and by the end of the year, we'll pass the mark of 2,000 sites. This is equivalent to 95% population coverage in the top 12 urban areas of the country. We will continue with the same pace, so in 2023 and 2024 to conclude the rollout in 2025 with a complete 5G national coverage. A second crucial aspect of the journey and of the strategy is the landmark network sharing agreement for regional Australia.
This is done through the implementation of the multi-operator core network standard in terms of network sharing, well known in the industry, which is creating a seamless transition between the different areas in terms of coverage for our customers. For the first time, 4 million of consumers and businesses in regional Australia will have a real choice and better value. This is also a greater experience for our customers that traveling from the urban areas into the regional areas as well. As you know, this is subject to the ACCC approval. However, the 5G rollout is not just heavy lifting. I want to share with you also the fact that we have introduced significant innovation in this approach.
On one side, there is a completely innovative way to preassemble and test all the active equipment that are part of the 5G rollout, and we are doing it on the ground. This is greatly beneficial because it's reducing significantly the cost of intervention, the time of intervention, and more important, is reducing the disruption on site, which again, means better customer experience while we are rolling out 5G. The second great innovation is regarding vice versa the core network, so you could say the brain of the network itself. We have launched at the end of last year, the 5G standalone core network. This is absolutely the first in Australia, but we could say one of the first in the world.
A super modern network and architecture, which is capable to provide better 5G coverage, more efficient optimization of the 5G capacity, and also very, very important, is the first step to deliver the 5G most advanced use cases, which require ultra-reliable, low latency network. This is about our 5G rollout. I want also to share with you a more integrated view of the network infrastructure because it's not just mobile, but is a compounded view of different layers. Talking about spectrum, since the merger, we have strengthened our portfolio, but at the same time, we have been able to avoid costs for more than AUD 500 million, thanks to a very, very rigorous approach in terms of asset management and asset acquisition in the spectrum environment.
We will continue with the same, by the way, in the coming years. All of this is feeding into the mobile network, so approximately 5,000 sites, out of which more than 85% with fiber backhauling, which is obviously crucial in terms of 5G rollout and the ultra speed that it has to provide. This footprint will be progressively enriched with additional approximately 700 sites in the course of the next ten years, again, mostly focused in the major metro and in the large regional centers. Metro fiber, another great asset, more than 10,000 kilometers of fiber, mostly deployed in urban areas, corresponding to more than 20,000 sites and 450 points of interest for enterprise-grade services. Very, very clear approach, and we want to maximize the potential where is possible, migrating customers on our network.
To conclude with the Intercapital transport network, more than 31,000 kilometers of fiber across Australia, and by the way, a recently upgraded submarine cable system to connect Sydney to Guam in order to transport international traffic and getting access to the big Internet. This is from an infrastructure perspective, the way in which we integrate all the dots. I want to conclude presenting my team, a newly born organization. For the first time, we have a single technology function inside the company integrating mobile network, fixed network, and information technology and digital. You can see we have six roles and five general manager and executive managers that are covering them. Starting from Mandie de Ville, she's in charge of IT and digital, a function that is fully focused on the application and integration layer.
Bill Fowler is the General Manager for Demand and PMO, but is currently acting also in the technology security position. We are elevating technology security because clearly there is a significant need from this perspective across all the other domains. Fiona Jolly is leading the technology service operations. Designing the new organization, we have been very, very deliberate in merging together all the network operation centers and the IT support centers that previously were fragmented, is again giving a better support to our customers through our colleagues that are in front of the customers themselves. To continue with two colleagues that are today with us in the room.
Barry Kezik is the Executive General Manager in charge of network and infrastructure, a fully integrated organization that is looking at mobile network, fixed network, core network, and all the technology centers across the country. To conclude with Yago Lopez, that is in charge of technology, strategy, and innovation. Again, a new function that is looking at the mid and long term in terms of innovative technologies and the strategies that is supporting that. In essence, we will significantly simplify our IT architecture to support better and streamline customer journeys.
We'll continue to focus on the 5G rollout in metro areas, and we will take advantage of the network sharing agreement in regional Australia to give more opportunities and choice to 4 million Australians in those areas. Last but not least, we'll continue to be very, very disciplined in terms of asset management for our network infrastructure. That's all from my side. Now I leave the mic to Grant, who will introduce to you our capital allocation framework. Thank you.
Thank you. Well, I'm gonna start with two apologies. First of all, I along with Kieren are gonna bring back the boring Australian accent. It's a very difficult executive team to have a proper discussion about the right football code, I can tell you. The second apology is you've been listening all day to wonderful business strategies, good innovation, very sparse, wonderful charts. I'm about to bring you back down to financial frameworks and accounting reconciliations. I'll try and go as fast as I can. A few dense, well-worded lots of numbers on slides just to build on that CFO stereotype a little bit more.
Today, I think, you know, really, I'm sort of five months into my job, to almost five months into my job, and I've really had a pleasure of probably meeting a fair portion of you over the last few months. Every so often, I exaggerate how many investor meetings I've done, but it's not quite at 100 yet in that exaggeration, but it's a fair amount. I've appreciated getting out and speaking to both debt and equity investors. What one area that we did talk about coming back to was sort of our capital and how we use capital, in particular with talking to the CapEx that we announced earlier in the year. Really, we've taken an opportunity to talk through capital allocation framework that we have.
We've taken an opportunity in the appendices. I'm not gonna talk to them to provide sort of just more detailed financial disclosures from reconciliations. You're more than welcome to ask Bruce and James, as you see them, for any information on that as we move through. In terms of the capital allocation, I'll start. There's nothing revolutionary in this capital allocation framework. It's largely similar to what you see in most companies, mature companies of our size. I'll go through the framework briefly on this page, and then I really just unpack them on the following pages as we work through.
You know, on the left-hand side, really we're talking about sort of our annual commitments we make out of the cash flow that we earn in terms of where we allocate that capital. You know, really it's the priorities that we have on an annual basis to maintain our assets, to maintain the world-class assets that Giovanni's just talked about, and to also maintain a really strong balance sheet, which I'll talk about. Of course, to share some of that cash flow with our shareholders, we've committed to a dividend policy of 50% of our adjusted net profit.
On the right-hand side, that's where we have the choice, and we choose both on an annual basis and sometimes multi-year basis in terms of really where we invest any capital or any cash flow that we get out of the operations, and to create value. It's both investing and releasing capital, which we'll also talk about to create value. Finally, obviously, you know, returns to shareholders become really important over that time. I'll go through on the following pages some of the more details on that. We're starting off with sort of the CapEx profile, and a bit of a snapshot. The totals are not new. This is what we talked about at the full-year results, but obviously we didn't provide the breakdown, which we are providing today.
