OTE Store, Athens

There were further suggestions Deutsche Telekom (DT) could be set to take up an opportunity offered by the Greek government’s ongoing privatisation programme to expand ownership of OTE Group.

DT was again reported to be in ongoing discussions over a 5%-portion of OTE equity now managed by the Hellenic Republic Asset Development Fund, which oversees state asset sales. The Fund was in October 2016 said to have taken on the holding from the government, to fulfil a requirement laid down earlier in the year, as part of the country’s European Union-led bailout programme. Greece is aiming to raise EUR6bn from state asset sales in 2016-2018, and local reports suggest it may gain around EUR200m from the 5%-stake’s divestment.

DT – which currently holds 40%, plus one share, of OTE’s equity – bought into the Greek operator as the regional sovereign crisis hit in 2008, and was then compelled by a government put option to increase its ownership to current levels in 2011 (Deutsche Telekomwatch, #2 and #11). Its shareholding encompasses OTE’s operator interests in Albania (Telekom Albania), Greece (Cosmote Greece), and Romania (Telekom Romania, Telekom Romania Mobile, and Zapp Romania), as well as various other businesses such as carrier services arm OTEGlobe, contact centre provider e-value, maritime communications specialist OTESat-Maritel, and retailer Germanos.

OTE’s shareholder agreement is thought to give DT not only a level of operational control over the operator, but also right of first refusal on the government’s remaining share (10%, including the 5% now in question). The government is thought to continue to hold a veto on certain OTE decisions, around areas such as the operator’s domicile, mergers and acquisitions (M&A), and national security issues, as well as licence to appoint five directors on OTE’s board. These rights appear to have formed a key focus of negotiations between the state and DT.

Direction of travel is towards stake boost

DT has long been mooted for an expansion of its ownership of OTE, taking advantage of the Greek government’s cash-flow pressure. In 2014, it was mooted to be in line to secure the government’s full 10%-holding, although a deal did not subsequently materialise (Deutsche Telekomwatch, #28). In mid-2015, DT Chief Executive Timotheus Höttges indicated “there might come an opportunity” for a stake-increase and that the Group would consider “any deal under the right terms” (Deutsche Telekomwatch, #45).

An increased presence in OTE would fit with the Group’s commitment to focus primarily on in-footprint M&A, as seen with the 2014 T-Mobile Czech Republic minority shareholder buyout and GTS Central Europe acquisition, and full takeover of Slovak Telekom in 2015, and BT-linked reboot in the UK (Deutsche Telekomwatch, #29, #32, and #41).

While DT continues to list Greece as its most macro risk-laden market, Höttges and Chief Financial Officer Thomas Dannenfeldt have been noticeably positive towards OTE’s performance in recent quarterly financial presentations, possibly seeding the idea of deeper involvement in (and increased exposure to) the Greek group. Across its business, OTE reported a 0.4%-drop in revenue and 5.5%-fall in pro forma core earnings during its last full financial year, to 31 December 2015 (Deutsche Telekomwatch, #51).

Image: © Bloomberg.

Table of Contents

3 Executive brief
5 Group
6 Corporate Development
9 Legal and regulatory
10 People
15 Strategy
16 Supply chain
17 Technology & Innovation
21 Germany
22 Products and services
22 People
25 Europe
26 Croatia
26 Greece
29 ICSS
30 Poland
32 Systems Solutions
33 Contracts
33 Partnerships
34 Products and services
36 USA
37 Network
39 Commercial
39 Corporate development
41 Supply chain
43 Further reading
47 Index

Index

Symbols

3rd Generation Partnership Project (3GPP) 19, 40

A

ADVA Optical Networking 18
Alcatel-Lucent 17, 18
Allianz 23
Amazon.com Inc. 22
Amdocs 10
América Móvil 39
– TracFone Wireless 39
Americas
– North America 33
– United States of America (USA) 11, 16, 33, 36, 41
– – Federal Communications Commission (FCC) 37, 40
– – States
– – – Florida 17
– – – Iowa 41
– – – Maryland 33
– – – Pennsylvania 41
– – – Philadelphia 41
Apple
– iOS 22
AppNexus 7
Asia-Pacific
– Australia 10
– Japan 40
– Malaysia 33
AT&T 10, 37

