Telstra Corp., Australia’s biggest telecommunication group, gave a statement on Thursday that its first half net profit fell 3.3% from a year earlier as competition in the mobile sector increased, as it battled falling fixed-line revenues along the way as well.

Telstra Corp. chief executive David Thodey has also pulled out of his trip to the Mobile World Congress in Barcelona, the world's largest exhibition for the mobile industry, to instead concentrate on discussions with the government about Telco's role in the national broadband network.

Telstra’s chipset technology partner Qualcomm, cancelled its press conference at the event today, due to Thodey’s absence. It was expected that Telco would unveil a speed upgrade to its Next G mobile broadband network. The announcement is now expected to be made in a more subdued manner.

“We will keep its interim dividend at 14 cents a share”, said Telstra. First half sales revenue fell 2.5% to 12.32 billion Australian dollars from 12.64 billion Australian dollars.

"This reflects challenging market conditions due to changing calling behaviors and stronger price competition. We remain committed to try to find a mutually acceptable outcome, but the path ahead remains immensely complex”, the group's chief executive, David Thodey, said in a statement.