They're round numbers. You know, the round numbers are estimates, and we will plan every period now to update sort of the outlook for the current year that we're in and also provide the actual numbers. I think we can keep to work that through. When we work through it, I'll start at the bottom. The obvious thing we do every year is, as I talked about, really we're calling the run CapEx. You might call it stay in business CapEx. It really is about investing and sustaining the assets that we have, you know, maintenance on the existing network, some of the IT infrastructure.
You know, from that point of view, the big focus of the business, and we'll talk about simplification, you've heard about that today, is to try and evolve that down over time to make that really efficient. Certainly, as we grow the business, we wanna have a platform such that CapEx doesn't need to grow as a percentage of activity. There's a big focus on, as we simplify the business, to try and reduce our sustaining CapEx. If I move to the top part, which is the sort of growing CapEx, that's things where we've talked with, in particular, Jonathan's talked about today, where we're supporting our customers with, you know, selective fiber build-outs with things like G.fast in the residential access network.
Those things and as you see, as with this fairly sparse capital allocation, it has to have pretty good paybacks to get kicked off. That's a very good discipline within the business. These paybacks are strong, they're identifiable, and they're usually pretty quick. The transformation one in the middle, which is where we are quite elevated right now, as we called out early, you know, which is obviously the biggest one as Giovanni just pointed out, is the RAN upgrade to 5G. It's both elevated because we're doing it. It's elevated because of swap out of the Huawei equipment, which came out of government requirements. It will be elevated for the next few years. These are choices in terms of accelerating it. I think we explained this at the full-year results.
The acceleration has benefits. You know, we'll get to the 5G readiness. We wanna be there at the same time that Telstra says they're gonna get to their regional network, which we'll be a part of, so that we're really 5G everywhere, which will give us a competitive advantage at that time. It has elements of both run and growth. I mean, as you know, we need to keep our technology up to speed, so we need to do these transformational activities. There are returns. You've all heard of the fancy term Giganomics. There are returns in terms of using spectrum more efficiently with the latest equipment on 5G, you know, in terms of the cost to deliver data.
There are growth opportunities in terms of both enterprise, potentially on the consumer side in terms of what consumers will pay for. It has a mixture of both. They tend to be longer term than the growth CapEx, and a little less identifiable upfront, which is why it has its own sort of network. Over a 10-year period, obviously we've talked, this is gonna be elevated through to the middle of the decade, where the 5G rollout will slow. I think, you know, over a 10-year period, you probably get an average of less than half of that kind of number that we're currently spending. It is lumpy. It is hard to estimate, but that's how we're looking at our sort of buckets of CapEx.
Turning to the balance sheet, again, I think there's a couple of elements to this. On the left-hand side, we've really just focused on the bank debt that we currently have, which is obviously gonna reduce by AUD 890 million when we close the sale of the towers in July. That'll create about AUD 3.3 billion headroom. As a CFO, I'm very comfortable with our covenant structure, obviously, which first maturity is 2024, next one is 2026. From a bank debt point of view, very, very comfortable position, in terms of, in particular after we get the proceeds from the asset. We called out at the merger that we were targeting sort of an investment grade.
We're not rated, but an investment grade profile. That hasn't changed. What we're showing here, probably conservatively, on the right-hand side is just adding back the lease liabilities that we have, to get sort of a pro forma net debt position, which is comfortably within what a notional investment grade range would be. This is all based on sort of 2021 pro formas. We haven't added the benefits of organic growth which we'll have this year, nor any of the MOCN deal. It's a conservative view, which basically says you know, we're very comfortable with our balance sheet positioning, where we are.
We have noted in the footnote that we do have, you know, approximately AUD 700 million of off-balance sheet financing just on handset financing that we do sell after we incur it. I think really our focus on the balance sheet has actually been more about, we'll talk about asset portfolio in a second, but the sort of liability mix. One of the big benefits of the tower sale was really about switching from the sort of bank debt, which is obviously relatively short-term, floating interest rate type structures into long-term, you know, at our option, up to 35-year money, matching the asset cycle that we have.
You know, to have very good long lease debt matching assets that we know we're still gonna be using in 30-35 years, you know, we've moved up to about 40% as the lease-to-bank debt ratio. That's a very good mix for us. We're working through the course of this year in terms of the bank debt that's left, what's the right optimal mix in terms of capital markets, tenor, volume. We'll come back to the market on that as we work through it. The other element of our framework is sort of the dividend policy. Again, nothing new here necessarily, nothing changed. Obviously, it's subject to the board, but our policy is to pay out 50% of adjusted Net PAT.
We start off at sort of statutory Net PAT as you should. We've called out that this year you're gonna see obviously a big profit on sale from the tower assets. You may see some costs coming through on that as well and potentially costs ahead of the network sharing agreement. That there'll be some one-offs, some call-outs that we'll have through the year that we'll probably adjust for under the restructuring costs. From there, we do take off some amortization costs to get to the. You know, what we're trying to do with this, it's not a perfect way of adjusting, but we're trying to get to a reflection of the underlying cash profit that's recurring each year and pay 50% of that out to shareholders.
Now the other 50% covers the sustaining and gross CapEx profiles that we've talked about. Obviously we also are adjusting for any restructuring cost that we believe will generate future benefits that are just one-off costs for the year. We don't want that to come off the dividend profile. We've called out in the first half of this year for the final bit of getting that AUD 125 million-AUD 150 million synergies. We've spent about AUD 35 million in the first half, largely around people costs and simplification costs in terms of some of the things you've heard about. We've merged a lot of the wholesale and enterprise and government together.
We've merged IT and networks together, and completely tried to simplify the business from the front end. That's also moved through to simplifying the organization structure. We'll adjust for those as well. I think it's important. I know in previous years we've had other terms called underlying profits and a few other things. We're gonna try and stick to just this one. This may evolve over time in terms of how we measure it, but we'll have one thing to model, and look to pay 50% of that out each year. When we move on to sort of the optimizing and unlocking value, we're always looking at our portfolio. I think we've got a few examples we can point to that we've done over the last few years, which are important.
I mean, the biggest example of this when people talk about rational sort of use of assets is actually the merger itself. You know, either company could have or in fact TPG, the old TPG started to build infrastructure in different areas to compete. You know, the benefit of bringing a fixed a fixed network with a mobile network, you've heard today in terms of the synergies we get, the cross-sell ability, and the convergence opportunity both for consumer and enterprise. It is a really great, probably the best example of really rational use of capital to provide a sort of third player and a third integrated player.
