Indonesian JV Highlights Telstra's Regional Ambitions

Telstra has signed a non-binding memorandum of understanding with Telkom Indonesia to create a joint venture, or JV, that will provide network services in Indonesia. The proposed JV will be the exclusive provider of network application and services, or NAS, in Indonesia for both companies. Although in isolation this is a relatively small event for Telstra, the deal highlights one of the ways Telstra can deliver on its Asian growth strategy. Partnership with local players could provide Telstra a lower-risk alternative to acquisitions, which are also likely to form part of the expansion strategy. That said, these partnerships are "slow-burn" opportunities that are unlikely to deliver a material earnings contribution in the short to medium term.