Telstra will plough AUD700 million into an AI joint venture with AccentureTelstra will plough AUD700 million into an AI joint venture with Accenture

The telco has reached a deal with global consultancy Accenture to create a fully-fledged joint venture tasked with modernising its data and AI platforms, and embedding so-called 'responsible AI' throughout the organisation.

"We've made strong progress on our AI goals and already have hundreds of value-driving AI use-cases across the business. This includes generative AI tools built in-house, like AskTelstra and One Sentence Summary, which are helping our people support customers more effectively and efficiently," said Telstra CEO Vicki Brady.

"But our data and AI ambition goes well beyond introducing AI tools. It goes to the heart of what we do – connecting Australia, and Australians to the world. From building self-healing, resilient networks, to reinventing experiences for our customers and the way we work, AI will help power an exciting, connected future," she said.

According to a Sydney Morning Herald report, Brady said Telstra will invest AUD100 million (US$62 million) per year into the venture, which is expected to operate for seven years. Nothing is set in stone just yet, and Telstra still needs to consult with employees and unions.

Under the proposed structure, Telstra will control 40% while Accenture will own the remaining 60%. Telstra's data and AI teams in Australia and India will be offered roles in the JV and, at the end of the seven years, they will be offered jobs back at Telstra again.

However, Telstra said the JV is expected to become more efficient and streamlined along the way, which suggests that there might not be a job for everyone at the end of it.

This is a slightly unusual move.

Joint ventures typically come about because the participants have spied a growth opportunity but need to fill a gap in their expertise and/or geographic footprint in order to make the most of it.

Digital transformations – even one as ambitious as Telstra's – are usually structured as partnerships, which for a large enterprise like Telstra typically boils down to forking over millions of dollars to a systems integrator. A good telecoms-related example was served up almost exactly one year ago when Vodafone inked its 10-year, $1.5 billion deal with Microsoft.

Telstra insists that a JV is the right approach to accelerating its AI strategy.

"We will get there much faster and more efficiently by collaborating in an ecosystem of like-minded global leaders, leveraging each other's strengths and accelerating innovation," Brady said. "Our strategic partnership with Microsoft and our joint venture with Quantium have been critical enablers in our AI journey so far, and this joint venture with Accenture will propel us into the next phase of our AI evolution."

Telstra said the joint ventures with Accenture and Quantium will consolidate vendor support from 18 data and AI providers and partners to just two, mimicking the strategy of its software engineering and IT operation, which last year went from working with more than 400 vendors to two strategic partners.

For Accenture, it's an opportunity to deepen ties with Telstra, and gain some valuable experience of delivering a sweeping AI and data transformation at a large enterprise.

"We are proud of our long-standing collaboration with a visionary leader like Telstra, and committed to accelerating its bold AI fuelled business strategy, which will set new standards for the telecom industry," said Accenture CEO Julie Sweet. "We are also excited about combining our experience, talent and capabilities with Telstra's to drive innovation and value for Telstra's customers, people, and shareholders today and in the future."