Obviously this year we've announced the monetization of the passive infrastructure I just talked about, which again is all about better financing our use of those assets. Of course, the regional MOCN deal you've talked about again, which has both strategic benefits, it has financial benefits, and again, it's also extraordinarily rational in terms of how we allocate capital and where we allocate it to. Instead of allocating it into trying to build an uneconomic network in the regions, we can allocate that elsewhere. Ongoing, we sort of have four broad categories we're constantly reviewing.
You know, we're continuing to look at how we drive value out of those infrastructure sharing things we've done, both with Telstra. We also have a joint venture with Optus in the metro regions that has opportunities to continue to drive better returns. We're continually assessing sort of core and non-core assets. We get a lot of questions around our fiber assets. We continue to look at those. You know, the way we'll probably define core and non-core is whether we are investing in it, whether we are growing it, whether we are monetizing it properly. If the answer is yes to all of those, it's a core asset that we'll keep.
If the answer is no to those, it's probably an asset we'll look to see if someone else can monetize it better than us. That continues to look through it. We are looking at smart ways of adding in partnerships, maybe small acquisitions as well, and particularly on the enterprise side, you know, just to make sure we continue to enhance our core assets and differentiate the technologies. Then obviously, I've just talked about balance sheet optimization in terms of financing structures and making sure we've got the right debt. We're constantly looking at the portfolio. It requires discipline, it requires prioritization 'cause there's always more good ideas than there is capital the CFO wants to give. That's something we work through.
I think we've exhibited over the last couple of years the ability to make rational decisions around that capital. You know, the residential access network, you've heard it today is sort of standing up from October when we get that wholesale thing through. There are lots of opportunities that don't require capital or at least small amounts of capital. We've already invested in G.fast. There may be other things that require capital that you know, we'll either have to look at in terms of where that fits versus the growth CapEx, whether there's third-party capital. It's a very Uniti business. It's a very hot space right now.
There might be other ways of getting capital, or other ways to grow that business, for example, and we'll look at that in the context of our capital allocation framework. That sort of finishes the tour of capital allocation. I think I was just gonna leave. There's nothing new again in the sort of financial impacts for 2022, but it's probably just a summary. In the appendices, as I say, there's a whole lot of sort of more detailed, improved disclosures we hope will help with the models for the investors. Again, feel free please to ask James and Bruce any questions you have on that. As we move down on the operating earnings, again, this is just what you've heard today is continuing what we've said to investors before.
This positive momentum is really strong in the business. We've put some targets out there in enterprise and government. We're excited about unlocking the value in wholesale, which we probably haven't talked as much about, and you heard that today. In terms of the synergy and restructuring, you know, to pull forward, we often say to pull forward the AUD 125-AUD 150. I can't take credit for it. It's already happened before I came. It's a pretty great effort to achieve that a year early through COVID, where nobody was in the office. It's a really full effort that we will achieve that this year. As I say, there's some one-off costs to achieve that in the first half, which we've incurred.
You've also heard a lot of opportunities. I think there are further opportunities for simplification. You've heard the high-level opportunities from Giovanni and Ana in particular. I think we've already achieved a lot of the cultural simplification and the front-end simplification and the people simplification. It's a bit like a duck underneath. There's a whole lot of complexity that we have an opportunity to really face into, and we're facing into those opportunities, as Giovanni and Ana pointed out. We'll probably come back in another investor day when I think we've worked through what the benefits. There's lots of benefits to the simplification. Probably more about the scaling to support the growth opportunities you've heard.
We need to probably be more simple and invest in a simplified structure to be able to grow and reach our growth ambitions. Regional network really we've just reiterated the accounting impacts there, and some of the economic opportunity. It's a bit of a no-brainer in terms of the break-even analysis of getting the subs. We've heard that from Kieren today in terms of even just churn reduction. I think sort of pays for the economic opportunity. There is a really exciting opportunity for us to execute to create value over time from that deal. The tower asset sale, again, we've just really put in here some of the accounting impacts that we've already announced. As I said, the economic benefit really that is matching the assets and liabilities.
Doing that in an environment where inflation and interest rates are going up to have a long-term lease, that's relatively fixed finance is very good for us. I'll finish like all the teams have with our people. These are actually my direct reports. The finance leadership team, it consists of 12 people, which includes sort of business partners, tax and data analysis, which Sean kindly looks after. This is a good team of a diverse mix again of sort of 3 of us are new to the team. That brings a different perspective, but it's embedded in here is some really deep knowledge of telco, how the businesses work, how the finance work.
I will make a special call out to Sean, who I'm still with here, who's you know was the acting CFO before I started. He's been with us a long time. He's been a great support to me as I've joined, continues to basically run the teams internally really strongly. It's been a great help to me and to the teams. All of them are really experts in their fields and are excited about the opportunity to support the business. With that, I'm gonna hand back to Iñaki to lift the mood back up from the finance and accounting allocations and before we get into Q&A.
Well, thank you very much. Look, I don't think I'm going to talk. I think you probably have a lot of questions. I have seen all of you writing the summary of the morning already, so I'm not going to repeat that. Just a couple of things. Look, we have shared with you our ambition. Our ambition to create the best telco is a focused ambition, but it's also the time for us to do that. We've grown the business across technology, across geography. That gives us a unique opportunity to really expand our addressable market. I think that is really something that in the context of a market that has been normalized, that we see much more mature, much more focused on recovering. I think we can take that opportunity very well in this company. We're doing that at the same time that we concentrate on simplifying the business.
Working not just simplification around reducing costs, which we are doing, but also simplification around creating a very scalable platform. A very scalable platform to serve our customers and to manage our technologies in the most efficient way. I think that, you know, listening from Ana, from Giovanni, some of the projects that we have around there is a great opportunity, but is really something that is going to make us much more capable in this market. Then ultimately talking about our financial discipline, the rigor, the, you know, the way of looking at things from a business perspective, whether we are investing in technology or in a system.
I mean, we're really looking to the way that we are using our shareholders' money, but also the way we are maintaining this value advantage versus competitors that are probably much more distracted in the market. This is a bit the summary. I'm super excited that you guys have the opportunity to meet the people that make all this happen. I'm going to welcome a lot of questions now, and they are going to be taking all the answers. I may take a couple. Before that, today, while we were all here, we launched in the ASX a notice of the escrow which expires on the thirteenth of July. We do that because we are obliged to do it at least five days before the escrow expire.
