Telstra chief executive Andy Penn says he lost a lot of sleep before the telco's board decided to deliver less of the company's profits to shareholders.
"It was a very tough decision," Mr Penn said at an exhibition in Melbourne of Telstra's technology.
"We spent a long time debating it, and I can assure you I spent many sleepless nights thinking about it.
"Because I know it has a significant impact on our shareholders, and many of you in the room today will be shareholders."
Telstra announced the change to its dividend policy in August, and Mr Penn again said on Wednesday that it was the right decision.
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Telstra will use the funds to invest in new technology, enabling it to withstand changes in the telecommunications sector and increased competition, he said.
Telstra shareholders will now get between 70 and 90 per cent of the company's underlying profit, ending a longstanding practice of being paid almost 100 per cent of underlying profit.
Telstra shares plunged to a five-year low after the telco announced the new policy.
Mr Penn also said on Wednesday that he would not underestimate rival TPG Telecom, which on Tuesday said its mobile network will be up and running in parts of Sydney, Melbourne and Canberra ahead of schedule by the middle of next year.
"It's not really for me to comment on their rollout," Mr Penn told reporters.
"All I can tell you is that we're absolutely committed to continuing to have the best mobile network in the country as well as all of our other networks.
"We're leading with that through our investments in 4G, 4GX and the IoT network...so we'll just continue to focus on doing that."
Mr Penn said Telstra had always been at the forefront of technology innovation and industry leadership, and would continue to be.
Telstra needs to become a technology company, not just a traditional telecommunications company, that provides digital technology to boost connectivity in business and in the home, he said.
Telstra shares were down 3.5 cents at $3.615 at 1410 AEST, and have dropped almost 17 per cent since the new dividend policy was announced.
