Announcing the move to shareholders this morning, the telecommunications giant said it planned an "8,000 net reduction in employees and contractors" in a strategy nicknamed "Telstra2022".
Telstra says the new strategy is aiming to "improve customer service, simplify structure, and cut costs".
It is understood that one in four executive and middle management roles will be slashed.
Chief executive Andy Penn said the dividend for FY18 would be 22 cents per share and dividend decisions for FY19 would be announced during the financial year.
Reducing the number of consumer and small business plans from 1800 to 20.
"When I look at a lot of the activity in the business, it's dealing with issues and complications and problems that we've created for customers because of the complexity in the design of the product", he said.
"That's obviously very hard news to share, because Telstra is an fantastic organisation, awesome family of people and that was why it was so important for me to speak to the teams first in delivering that news", he said.
That's where the job losses - including the wiping out of two to four layers of management - stem from.
Ratings agency S&P last month downgraded Telstra's debt for the first time in 12 years, highlighting the company's dwindling market share amid rising competition in Australia.
"The $50 million transition fund is supporting in relation to enhanced outplacement services, post-employment support, training, coaching, those sorts of things as well", he said.
"This means that some roles will no longer be required, some will change and there will also be new ones created".
"There is virtually no technological innovation happening today that does not rely on a high-quality, reliable, safe and secure telecommunications network. However, we are now at a tipping point where we must act more boldly if we are to continue to be the nation's leading communications company". The new strategy has been given the moniker Telstra2022.
Mr Penn said the telecommunications sector had never been under more pressure, with the development of the NBN, significant increased competition, and huge pressure to invest in new technologies.
The strategy doesn't specifically answer the question of where Telstra's growth might come from but, if it can execute effectively, it could create a better and more effective business and a platform for growth in an exciting 5G environment whose boundaries are yet to be defined.
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