We have also added a lot of information around how it works, and also information around the different positions. I say this because, that way we can save ourselves time asking questions about what shareholders are going to do. That is a question for shareholders. They are really the ones that have to decide, what they do with the shares. Everything else around the escrow is at your disposal on the ASX. Thank you so much. I'm going to invite all the team now to come up here. We're going to sit down in all these chairs, and I think that James is going to help us to arrange the questions. Perfect.
Before we go to the room, which we will very shortly, I just wanted to sort of bring Trent and Ness into the room, into the discussion. Trent, our Group Executive for Legal and External Affairs, and Ness, our Group Executive for People Experience. Trent, I know everyone wants to know about the MOCN. Everyone wants to know about the progress with the MOCN. A few people might have seen there's been a bit of press coverage about the MOCN. Maybe you could give everyone an update on the process with the ACCC and the broader regulatory process.
Thank you, James. Sure. Obviously it is in a regulatory process at the moment with the ACCC, so there's only a certain amount that I should probably talk about. I'll talk about the public, what is public. The public consultation phase is happening now. The ACCC has set a target date of a final decision by 17 October. With an interim decision, I think, in the August timeframe. We'll have a very good indication from the ACCC in that period. The public submissions are overwhelmingly in support at the moment. If you go have a look at the ACCC merger register, you'll see it there. Of course, that's our view as well, that this is a very pro-competitive agreement, which will bring significant public benefits as well.
Just briefly, we've touched on them a lot today, but just to summarize again, I guess, the view that we take as an organization is that this brings into regional Australia a third player, really for the first time, where we can, through that 98.8% coverage that will be achieved with the MOCN agreement, we will now have a network that will satisfy both the customers in Metro that wanna travel to regional Australia and of course, the more than 4 million people that live in regional Australia. It also brings great benefits in TPG's spectrum being utilized in regional Australia really for the first time in a big way. On the 3,700 Telstra sites, we will be able to use our either unused or underutilized spectrum, and that's a huge public benefit.
Equally for the many people out in regional Australia who utilize the Telstra network today, which will be us and their customers, they will all get the benefit of that spectrum. Also, the Telstra network is somewhat underutilized in some areas, of course, where there's not much population that will be more utilized. Particularly the public-funded sites that we've all had a part in paying for will now get utilized by a second party, being TPG. There are really significant public benefits, and that's an important part of the ACCC's process to assess that. We're very confident that the process is running well. It's running as expected, and we're positive about where the outcome will go.
Thank you, Trent. Ness, maybe we'll just touch on culture. Whenever we have gone round or when we went round pre the AGM and met with a number of the people in this room and also others, how the culture of the organization is developing is a very common question. We haven't presented on it today 'cause we only had so much time, but maybe you could just touch on that for us before we go to Q&A in the room.
Hi, everyone. Thank you, James, for the question. So let me start by saying, look, I'm immensely proud of the progress that we've made on culture in the two years since we've merged. This journey started, you know, as I said, two years ago. The way we started the journey was spending a lot of time understanding the cultures in the business. It was really important to do that to understand what was there in the organizations, what was strong about those cultures, what enabled performance, and also what are the things that hindered them, and also what was similar and what was different. We spent a lot of time listening to employees and spending time with employees.
Now this was during a time when we were in the depths of the pandemic. It was a challenging period, shall I say, to focus on culture. We actually used that to our advantage because we were able to engage employees all across Australia, and we've got a very diverse workforce, including our workforce in Manila, and engaged everyone in a way where they were on an even playing field. Everyone was engaged in the workshops that we were having and talking about culture on a screen. Everyone felt completely the same and could engage in the same way as we started to talk about the culture that we wanted to build. Through this work, we did a lot of listening.
We developed a deep understanding and a lot of insights, and then started to think about what was the culture that was gonna be right for TPG Telecom. That culture needed to be respectful of the past, but also a culture that felt new to everyone, and was reflective of the new organization that we were building together. We built our culture aspirations. We developed our four values, which Iñaki mentioned, stand together, own it, simple is better, and boldly go. We refer to our culture and our values together as the spirit, so it's the spirit of TPG, and that's what we talk about in the business more so than culture and values. We talk about spirit.
In terms of how we measure it, 'cause obviously we need to measure it to know how we're progressing, we have a biannual employee survey, so all of our employees participate in that survey, and that's how we measure it. We have 16 questions specifically from that survey that measures spirit, and we also have those questions form our spirit index as part of our STI, our short-term incentive plan. It's very important for us that we are making progress on that.
Last year, we set our benchmark for it, so we started at 72% and then finished the year at 76%, which was a great achievement, as a newly merged organization, also doing it in a time where, you know, we couldn't bring a lot of people together. We continue to focus on this. We have an unrelenting focus on culture and on spirit in the organization, and it's through this that we believe we'll become the best telco for our customers and for our employees.
Thanks, Ness. Okay. We will be going to questions in the room. I know there are some of you online who are asking questions as well, but we will be prioritizing questions in the room. When you get the mic, could I ask you please to state your name and institution? It's just very helpful for us for the record-keeping and the transcript. I think we're starting over there. Yep.
It's Tom Beadle here from UBS. I've got three questions.
Yes.
I might just ask them one by one, if that's possible, please. Just firstly, on consumer, just around the Telstra network sharing agreement, I know we don't know, sorry, all the drivers there, but is that deal subject to CPI-type increases? Effectively, is it linked to Telstra's retail pricing? Overall, I guess, where I'm coming from here is, could that potentially drive the need for price increases over time just because of the terms of that agreement
I can take that question. I think that, you know, we're not disclosing the commercials of the deal. We are very comfortable with the arrangement that we had. We think that is, like we said before, extremely valuable for us, in a way that we can revert that to the customer. But other than that, we will not give details into, you know, how the commercial arrangement works.
Second question, just around fixed wireless. That 160,000 customer aspiration by the end of this year, to what extent has that been impacted by supply chain issues and your network capacity? I mean, could that have potentially been higher had you been unconstrained, firstly? Secondly, how should we be thinking about the proportion of your customers that might take these services over time once your network's upgraded and once those supply chain issues subside?
Yeah. Do you want to take that one?
Sure.
Yeah.
The supply chain issues with modem did have a real headwind for us, and we put a lot of changes. We diversified our suppliers that we worked with. We changed our terms. We took much longer purchase orders than we usually would, and we're in a much better position. It particularly slowed us on our 4G fixed wireless, but it was overall. What I would say is we're in a much better position, but I would also say is that we don't think we're out of the woods. I think anyone that's dealing with a supply chain that includes chipsets would be cavalier if they felt too confident. Although we've taken a lot of steps to bolster that supply, we stay mindful and we stay very carefully managing of that.
