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Company Brief
Deutsche Telekom

by Faulkner Staff

Copyright 2021, Faulkner Information Services. All
Rights Reserved.

Docid: 00014049

Publication Date: 2112

Report Type: VENDOR

Preview

Deutsche Telekom is one of Europe’s largest telecommunications providers
and the largest in Germany. The company specializes in network access,
communications services, and value-added services, adding ever-increasing
bandwidth via fixed and mobile networks. With a focus on broadband and the
mobile Internet, Deutsche Telekom’s strategy has been to solidify its position
in Germany and grow in foreign markets. It has been focusing on security issues,
forming partnerships, expanding its cloud services, and extending its fiber
optic network. As of 2021, the company has 242 million mobile customers, 27 million
fixed-network lines, and 22 million broadband lines.

Report Contents:

• Fast Facts
• History
• Key Executives
• Major Products
• Major Competitors
• Recent Activity

Fast Facts

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Deutsche Telekom
Friedrich-Ebert-Allee 140
53113 Bonn, Germany
Bonn District Court HRB 6794
Phone: +49-228-181-4949
Fax: +49-228-181-9400-4
Web: https://www.telekom.com/en
Type of Vendor: Global Telecommunications Provider
Founded: 1996
Service Areas: Germany and about 50 countries worldwide
Employees: 226,300 worldwide
Stock Symbol: DT

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History

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Deutsche Telekom AG, based in Bonn, Germany, is Europe’s largest
telecommunications and information technology service firm, with two-thirds of
its reported 100 billion euros in net revenue (as of 2020) generated outside its
home country. As an international group,
Deutsche Telekom has a presence in more than 50 countries worldwide and the
company employs some 226,300 people.

In order to gain admission to the European Union, Germany established the Deutsche Bundespost
in 1989 as the incumbent and government-owned provider of the country’s telecommunications. To comply with the EU’s mandatory
privatization, the Federal Ministry of Posts and Telecommunications, then
the telecom regulatory body for the country, was disbanded and was replaced by the
Regulatory Authority for Telecommunications and Posts. Deutsche Bundepost
thus became Deutsche Telekom in 1996. The German government still holds a
15 percent stake in company stock directly and another 17 percent through the
government bank KfW.

In 1996, Deutsche Telekom launched on the German stock market.
In 2001, it acquired VoiceStream for $24 million USD and launched
T-Systems. The following year, it launched the T-Mobile brand in the UK,
Austria, and the Czech Republic, and VoiceStream was also rebranded to T-Mobile. In
2004, the company began a vast reorganization of its four main businesses,
and began the spinoff of its 400 T-Punkt sales outlets as an
independent company. It completed the re-integration of the T-Online unit
in 2006 to offset the loss of revenue from its fixed-line operations.
Rene Obermann, who headed T-Mobile International, took over
the reins of the parent company in 2006 and cut Deutsche Telekom’s debt in
half. Under his guidance, the company rolled out a next-generation broadband network in Germany,
reduced the size of its German workforce, and moved to compete against
smaller vendors by cutting prices.

The following year, the company separated Deutsche Telekom’s support
services unit and acquired Orange Netherlands. In 2008, it found a partner
for its T-Systems business unit, Cognizant Technology Solutions of
Teaneck, NJ. It also became the exclusive distributor of the Apple iPhone
in Germany in 2008, and celebrated its ten millionth DSL customer. In
addition, it unveiled the first cell phone using the Android operating
system with Google, and announced a partnership with British rival
Vodafone to develop a fiber optic network for high-speed Internet access
in Germany to serve up to 100,000 homes. In 2009, Deutsche Telekom
bought a 17 percent stake in Indian telecommunications firm Devas Multimedia and
successfully engaged in a joint European 100G field trial on an Ericsson
optical platform.

In 2010, the company reported plans to hire 9,000 new staff and
train 13,000 new employees over the next several years. It also delisted
itself from the New York Stock Exchange (NYSE) in an effort to “reduce
complexity and costs,” and completed the merger of its UK
business with France Telecom’s Orange UK to form Everything Everywhere.
The following year, the company agreed with France Telecom-Orange to
combine their procurement activities of customer equipment, network
equipment, service platforms, and IT-Infrastructure in a 50/50 joint
venture. Facing US government regulatory hurdles, AT&T and Deutsche Telekom terminated their
$39 billion agreement to
sell T-Mobile USA to AT&T. In 2012, and the company reported that CEO
Rene Obermann would leave at the end of 2013, with Timotheus Hoettges becoming
CEO in January 2014. Also in 2014, the company established the European
M2M Partner Program to market machine-to-machine (M2M) services across
Europe.