B

BMW 19
BT Group 10, 12
– BT Global Services 10

C

CeBIT 35
Cinven 7
Cisco Systems 34, 35
Cogent Communications 11
Continental AG 19
Cosmote Romanian Mobile Teleco. SA (see OTE/DT) 10
Cyfrowy Polsat SA 30

D

Daimler AG 19, 33
– Mercedes-Benz 33
Delivery Agent 9
Deutsche Bahn 34
Deutsche Telekom 6, 7, 9, 10, 11, 12, 13, 15, 16, 17, 18, 19, 22, 23, 24, 26, 27, 29, 30, 33, 34, 35, 37, 39, 40, 41
– Corporate
– – Headquarters 22
– Deutsche Telekom Capital Partners 9
– – Deutsche Telekom Strategic Investments 7, 9
– – – AppNexus (see separate) 7
– – – Delivery Agent (see separate) 9
– – DocuSign (see separate) 9
– – Fireglass (see separate) 9
– – Morphisec (see separate) 9
– – NSONE (see separate) 9
– – SafeBreach (see separate) 9
– – Strato (see separate) 7
– Europe
– – Austria 10
– – Croatia (Hrvatski Telekom) 10, 26, 27
– – Czech Republic 7, 27
– – Greece (see OTE) 6, 29
– – Hungary (see Magyar Telekom) 10, 23, 27
– – International Carrier Sales & Services (ICSS) 10, 29
– – Netherlands 10
– – Poland (Polska Telefonia Cyfrowa/PTC) 30
– – – NetWorkS! 30
– – Romania (see Cosmote Romania/OTE) 10
– – Slovakia (Slovak Telekom/T-Mobile) 27
– European Aviation Network 17
– Executives
– – Abolhassan, Ferri 10, 23
– – Andrasi, Judit 10
– – Arnold, Heinrich 10, 24
– – Backofen, Dirk 23
– – Brnjac, Goran 10
– – Dannenfeldt, Thomas 7, 22
– – Dumitrache, Carmen 10
– – Goldenits, Walter 10, 23
– – Gregovic, Mladen 10
– – Höttges, Timotheus 7, 9, 11
– – Jacobfeuerborn, Bruno 10, 23
– – Klatt, Pierre 34
– – Legere, John 41
– – Nemat, Claudia 22, 23, 24
– – Ray, Neville 37, 40, 41
– – Seiler, Martin 24
– – Tomic, Davor 10
– – van Damme, Niek Jan 23
– – Vojvoda, Mario 10
– – Warda, Charlie 29
– – Wolf, Gotz 23
– – Young, Jack 9
– Ex-executives
– – Albo, Luigi 10
– – Iskos, Lampros 10
– – Kasteel, Hendrik 10
– – Müller, Markus 10, 23
– – Rook, Ivo 10
– – Yarkoni, Erez 10
– Germany 9, 10, 22, 23, 24, 27
– Investments
– – Magyar Telekom (see separate) 10, 23, 27
– – OTE (see separate) 6, 7, 10, 17, 26, 27, 29
– Product and Innovation
– – Telekom Innovation Laboratories (T-Labs) 10, 18, 24
– Products and services
– – Binge On 39
– – MagentaEINS 23
– Systems Solutions 32
– – Telekom IT 23
– – Toll Collect GmbH 33
– – T-Systems 10, 22, 23, 33, 34
– – – Detecon 10, 24
– – – Telekom Security 23
– Technology
– – 5G
haus 19
– USA 10, 37, 39, 40, 41
Deutsche Telekom Capital Partners 9
– Deutsche Telekom Strategic Investments 7, 9
DocuSign 9
Dr. Ing. h.c. F. Porsche AG 22

E

Emblaze Group
– European Telecom 11, 15, 18
Ericsson 10, 19, 26, 37, 40
– Croatia (see Ericsson Nikola Tesla) 26
Euronet Worldwide 10
Europe
– Albania 6
– Austria 10, 22, 24, 34
– Croatia 10, 26
– France 22
– Germany 7, 9, 10, 11, 12, 15, 19, 21, 22, 23, 24, 29, 33, 34, 35
– Greece 6, 7, 26, 27, 29
– – Government 6, 7
– – Hellenic Telecoms and Post Commission (EETT) 29
– Hungary 10
– Italy 10, 22
– Netherlands 22
– Northern Europe 10
– Norway 17
– Poland 30
– – Urząd Komunikacji Elektronicznej (UKE) 30
– Romania 6, 10, 27
– Slovakia 10
– Sweden 26
– Switzerland 10, 17, 24, 34
– United Kingdom (UK) 7
European Association of Automotive Suppliers 18
European Automobile Manufacturers’ Association 18
European Automotive-Telecom Alliance 18
European Competitive Telecommunications Association 18
European Telecommunications Network Operators’ Association (ETNO) 11, 12, 13, 15, 18
European Union 6, 11, 12, 13, 15, 16, 17, 30, 33
– European Commission 11, 12, 13, 15, 16, 18, 19, 30

