What does the latest 3G news mean for Telstra shares?

Telstra shares aren't budging from their new 52-week lows this week…

| More on:
Ordinary Australians waiting at the bus stop using their phones to trade ASX 200 shares today

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

It's been an awful few months for Telstra Group Ltd (ASX: TLS) shares. The ASX 200 telco hit a new 52-week low of $3.57 a share last week. That's the lowest Telstra has traded at in almost three years.

Today, Telstra shares are pretty much sitting at that new low. They are currently asking $3.60 each after dipping to $3.58 earlier this morning.

At the current stock price, Telstra is now down a nasty 9.2% over 2024 to date. The telco is also nursing a 16.6% loss over the past 12 months. Check that out for yourself below:

Created with Highcharts 11.4.3Telstra Group PriceZoom1M3M6MYTD1Y5Y10YALLwww.fool.com.au

We've looked at Telstra's recent woes quite extensively here at the Fool over the past few months.

It seems that the apathy from ASX investors towards Telstra shares began last year when the company decided against spinning off some of its most valuable telecommunications infrastructure. It has continued ever since.

The recent news regarding Telstra's 3G network seems to have done little to shift the dial.

Telstra, along with other Australian telcos, has been planning to shut off its legacy 3G network for many years now. 3G is a now-antiquated technology that has largely been superseded by the newer and superior (at least in terms of speed) 4G and 5G.

Telstra shares and a 3G delay

4G and 5G networks offer better download speeds and lower latencies than 3G. However, they also require far more infrastructure (towers etc.) to maintain a similar level of coverage.

This has led to 3G remaining relevant across many parts of Australia. Particularly in rural and regional areas that are yet to enjoy a full 4G or 5G rollout.

Like other telcos, Telstra has committed to ending its 3G networks so that the valuable spectrum that this network occupies can be re-utilised for other purposes. However, this plan will only be implemented once the company has ensured that all parts of Telstra's 3G network are covered by at least 4G.

Until this week, the final shutoff date for Telstra's 3G network was set for 30 June. However, the telco has announced this week that this date will be delayed by two months to 31 August.

According to planning to shut off its legacy 3G network from Federal Minister for Communications, Michelle Rowland, the Government has voiced concerns that some telco customers who still possess older phones may not be able to make emergency 000 calls once the 3G network is switched off.

Given the government has welcomed Telstra's decision to postpone its 3G switch-off, perhaps these concerns are why.

It's unclear if this decision to delay the demise of 3G is feeding into the Telstra share price this week. Saying that, Telstra shares did rise by 0.28% yesterday, and are up another 0.41% today.

No doubt investors will be hoping that the new 52-week low that we've recently seen proves to be a bottom for the ASX 200 telco.

Motley Fool contributor Sebastian Bowen has positions in Telstra Group. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has positions in and has recommended Telstra Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Communication Shares

Man smiling at a laptop because of a rising share price.
Communication Shares

Why UBS thinks REA Group shares can rise 16% in a year

This stock still has a very good outlook. Here’s why.

Read more »

Two men and a woman sitting in a subway train side by side, reading newspapers.
Broker Notes

After reviewing its result, how much upside does Macquarie project for News Corp shares?

News Corp released its FY 2025 results yesterday morning.

Read more »

An ASX investor in a business shirt and tie looks at his computer screen and scratches his head.
Communication Shares

Why did TPG Telecom shares just enter a trading halt?

The ASX has just made a major blunder.

Read more »

Person holding Australian dollar notes, symbolising dividends.
Communication Shares

Guess which ASX 200 share just announced massive dividend plans

This telco is going to make it rain for shareholders.

Read more »

Family celebrates buying new house
Communication Shares

Are REA Group shares a buy ahead of its earnings result?

REA Group will announce its FY25 result on 6 August.

Read more »

woman on phone
Communication Shares

Telstra shares lead reporting dates for 7 ASX 200 communication services stocks

Busy month ahead.

Read more »

A couple makes silly chip moustache faces and take a selfie on their phone.
Communication Shares

I'd buy 24,000 shares of Telstra stock to aim for $400 a month of passive income

I’d call on this telco for pleasing dividends.

Read more »

Smiling elderly couple looking at their superannuation account, symbolising retirement.
Superannuation

Is Telstra a superannuation portfolio staple?

Let's take a look.

Read more »