It has had an impact on our progress through the first half of the year, but we are in a much better rate than we are now. Could it have increased to 160? Potentially. Potentially, it could have. Again, we're looking at fixed wireless over the long term, and I think that relates to your second question, which is that we see that over the longer term, that maybe about 20% of our broadband base would be on fixed wireless.
Great. Thanks. Just third question. I know we didn't really touch on this today, but to the extent you can talk about this, just around inflation. Obviously, it's a big topic at the moment. You know, to what extent are you seeing that in your cost base, and in particular, just around wage pressures? Obviously, last week, there was that Fair Work Commission decision. So how does that impact TPG?
Yeah, thanks for the question. Look, I think that we address a little bit our situation is a bit different than the market. Of course, we, you know, there is inflation, but we are in a journey now where comparatively with the type of savings and synergies that we are delivering is not so material. We also have gone through a big simplification, and I mentioned that before, of the organization, which is also something that overall is reducing our total cost in terms of of employment.
So we see, you know, inflation as something to consider. I think that it will eventually, over time, have an impact on things like energy, which is probably the input cost that is more affected by something like inflation, and that will affect, like, other industries. We see that a bit more mid to long term. In the current situation, I think that because of the phase of our merger, that's not something that really affects us. I don't know if Grant wants to add anything on that.
Yeah. No, maybe Ness will wanna talk to the employment side. Yeah, I think the point is, look, we're not immune from inflationary pressures. Nobody is immune from them, but we're mitigated by the fact that we've taken people out of the organization. We continue to simplify over the next few years, which I think will automate more things, simplify more things. I think we've got some natural mitigations to it, you know, relative to probably if you've already done all of that, which I think our major competitors have, then everything's going to the bottom line. I think we're in a slightly better position, but there will be pressure from energy, there will be pressure from interest rates, there will be pressure from other things. I think in a relative sense, we feel relatively pretty good.
Great. Thanks, Grant. Thanks, Giovanni.
Thank you.
Down here. Thank you.
Hi, guys. It's Marcus here from Spheria Asset Management. Just a quick one on capital efficiency. Grant was talking a bit about it earlier on, but obviously CapEx at 1.05 give or take, you know, there's a bit of additional bring forward CapEx there. Can you give us some sense of where that might be in, you know, it's a crystal ball question, but like, in a couple of years' time? I mean, obviously this depends on 10,000 different things, competitive pressure, et cetera. Assuming, you know, the world evolves as you kind of broadly expect, would you see that number materially lower than that, or is it gonna stay fairly elevated for some time? Thanks.
Everything will be taken with a grain of salt as we go out to the mid decades. I think the way we've broken it up there for you is the run the business CapEx. I think what it takes to run the business as currently configured. As I sort of talked to, we're gonna try and make that more efficient. You know, whether that number comes down or whether it stays. It grows slower than revenue is the two things. We're hoping we grow the business, so we hope that it does grow, but it just grows slower. I think that's a focus of ours where and Giovanni was talking about similar simplification opportunities that will help reduce the run CapEx as a percentage.
That basically is a reasonable indication, and that will be here still in three, four, or five years' time. The growth CapEx is always a choice. Every year we make a choice, so we don't have to spend any of that. Obviously we make that choice so we can grow earnings and as we be more transparent, you know, we'll be held to account for growing that earnings, for spending that money.
The transformation one in the middle, as I said, I think probably if you look over a 10-year period, you know, we spend probably half of that on average. You know, but it's very lumpy now. This current lump we've called out will last through to the middle of the decade. Does it go to zero? Probably not zero, but then what does it go down to? It just depends on where we are in the cycle. I think if you're running long-term models, maybe it's the run CapEx, it's half the transformation CapEx, and then growth is an input. If you put that into your model, you're gonna put some growth into it.
Darren Leung from Macquarie Group. Thanks for the presentation, and I might stick with the theme of three questions. The first one is just on CapEx, so I might just follow on some of that. You know, you've mentioned that sort of accelerated CapEx section, the AUD 150 million-AUD 200 million. I mean, there was a lot of comments before around from John around, you know, the enterprise market, and there's obviously the aspiration to progress in that market a bit further. Is it fair to assume that if for whatever reason we're not as successful, that CapEx profile should drop as well? Because I imagine the bulk weight is driven by enterprise customers.
Sorry, I missed the point of the second part of the question.
Is it fair to assume that if we're unsuccessful in the enterprise market, that the accelerated CapEx portion will drop as well?
The accelerated CapEx and the transform thing is all about 5G RAN upgrade. That's across consumer and enterprise. You know, I think we're pretty committed. I mean, we can choose to slow that down if there was ever a reason to do that. But our current ambition is to get that all in by 2025. The additional growth CapEx, which largely is in the enterprise business, comes off the back of that and is complementary to the 5G upgrades, but is really different fiber for customer opportunities. No, they're not really related in that sense.
Understood. Thank you. The second question was just in relation to electricity costs. We haven't really mentioned it in the slides today, but I think it's sitting somewhere in the other cost line and not to jump straight into the appendices, but on slide 60, I think there's about AUD 85 million of admin costs in there. Any indication as to how much of that is electricity and how much of that is sitting inside fixed and variable and usage rates, please?
No, I don't think we disclose down to electricity costs. It's embedded in there. It's not a massive portion of our cost base relative to the AUD 1 billion a year we spend on network, and it's meaningful. It is obviously gonna be under pressure at some stage. Now we have some long-term contracts in electricity that'll protect us for a while. No, we're not only disclosing specific expense items.
Just the final one for me, maybe one for you, Kieren. Just in relation to inflation. A lot of those sort of offshore peers have started looking at inflation-linked plans. Obviously, a domestic peer has linked their pricing to inflation. Is that something that you would consider as well, and does it make sense for the Vodafone brand?
Thank you. First of all, we won't foreshadow anything with respect to doing pricing changes or not doing pricing changes. The only thing I'd reflect is to repeat a lot of what we were talking about earlier is that we all have the same levers in terms of our growth. We can acquire more customers, we can increase the prices those customers pay, or we can change the mix of what plans and things the customers are on.
The only reflection that I'd make is that although all of us will probably at some point pull all of those levers in a different course, for us, the first one, the addressable market opportunity, is probably more open to us than to our competitors because of the point. Don't read that as foreshadowing in any way that we will or that we won't increase prices. It's more just to say that I feel that we've got greater emphasis on more options available to us than just that one.