In December 2015, the company reported plans to form a cybersecurity
division, consolidating its existing security operations into one unit. In
December 2016, Deutsche Telekom reported that it would sell all Strato
shares to United Internet for 600 million euros, and completed its
sale of seven million shares in Scout24 AG to receive gross proceeds of
approximately 57.6 million euros. In 2017, the company allied with EWE to
extend the fiber-optic network in Germany’s Northwest Region, and signed
an agreement with Ericsson to provide “3-G ready” network infrastructure
across half of Germany. In December 2018, T-Labs joined Hyperledger, an
open source collaboration focused on advancing blockchain technologies. In
2019, Deutsche Telekom decided to freeze its 5G alliances with vendors as
it waits for a decision about the use of Huawei in its networks.

In April 2020,
T-Mobile US completed its long-delayed acquisition of Sprint; the deal was
completed after two years of scrutiny from the US regulators with the outcome being
T-Mobile’s complete takeover of Sprint. In addition,
Deutsche Telekom expanded its strategic agreement with Nokia in 2020. The
companies are building a 5G-ready IP network using Nokia’s 7750 Service
Router. In November 2020, the company allied with Extreme Networks to launch the next generation of
Telekom’s managed net-based LAN service, NBLS 2.0. Deutsche Telekom is
using ExtremeCloud IQ, a cloud management platform, as part of the
company’s managed net-based LAN service portfolio. Additionally, SK
Telecom and Deutsche Telekom created a joint venture to develop advanced
5G in-building technology to respond to the demand for 5G repeaters. In September 2021,
the company announced it would sell T-Mobile Netherlands to a pair of private equity firms, Apax Partners and Warburg Pincus, for 5.1 billion euros.

Key Executives

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• Timotheus Hottges – Chief Executive Officer
• Birgit Bohle – Board member for Human Resources and Legal
  Affairs,
  Labor Director
• Thorsten Langheim – Board member for USA and Group
  Development Deutsche Telekom AG
• Adel Al-Saleh – Board member for T-Systems
• Srini Gopalan – Board member for Germany and Managing Director, Telekom Deutschland GmbH
• Christian P. Illek – Board member for Finance (CFO)
• Claudia Nemat – Board member for Technology and
  Innovation
• Dominique Leroy – Board member for Europe

Major Products

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Deutsche Telekom offers broadband and fixed-network services all over
Europe, its T-Mobile brand in 11 markets across Europe and the US, and
one-stop information and communications technology solutions for large and medium-sized businesses worldwide.
The following table provides information about these products and
services.

Major Competitors

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• BT: http://www.bt.com/
• Orange: http://www.orange.com/
• Vodafone: http://www.vodafone.com/

Recent Activity

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Deutsche Telekom and Telefónica/O2 will work together to overcome several hundred "gray spots" in
4G network coverage for their German customers. These spots typically exist outside residential areas and away
from major transit routes. The agreement aims to close this coverage gap by implementing active network sharing
at several hundred selected antenna sites, ultimately enabling operators to offer all customers
4G access in the 800 MHz frequency band at each site.

T-Systems, the company’s cloud services unit, announced renewal agreements with Shell, Deutsche Post DHL Group,
and Heineken. Shell renewed its global master services agreement which is designed to reduce the carbon
footprint of Shell’s IT operations, the DHL Group will continue to have its information and communications technology –
voice and data networks – managed by T-Systems, and Heineken renewed its commercial agreement for another five years to
continue its transformation to the cloud. Altogether, the deals are said to add two billion euros to Deutsche Telekom’s
bottom line.

Deutsche Telekom’s strategic investment fund the Telekom Innovation Pool (TIP) announced it has made an investment in
Celo, a blockchain-based payment platform, with the telco also buying an unspecified amount of the platform’s digital
token. Celo is an open-source blockchain ecosystem focused on making decentralized financial systems and tools accessible
to anyone with a smartphone. Deutsche Telekom will work on security and infrastructure development as the alliance aims
to "build a financial system that creates the conditions of prosperity – for everyone," according to a company
press release.

In September 2021, Deutsche Telekom announced the sale of its T-Mobile Netherlands business to funds managed by a pair
of private equity firms. Although the division had been expected to be sold to one of Europe’s larger telecommunications
companies, the group of funds managed by Apax Partners and Warburg Pincus will pay 5.1 billion euros for the Dutch mobile
operation, which is majority owned by Deutsche Telekom with Stockholm-based Tele2 holding held a 25 percent share.

 

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