Deutsche Telekomwatch Report #4 September-October 2011 Executive Brief
27 October 2011
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- GROUP: Deutsche Telekom’s high-profile procurement partnership with France Télécom officially came into being, on schedule, with both companies reiterating the savings targets they outlined when announcing the joint venture in April 2011. Branded BUYIN, the operation will be headed by DT Chief Procurement Officer Volker Pyrtek, and has been given a wide brief, covering IT, network equipment, and service platforms. [pp.4, 5.]
- The Group and FT also continued to build their joint challenge to international rivals in the M2M communications sector, positioning UK joint venture Everything Everywhere as a conduit for targeting multinational businesses via a tie-up with DT US partner RACO Wireless. [pp.33, 34.]
- DT continued efforts to build support for its upcoming Smart Connect home networking solution, telling Bloomberg that talks have begun with consumer electronics makers in Asia and the USA. [p.8.]
- Group venture capital arm T-Venture continued to build an increasingly vast base of investments, contributing finance to German software companies Content Fleet and Cost Xpert. [p.10.]
- GERMANY: Telekom Deutschland (TDE) outlined plans for a major overhaul of its business intelligence function, handing a five-year “sourcing framework agreement” to IT services group Capgemini that will see offshoring to India. [p.12.]
- The European Union sent jitters through Europe’s largest incumbent telcos — and threw a curve-ball for TDE’s upcoming next-generation infrastructure strategy – by threatening a ‘stick’ approach on copper regulation, to promote investment in new fibre networks. [p.13.]
- T-Mobile Deutschland was officially cleared by Germany’s Bundesnetzagentur to target urban areas in the country’s south-west with LTE connectivity. Elsewhere, however, there was mixed news regarding regulators’ progress with LTE-enabling ‘digital dividend’ spectrum auctions, with Macedonia and Slovakia making progress towards allocation of frequencies, but UK communications regulator Ofcom announcing further delays to its auction. T-Mobile Hungary announced plans to launch LTE at the start of 2012, using its existing frequencies rather than waiting for digital dividend spectrum availability [pp.14, 23, 24, 30, 31.]
- EUROPE: Cost-cutting efforts continue in the Group’s challenged Europe businesses, with both Everything Everywhere and Magyar Telekom (MT) outlining plans to cut large portions of their senior executives tiers. The UK joint venture said 22 of its staff just below board level are to leave as part of new Chief Executive Olaf Swantee’s “simplification” of the company’s hierarchy; while MT said it is to cut almost a quarter of its directors as part of additional efficiency measures for the coming financial year. [pp.6, 21.]
- Governments’ financial pressures continue to weigh down the Group’s operations in southern and eastern Europe, both in terms of markets’ competitive and regulatory appeal. Bulgaria revived plans to raise funds through a fourth mobile licence tender, having ditched them, post-downturn, in 2008. Hungary announced it is giving candidates more time in its sale of spectrum to a fourth entrant. The country also appeared to dig in over its conflict with the EC regarding the investment-sapping “crisis” tax on telecoms players, shrugging off the Commission’s threat of legal action. Better news for the Group came with news that Croatia’s government may drop its also-controversial mobile services tax at the start of 2012. [pp.15, 17, 22, 24.]
- As previously mooted, Croatia’s Hrvatski Telekom (HT) pulled out of the race for a takeover of Kosovan incumbent PTK, prompting the collapse of the telco’s long-running sale process. However, HT’s recently acquired systems integration player, Combis, did progress regional expansion, opening an office in neighbouring Serbia. [pp.16, 18.]
- Both Makedonski Telekom and OTE revealed wide-ranging fixed network upgrades, with the latter migrating to a Huawei IMS network. Slovak Telekom outsourced fixed network functions to Ericsson. [pp.20, 25, 29.]
- Romtelecom signalled plans for an expansion of its outsourced services business with the opening of a new call centre in the eastern city of Bacau. [pp.26, 27.]
- USA: Churn-afflicted T-Mobile USA (TMUS) was in damage-limitation mode after humiliatingly being left out of the launch of Apple’s new iPhone 4S smartphone, announcing an “aggressive” marketing campaign around its higher end Android devices, and widening access to its interesting and disruptive Bobsled internet telephony service to iPhone (and other smartphone) users. [pp.9, 37.]
- TMUS’s Isis mobile wallet joint venture announced several device partners as it seeks to gain support to rival Google’s Wallet offering, and other OTT rivals. [p.35.]
- SYSTEMS SOLUTIONS: T-Systems highlighted new deals with: mailroom equipment specialist Neopost, in a boost for its recently restructured French business; and, South African glass manufacturer Consol, furthering ties with software partner SAP on cloud services. [pp.38, 39.]
About Deutsche Telekomwatch
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Published: October 2011
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