Thank you.
Thank you.
There you go, Fraser.
Thanks a lot. Fraser McLeish, MST Marquee. Two for me, just either for Iñaki or Kieren. On broadband prices specifically, I mean, broadband input costs have been going up for many years now. Nobody seems to really be doing much on broadband prices. Why are we not passing through more of those costs to the customer?
Yeah, maybe, Kieren, you take that one. Yeah.
We have seen different prices move in the market. We have increased some of our prices on some of our plans in some of our brands as well. There is some movement. You're right, and it talks to one of the fundamental challenges that Iñaki touched on with the NBN. We believe in the NBN as a piece of national infrastructure, but there is a part of the economics that is very challenging for us, and that's the variable cost of the CVC. As you point out, that can create a squeeze because especially during things like a pandemic, people are staying at home and using a lot more and therefore squeezing our margin. We look at different ways we can do it, both in terms of moving customers onto different plans.
We do a lot of that as a way to be able to manage our margin. We move customers onto alternative products such as fixed wireless, which bypasses the entire margin or CVC challenge. We also look at whether there are specific products and specific brands whereby we can still stay very competitive and still stay really relevant to where we think customers are seeing the value, but be able to protect and in some cases grow our margin.
Okay. Great. Thanks. One for Grant, just on the cost. I mean, it's I think you've outlined there's a good opportunity for simplification, which is great, but you've not kind of put any numbers around that, I guess. But looking over the next kind of two or three years, I mean, are those savings gonna be enough to offset, you know, other areas of investment or inflation you've got in the business and we can perhaps see the cost base flattish or even down over that period. If you just give us some sense, that would be without giving specific numbers, that'd be helpful.
Look, I probably can't give much sense other than I think we're leaning into that view now. I mean, we just sort of, you know, Giovanni and Ana sort of gave you a taste of sort of the opportunity set that looks quite real. We need to lean into sort of what does that mean? Do we wanna do it? It requires. It might require some CapEx and some OpEx investment. Where does that fit in the structure? We need to lean into that to work out what the opportunity benefits are. Intuitively, you make things more simple, you get cost benefit. You have to redo things, you have to re-talk customers. There will be some cost benefits. I think again, you'll see the theme we keep trying to get people back to is two things.
One is any cost benefits are really there to scale for growth. We actually don't want our costs to go down, to be honest. We wanna grow and our costs to stay much the same, right? That's. We feel like we've moved into with a MOCN deal with convergent strategy, which is really just at its embryonic stage. We are a growth opportunity company. We're already low cost. Again, one of the things I've said to lots of investors is, you know, both companies had a low cost mindset, probably for different reasons, but they both had a really low cost mindset, which I don't think our competitors have. Therefore I'm really glad we have because you can't get a low cost mindset. We wanna maintain that. We've got the simple mindset at the front end.
As I say, we haven't quite married that with the back end yet. That opportunity will be there. I think it will give us great opportunities to support the growth agenda we have. It will mitigate some of the cost pressures, no doubt. If you automate more things, you need less people to do things because you're more simple or by definition you are taking cost and mitigating cost pressures. But again, that's not our focus because we hope to add things in and grow the business. That's really where the mindset is. We are already low cost. We have that mindset. Efficiency is really important to us. What we need to do is make sure we become simple so we can grow.
Kane.
Kane from Goldman Sachs. Just three from me as well, please. I suppose maybe just on wholesale, you also have the enterprise, you have 25 targets out there. You have lots of initiatives underway in your wholesale business. I suppose, just how do we think about that business? Is that, you know, a growth business or are these initiatives more about offsetting the legacy declines that are coming through?
Yeah. Thanks, thank you, Kane, and thanks for being patient to ask the question as well. I would think about wholesale in those three different businesses that I mentioned. In mobile, very much a growth opportunity. We're super low market share. And it's about using, I guess, other brands to help us reach more of the market opportunities that Kieren talked about, especially in regional or other areas. Mobile, very much a growth opportunity. I think on fixed data, you're right, there's a high degree of legacy revenues in wholesale that we still need to offset.
Approximately 14% of the business would be on legacy. We do have to offset those legacy revenues through that fixed data business. On the residential superfast networks, we see that as a growth opportunity. Very clear that we've got an asset that's relatively penetrated, but could go, what's the stopper saying? To 50%, for example, is a number. I think a real growth opportunity there with minimal investment and then further extension with additional investment if we see it as the best use of the capital at the time.
Do you think collectively million?
Yeah. I think there's collectively, I think there's no reason it won't become a growth opportunity. It's just the rate at which those three lines all work together.
Yeah. I suppose on the billion-dollar enterprise target. I suppose you just talk a bit about, you know, how the mix shift of that business plays out, you know, the lower margin managed services, NBN resale versus high margin fiber and mobile. How does that play out in 2025, you know, if you hit those targets? How important is the MOCN deal as well in terms of the enterprise piece?
Yeah. Great questions. Two things. I won't give, you know, precise guidance on the margin mix, so I'll not go there. What I'd say is one of the biggest opportunities which you touched on is mobile, which is a high margin opportunity that we currently don't capture at scale for lots of reasons. One, coverage, which I think you can see a clear path to how we address it. Two, a lack of focus on that market. For many years, we didn't have enough channel capacity for lots of strategic reasons. Now we suddenly do. Three, we've got a customer base to cross-sell into. Mobile is a really high margin opportunity. On the fixed side, the balance we take is NBN does give us great reach.
You know, we get a 850,000 connected premises that we can go with high quality Ethernet services to. There's a big reach from that. As you rightly say, the margin is lower on NBN than using our own fiber. Our overall ambition is to grow margin, absolute, probably not percentage margin, which I'm sure you'd appreciate, but a big opportunity to grow from those higher margin mobile products as well.
Just one last one. Just, I suppose, if this MOCN deal does for some reason get knocked back, I mean, how does that impact the strategy that's been set out today? Does it have an impact on CapEx or, you know, what I suppose, how do I think about the risk of it being knocked back on your business?
Yeah, we don't think about that in the sense that we are quite clear that this is a pro-competitive agreement. It is going to bring much more choices to much more Australians. It is going to create benefits in the usage of additional spectrum. From that perspective, we are quite rational in the sense that this is something that we are going to put in place, and that's what we are working on. We don't want to work on plans that, you know, will not happen. We really think this is something that will definitely happen. That's our view, of course, subject to the approval, but that's our view.
The guy standing at the back there. Eric, you've got the mic.
