Telstra says profits are down as the NBN takes away its wholesale fixed-line customers.

Telstra's half-year profit has tumbled 27 per cent to $1.2 billion, leading it to slash its interim dividend to just 5 cents per share, with an additional 3 cents of special dividend.

“Telstra's circumstances today are very different from what they were before the NBN,” Telstra CEO Andy Penn has told reporters.

“We are no longer the national wholesale provider. That part of our business — the revenue and value — is being transferred to the NBN and that is reflected in our income, profit, and dividends.”

NBN Co has a mandate to deliver a commercial return to its shareholder, the Federal Government, which Mr Penn says is making the network charge telcos far too much for access.

“If you compare the wholesale price today relative to what is was historically, when Telstra was a wholesale provider, prices are probably more than double,” he told the ABC.

“The wholesale price needs to reduce by $20 not $2 so that is order of magnitude that we need to consider.”

But Telstra has been able to save millions through aggressive job cuts.

Just over 3,200 people have left Telstra on the way to a target of cutting 8,000 full-time positions by financial year 2022.

Mr Penn said the company is banking on 5G mobile.

“Thanks to our new partnership arrangements with a series of leading manufacturers, 5G devices will be available exclusively through Telstra before any other Australian mobile operator when they are released in the first half of calendar year 2019,” he said.

“Telstra's global leadership on 5G will help ensure mobile is the engine room of our business into the future.”