F

Facebook 13
Fireglass 9
Flybridge Capital Partners 9
Forthnet 27, 29
France Télécom
– Orange 30
– – Poland (see Telekomunikacja Polska) 30

G

Global mobile Suppliers Association (GSA) 18
Google 13
– Android 22
GSM Association
– Mobile World Congress 10
GSM Association (GSMA) 15, 18
GTS Central Europe 7

H

Hellman & Friedman 7
Host Europe Group 7
Hrvatski Telekom (see DT, Croatia) 10, 26, 27
– Combis d.o.o. 10
Huawei Technologies 19, 34, 35

I

IDI Billing Solutions 41
Inmarsat 17
Inteliquent 41
Inter IKEA Systems B.V.
– Family Mobile (UK) 39
Intracom Holdings
– Hellas On Line (HOL) 27

L

Level 3 Communications, LLC. 41
Lufthansa 17

M

Magyar Telekom (see DT) 10, 23, 27
Market segments
– Machine-to-machine (M2M) 22
– Mobile virtual network operator (MVNO) 16, 39
– Multinational corporations (MNCs) 10
Microsoft 34, 35
– Skype 13
Midas
– Aero2 30
Middle East 29
– Dubai 29
– Qatar 10
– United Arab Emirates 29
Morphisec 9
Movilitas Consulting 33

N

News Corp. 7
Nexmo 9
Next Generation Mobile Networks 10, 19
Nokia 17, 18, 19, 37, 40
NSONE 9

O

Open Handset Alliance (OHA)
– Android 22
OTE (Hellenic Telecom. Org. SA, see DT) 6, 7, 10, 17, 26, 27, 29
– Cosmote 6, 10, 29
– – Albania (Telekom Albania) 6
– – Greece 6, 29
– – Romania 6, 10
– Germanos 6
– OTE TV 26, 27

P

Polkomtel 30

Q

Qualcomm 39, 40

R

Raiffeisen Bank 10

S

SafeBreach 9
Samsung 37
SAP 33
Sferia SA 30
Sigma Prime Ventures 9
Slovak Telekom (see DT, Slovakia) 27
Strato 7

T

Technology
– 2G 41
– – CDMA 30
– – GSM 15, 18
– 3G 41
– 4G 19, 27, 30, 37, 40, 41
– – Long Term Evolution (LTE) 17, 19, 27, 39, 40, 41
– 5G 12, 13, 19, 37
– Billing 41
– Bluetooth 33
– CRM 35
– DSL 26
– Fibre 11, 12, 18, 27
– LTE-Vehicular (LTE-V) 19
– M2M 22
– Narrowband Internet of Things (NB-IoT) 35
– OSS 41
– R&D 18, 19, 24
– SIM 16, 22, 30, 35
– Smartphone 34
– SMS 11
– Spectrum 13, 37, 40
– – 800 MHz 30
– – 2600 MHz 30
– VDSL 27
– W-LAN 12, 26, 39, 40
Telefónica Group 18
Telekom Austria 23
Telekom Slovenije
– ONE 39
Telstra 10
Tesla 26
Thales Group 17
Toyota 19
Twitter Inc. 9, 41
Two Sigma Investments
– Two Sigma Ventures 9

U

United Internet 7

V

Value-added services 39, 41
ver.di (Vereinte Dienstleistungsgewerkschaft) 24
Verizon Communications 37, 39, 40, 41
– Verizon Wireless 37, 39
Vodafone 10, 16, 18, 27, 29
– Europe Region
– – Greece 10, 27, 29
Volkswagen AG
– Audi AG 19

W

Wal-Mart Stores Inc. 39
Weather Investments
– Orascom Telecom
– – WIND Hellas 29
– – Wind Telecomunicazioni 29
WhatsApp Inc. 13

About

About BTwatch

Report: #275
Covering: April 2016
Published: May 2016
Next report: June 2016
For more information visit: BTwatch