Okay. Thanks. It's Eric Choi from Barrenjoey. I've probably got one for Kieren, one for Ness, and maybe one for Grant. Just Kieren, on international roaming, I guess if we look at international departures, they're sort of back at 40%-50% of pre-COVID levels, and I would have thought you guys over-index on international as well. Is it fair to say, you know, that historic 260 international roaming ARPU number, maybe we could be back at a fair chunk of that today?
Thanks, Eric. A few things there. You're right. Pre-COVID, we had ARPU that related to roaming of about AUD 2.60. During COVID, as you'd expect, when we couldn't roam, our roaming revenue dropped right back to very little. We're back towards growing further towards the AUD 2.60. We are almost half of that currently. What I would say is that month-to-month, this moves quite a bit.
May was a big month of travel for us. What we may find is throughout the year that that starts to move up and down. Our overall view is that we will see the full recovery or, you know, the path to normalization for travelers inbound and outbound, we see is probably about a two-year period. We're really taking advice on that from actually Grant and his experiences with the airports. That's really where we're looking for that drift to return to. That would be roughly where it is.
Kieren, you mentioned postpaid ARPU has been improving during the period. Is there anything else contributing to it besides roaming?
Yep. A couple of things. As we covered in January when we went through the results at the end of the year, we'd seen an increase in our ARPU overall, and we'd seen an increase in our acquisition ARPU. That was driven probably by three or four things. Now there's an additional one with roaming, 'cause that wasn't really relevant at that stage. The first one was we changed our pricing back about a year ago, and we took off some perpetual discounts that we had on our most popular plans. As that started to wash through a year later, we're benefiting from those price changes. The second thing was the optimizing the ARPU at the point of acquisition.
What I mean by that is making sure the laddering of our plans means that we're not just going for the lowest cost plan, excuse me, but there's a really logical and easy upsell to be able to find customers in a slightly higher ARPU that best suits their needs. The third one is that we have been actively building the capacity and building campaigns to be able to upsell customers while they're midway through a plan or midway through their life. We've been changing that as well. You add on to that, to your point, the increase of roaming, and you start to see that we've had a strength in our ARPU relative to where we've come from.
Turn me off. Oh, there we go. Lots of questions about staff and costs, and I was wondering if we could dig into the EBA specifically. I know you're sort of combining lots of complex agreements. If you could maybe talk us through, you know, the changeover dates and how we should think about indexing to CPI.
All right. Thanks, Darren, for the question. At the moment and I'll comment on what I can because we're currently in bargaining at the moment. We've got three enterprise agreements, which are obviously legacy pre-merger agreements, which we're bringing together into one. That in itself is quite a challenge to unify those. We're in bargaining at the moment, but we expect the agreement to be in definitely in Q3.
The first pay increase for employees would be at that time, so when the agreement becomes effective. Then the next would be in March 2023. The negotiations have been going on for a little while. Obviously, you know, the hype around wages and inflation has extended it because we started these negotiations actually last year. We've spent more time with employee representatives just to make sure we're getting the agreement right for employees and for the business. Ongoing, once the agreement is in place, those increases will be effective March of each year.
Thanks, Ness. Last one may be the most difficult for Grant. Lots of useful disclosures on JVCo, but I think a lot of us are still wondering what the precise amount of debt sitting in JVCo for those two shareholders of yours are and maybe sort of what interest payments they need to service. Just any insight into that?
Pretty easy question. I don't control JVCo, so you'll have to ask the owners of JVCo. I have no idea what debt they have or haven't. They might have paid it down last night for all I know. Don't know.
Had to try. Thanks.
Sorry, it's Simon Conn from Investors Mutual. I'm sorry for maybe more a macro question, but we've just had a change of government in Australia. With that change, do you envisage any impacts? I'm just thinking like last time we had a Labor government, they thought up the NBN on the back of a fag packet and gave us a AUD 50 billion liability. Then we've had the Libs, you know, putting the digital tax to compensate for you know, some of the over-the-top providers try and get money into the media sector.
We've talked before about how, you know, the telco sector's done a great job of keeping Australia working through COVID. Do you envisage, you know, with your engagements with government, do you envisage any different changes in policy, approach, maybe digital tax? We're thinking of Queensland, you know. A lot of governments are in a lot of debt as well. Spectrum's a good way to raise money. I'm just trying to think what do you envisage out of this government?
Yeah, thanks for the question. Look, I think that, I mean, we like all governments in that sense, so I don't think that, you know, this government, we have had contact with Michelle Rowland for a long time, and we have discussed many times our views on NBN and different aspects of, let's say, the pressure points of the industry. From that perspective, we think that, you know, there is probably not going to be any challenge that wasn't there before or anything like that. I also think that, and this is a trend that doesn't just apply to Australia, I think it applies internationally. There is finally, I would say, the realization of how fundamental this infrastructure is for the economy.
Even in Europe, where you have seen commissioners extremely fundamentalist around, you know, certain things of that mobile should be doing this and that, are really backtracking in a lot of the views because there is a realization that the sustained investment in wireless and fixed infrastructure is a fundamental piece of the economy, as a fundamental piece of the new economy, where most of the people are working in a distributed manner. I do think that as an industry, now we have a much stronger case.
You know, if you look at, if you calculate how much money the industry has paid in spectrum taxes in the last 10 years is an unbelievable amount of money. I believe that that is something that now will be looked at with a very different perspective, because all the money that goes into a tax is not going to go into building fundamental infrastructure for the growth of the country. That is the discussion that we have had with both parts of politics, and I do think that we are getting much more traction on that. For that perspective, I see that there is a good way to collaborate with the new government on those issues, but also, like I said before, in making the NBN a bit better for everyone.
Just a quick follow-up question then, Iñaki. As being one of the two locally listed telcos, does that put you in a better position vis-à-vis other telcos who might be owned by foreign investment companies or overseas-owned, I suppose?
Yeah, thanks for that question. I do think that, you know, we are looking at this market from two perspective. We really look at the way of serving the market, creating infrastructure, serving the customers, but we also want to be the most attractive investment on doing so. I think that to look at that duality of perspective, I think is great to make a better company. I think it's good for us, to be operating in an environment like the one we are.
Just go to a couple of the questions online that haven't been asked in the room. There's a lot of detailed ones here. For those of you online, we'll get back to you where there are some of the more financial questions. We can point you to the right appendices. But some of the more strategic questions. The first one's around the MPN contract, Jonathan, with Yancoal. The question comes from Nick Harris at Morgans. Trying to just understand if you could give a bit more detail of what that service we're actually providing is.
