‘Smug’ Telstra chiefs admit 15-year-old technology contributed to crippling triple zero outage

Telstra admitted ignoring multiple warnings for years on the need to update software linked to last week’s mass outage that crippled the triple zero service, with the company declaring it’s too early to say how much compensation will be paid.

The July 7 outage brought train networks in NSW and Victoria to a standstill, stopped electronic payment systems from working and prevented more than 600 people from connecting to Triple Zero.

During a senate inquiry hearing on Friday, top executives conceded the nationwide event could have been prevented if a 15-year-old, $30,000 server had been replaced earlier.

Telstra chief executive Vicki Brady began her evidence by telling the committee the telco had let customers and the community down, declaring “we fell short of what people rightly expect from us”.

“For this, I am deeply sorry. Australians rely on Telstra every day to run businesses, stay in contact with family, access essential services and most importantly, to get help in an emergency.

“When our network fails, the impact is real. I particularly want to acknowledge the concern caused by impacts to some people’s triple-zero connection,” the telco boss added.

Greens Senator and inquiry chair Sarah Hanson-Young pressed Telstra on whether a server, which was 15 years old and cost roughly $30,000, should have been replaced sooner.

“A newer piece of hardware, operating in the same design that we intended to, (and) the issue wouldn’t have happened,” Telstra’s group owner of end-to-end service performance and resilience, Gerard Tracey conceded.

Telstra confirmed an update flagged by the manufacturer as far back as 2020, again in 2022, and once more in January this year, was never applied.

Under questioning from Labor Senator Helen Polley, the Telstra boss could not rule out any more outages but insisted the telco was doing the necessary work to mitigate the risk.

“I would love to be able to sit here and say there will be zero outages. The reality of a complex network environment, with fast evolving technology, you just can’t, no telco around the world could guarantee that,” Ms Brady said.

“But absolutely, we accept here that it wasn’t good enough. Our controls and our processes definitely let us down, and that impacted a lot of people, and we are deeply sorry for that.”

At one point during the hearing Senator Hanson-Young labelled the Telstra executives as “pretty smug” as they dodged questions about the telco’s reliability.

“So when you’re banking huge increases in profit, there are more outages, less reliability for people to access and use their mobile phone. I just don’t think it’s, I don’t think it washes, to go around telling people that your system is resilient,” the senator said.

Pressed on how much its compensation bill would be following the disruption that left millions of people unable to access mobile services, the Telstra boss said a final figure was yet to be determined.

“I do not have an idea of what that’s going to cost Telstra in terms of customer credits or claims,” she said under questioning from Senator Hanson-Young.

“We can’t sit back and say this is how it affected all customers and do an analysis. That’s why we’re making it as straightforward as we can for our customers to contact us and provide us with that information.”

Asked if she expected all 8.8 million customers would receive compensation, Ms Brady said she did not and would instead be determined on a case-by-case basis with a majority of customers given credit.

Senator Hanson-Young then demanded to know why “credit is better than cash”, to which Ms Brady responded that credit was most effective and quickest method to compensate their customers.

“I just don’t know how much people will want credit if they can’t rely on their mobile phone,” Senator Hanson-Young replied.

Chief financial officer Michael Ackland confirmed the carrier had received around 8000 requests for compensation for the outage, with approximately $100,000 already paid out but said larger claims were still being processed.