If you surf the web on your phone, you’ll know things can get a bit frustrating. I know when I surf the web I go down all sorts of rabbit holes, in the form of article links. But then I run into some problems. When I click on a new web page to see what it’s about the waiting starts. Instead of loading the web page quickly, my white screen is white. Leaving me to wait for the entire web page to load.
If you’ve ever had this problem don’t worry, it will be a thing of the past. Telstra Corporation [ASX:TLS] has entered into a strategic investment that will enhance mobile web surfing for customers.
Telstra has invested in Instart Logic, an application delivery service. It’s a smart move for Telstra. They can see a trend emerging. A trend of individuals switching the device they use for web browsing.
Instart Logic’s platform ‘downloads only the relevant aspects of a webpage’ said Mark Sherman, managing director of Telstra Ventures. Therefore you’re not waiting with a white phone screen to browse web pages.
Mr Sherman went on to state the service ‘enables users to view and interact with a page before all elements have finished loading. These techniques are highly beneficial in a mobile first world as they can reduce the download size of a typical application by more than 30%.’
So not only can you browse web pages faster, it uses up less mobile data. Thus a fatter wallet for customers each month.
Instart Logic is expecting to expand their business into Asia. CEO of Instart Logic, Manav Mital stated:
‘Asia has emerged as a global hub for mobile app businesses and we do see a lot of opportunities for us in the region by leveraging Telstra’s rich experience and footprint in the Asia-Pacific region.’
Asia would be the most logical next step for mobile applications. And what’s even move obvious is Telstra’s interest in Asia.
Telstra executive, Darrin Webb, revealed the company’s plans for a fibre optic network in Asia. Telstra bought out Asian telco, Pacnet last year and now expect returns on their investment. Major projects include a tighter integration between Pacnet and Telstra’s cable network.
Telstra sees China as its next big market. And they’re expecting the combined Telstra and Pacnet networks will be their competitive edge. Mr Webb stated.
‘Asia is an important focus for us, not only because of strong growth in the region, but it is also because we now control more assets here as a result of our acquisition of Pacnet last year. We are investing in opportunities to integrate our network in China and other priority markets’.
But before they capitalise on the growing Asian market, Telstra will address the issue of security.
Telstra takes PM’s challenge head on
Last year in November, Malcolm Turnbull demanded more innovation from Australian companies. Telstra has taken on the challenge, sending senior executive, Kate McKenzie, off to Estonia. There she would meet with key players in one of the world’s fastest growing tech hubs.
McKenzie was expected to seek out cyber security services. Potentially for Telstra to offer more services to domestic governments and companies.
Telstra is also planning to invest US$1 billion into a Philippines joint venture. But with all these new investments some shareholders are concern about capital for future dividends.
‘That’s the big challenge for us. Our investor base love their dividends, love their returns and why wouldn’t they? But at the same time as doing that if we don’t invest in the future it’s not going to be sustainable in the long term,’ McKenzie said.
What to do about Telstra’s shares
Since their announcement on Thursday, Telstra’s shares have climbed 2.79%. The jump has almost put shares into positive territory for the year. But shareholders are still seeing a negative return for the first three weeks of 2016.
Source: Yahoo finance
A major reason for the majority of Australian stocks performing poorly at the start of 2016 is China. Each time fears surface of China’s declining growth, Australian shares take a beating.
So far the S&P/ASX 200 has experienced negative returns for 11 days out of 14. But doesn’t this mean everything is cheap? Shouldn’t you buy cheap stocks?
Well, currently it’s unknown how long China’s turmoil will be a focal point. It will also depend upon what you are doing in the market. Are you speculating or investing?
The reason I ask the question is because it may determine whether you would buy/sell a certain stock. The difference between the two can be skewed, but generally the amount of risk can determine which category you might fit into.
Speculating forces you to take on higher risk, but you can be compensated with higher returns. Investing is based on fundamental analysis, taking on less risk and generally seeing smaller returns.
So should you speculate or invest when it comes to Telstra? Right now it looks like more of a speculation play. China continues to play havoc with our markets. But as to which way Telstra might head towards for the future is anyone’s guess.
Junior Analyst, Money Morning
PS: Telstra might not be classified as a beaten down blue chip, but there are some out there in the market. According to Money Morning’s Publisher Kris Sayce, there are five blue-chips that are a must buy.
Kris has close to 20 years’ experience in analysing stocks. His experience ranges from brokerage houses to a leading wealth management firm. But Kris has found his home at Port Philip Publishing. Kris understands that investing your money isn’t easy, especially in a declining market.
In Kris’s report he explains how moving some of your capital into beaten down blue chip stocks is a good idea. There is one common denominator that makes these five blue chips a buy. And Kris shows you how to identify this for future investments.
To get your free copy of Kris’s report today, click here.