Yeah, sure. Thanks then, Nick. Mobile private networks is a service that's typically used by companies that want to automate some of their operations. For example, it could be an energy company, manufacturing company, or in this case, a mining company. What it is is it's a network infrastructure that's stood up using public spectrum that we would have. Our public mobile network operates on spectrum, but it's used in a way that is effectively specific to that organization.
The reason it's important is it allows that company to then run their own mobile network effectively on top of that, which allows them to then do things like remotely control trucks or have security cameras or provide automation of robots or other services that need very low latency, highly secure services that can be delivered across wide areas. In this case, we're building it for Yancoal to help them in their mining operation. It's the first site that we've deployed, and we're currently in rollout. We'll do three things in that. We'll provide the management of that solution. We'll have a network management center. We'll build the infrastructure, and then we'll operate and run it for them. They will then run a whole range of automation or services that they choose on top of it.
Thanks, John. I've got another question from online. This one's from Harry Saunders at Evans and Partners, and it's a technology question for Giovanni. You alluded and touched on in your presentation around a potentially growing role of millimeter wave. So the question is, the fixed wireless getting to 20% of the fixed base over time, what's our view on the any investment that might be required and what the role might be of millimeter wave in delivering fixed wireless services over time?
Yeah. Thanks for the question. In essence, today, we use mostly the so-called C-band, so the 3.6 gigahertz, which is so-called also as the golden band for 5G, in order to satisfy all the capacity requirements across mobility and fixed wireless access. Obviously, we expect that especially in the top urban areas, there will be a moment in which we need to offload the fixed wireless asset traffic in order to give full capacity on that band to the mobility. At that point, the millimeter wave spectrum is becoming very helpful. It's a spectrum that traditionally was used for the backhauling, for example, in mobile network or point-to-point connectivity for enterprise customers. Obviously, this is less and less required thanks to the fiberization of the backhauling in terms of mobile sites.
We will be able to use it for customers. Clearly, it creates a different approach. In essence, as you know, due to physics, this is a spectrum that is covering less, so the penetration is less. It will require a little bit different devices, maybe mounting an external antenna for indoor locations and so on and so forth. We are already doing the first trials to see how does it perform. In other markets, it's already used, maybe due to spectrum constraints and different allocation of spectrum. We think it's reliable.
Thank you, Giovanni. We might just take the final question from these online questions. This one comes from Brian Han at Morningstar. It relates to the cross-sell strategy, and I think it's kind of an Ana question, Ana Kieren question. It relates to the system's capability that we have in our customer contact centers enabled to support cross-selling. Also, the question ends with would TPG need to consolidate some of its brands to better cross-sell? Ana and Kieren, you can divide that one up as you see fit before lunch.
Okay. Why don't I take a nudge at the brand one, and then together we can [Inaudible] t hrough the systems one. From a brand point of view, we're very lucky that we've got some of the best brands in the Australian market for our sector, and that they are a very broad set of brands. They tend to cover right across the market. We would observe also that they were set up not to work in complement.
Frankly, they were set up to compete with each other, and they've only come together through a series of mergers. We've now got the opportunity to relook at those and say, are they pointed in the right place? Are they solving the right set of customer problems? Do they resonate with those customers? And have they got the right level of investment? Are there some we need to invest more in or less in?
Are there some we need to retire, but there are some we need to, you know, increase in? We are just at the moment in the middle of that process. It's a very important process. We don't take it lightly. We know these are some of our largest intangible assets as a business and ones that have helped us grow to the organization we are now, so it's not an emotional project. It's a very, very analytical and careful project, and we're in the middle of that now. On the second question, in terms of the systems, why don't I have a first shot at part of that answer, and then I'll hand to Ana for a far better answer.
From our point of view, at the moment, what we're doing is we're building the early days really of building a far stronger data and analytics capability. That'll allow us to not only understand who our customers are and to unify or to federate all the different customer bases we currently have, which is absolutely table stakes. It doesn't actually get us that much closer because it's not really helpful to know if that customer has a mobile but doesn't have a fixed. That's somewhat useful. What's far more useful is to know that that customer has a mobile, doesn't have a fixed, and probably wants to change their fixed product soon. In order to get to that, we need to get much richer data about those customers, and we're building that now. That's the first point.
We're building both the core data capability. Giovanni and myself are working on our actual data model. We're building our decisioning tools and our campaigning tools so that we can start to have a far more anticipatory approach to when we cross-sell and when we service our customers. How that comes to life, actually in our call centers if someone calls up, I might hand over to Ana.
Of course. Thank you. That's a really great question in the sense that it affects a lot of the execution of the commercial ambition. If Kieren talked about the data analytics piece and how do we know more about our customers and use that data smartly, we actually need systems that are using that data and ingesting that data in a very smart way, either to help an agent to talk to a customer about an additional offer or to actually enable that in an automated fashion. For example, in a bot or for example in the IVR.
So when a customer gets in touch with us, we could know very quickly about that customer, who are they, what products are they using? Based on the intelligence that the customer lifecycle management team in Kieren's area is building, being able to immediately decide this is the next best offer that we could add onto this account. Genesys, as I was saying, is a platform. It is an integral platform that will enable the execution of this commercial strategy. It will actually make it easier and smarter to do, and probably even better, to do what we are currently doing today for the TPG and our iiNet brands, where the vast majority of the cross-sale is done through customer care and over the phone support.
It is a great model and it works every time. Because once we build the relationship with the customer, by solving an issue, by answering a question, it is the perfect moment we've discovered that in that moment, we have the trust of the customer, and the customer is ready, once they trust us and they trust the brand, to listen to an offer. We are doing it well today, but in a very, fragmented and very openly and honestly manual fashion. Putting tools in place, we could do it even better. That scalability factor that I was talking about, this is the most important thing. We know what to do, but we need platforms and better intelligence to scale it up, to really support that growth ambition through better ways other than just doing more manually these things.
Thank you, Ana. Well, thank you all. Lunch is served outside. Please stay and continue the conversation with the team. In addition to the executive leadership team, as pointed out, a number of the other members of the TPG senior leadership team are here in the room. If you can't remember from the profile photos who they are, it's easy, they're the really good-looking people. Iñaki, would you like to make any final remarks?
No, I mean, the only thing is, thank you, James, and all the people that have been involved, Bruce, in preparing this event. The people from the sound on the back trying to figure out who's talking. So thank you. Thank you to all of you for joining us today. We will do more of this, and we will, you know, everyone will be better. I hope that you enjoyed today. Like James said, we're happy to take any questions now while we are having something to eat. Thank you very much. Take care.