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Timotheus Höttges

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Vaccinate and Renew

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An article by CEO Timotheus Höttges about the end of the pandemic and the beginning of a renewal process in Germany and in Europe. This article was first published as a guest contribution on the portal www.welt.de.

The Corona crisis reveals clear weaknesses and failures in Germany and Europe. For now, all attention must still be focused on overcoming the pandemic. After that, we should not praise ourselves for what has worked well. Instead, we should change what is obviously going badly. And thus "vaccinate" ourselves as a society against future crises.

Timotheus Höttges, Chief Executive Officer (CEO) Deutsche Telekom AG.

Timotheus Höttges, Chief Executive Officer (CEO) Deutsche Telekom AG.

Hollywood has known this. The film "Contagion," released in 2011, is about a worldwide pandemic: Starting in Asia, a deadly virus spreads throughout the world. It's about scientists who become heroes. About reproduction rates. About the distribution of vaccine. About people in quarantine. About death and suffering. Even about conspiracy mystics who live - and die - in a reality all their own. Everything even more dramatic than we are currently experiencing. But still strikingly close to it. And with a happy ending. So Hollywood knew it. And we all knew it too. It was never a question of "if". It was only a question of "when. 

And yet we in Germany and Europe were frighteningly unprepared in many places: in education, which is far from digital; in many administrations, which are not either; in our supply chains and processes; in production, which is largely located in Asia. And to some extent in our business models, which are less digital than elsewhere. This crisis has no winners. It is a tragedy. But the stock market certainly knows it. 2020: Amazon up 68 percent, Docusign up 226 percent, Netflix up 54 percent ...

We should not fall into a "sleep of the satisfied"

Even if the crisis is not yet over: we see light at the end of the tunnel. But what will follow? Will we pat ourselves on the back for what we have shouldered? Yes, we got through the first wave of the pandemic in the spring of 2020 reasonably smoothly. Because people showed solidarity with each other. Because they got down to work. Because Home Office was possible thanks to stable communications networks. Because the state cushioned a lot of the blow with extensive aid, such as short-time work allowances. And also thanks to outstanding German research, which at the same time tells an encouraging story about immigration.

But after the crisis, we should not fall into a "sleep of the satisfied," as happened in part after the first wave. What, then, has been substantially improved in schools since then?

My impression is that we have made ourselves comfortable in our systems. In a double federalism of the European Union and 16 federal states. In our institutions. In our processes. Set up in part for noble goals - see EU. Established in part because most of it has worked - often poorly. At least so well that it was easier to ignore part of the reality. Instead of fighting the battles and overcoming the resistance that change inevitably encounters.

Post pandemic renewal process

The development of the Corona vaccine opens up great possibilities for us. It can mean the end. The end of the pandemic. But it must also mean a beginning. The beginning of a renewal process on many levels. Both in Germany and in Europe. 

It starts with an honest analysis: What went well? What went badly? What are we changing as a result? That also applies to Telekom; we like to get involved. 

Digital Education

In education, for example. The ifo Institute found that during the first lockdown, 45 percent of all students had no individual contact with their teachers. 57 percent had online lessons less frequently than once a week. There is a lack of hardware, software and enough educational servers. Certainly, teachers must be fit for digital instruction. Didactically. But they also need to be proficient in the technology they use.

Deutsche Telekom could immediately assign 1,000 employees to develop future concepts, provide technical support and much more. But it can't be the case that such services are only ever accessed when they are free of charge. 

Infrastucture expansion

The second issue is, of course, the expansion of infrastructure. Not just broadband networks, but also rail networks, power grids for the energy transition, charging networks for eMobility etc. Telekom invests more than five billion euros a year in Germany. More than any other competitor. And at the same time, we are cooperating with Telefónica and Vodafone to close even more wireless gaps.

My goal is also: By 2030, every household will have a fiber-optic connection. Some of it will come from us. Some will come from our competitors. That costs a lot of money. How do we manage that? Ten digital companies generate 80 percent of Internet traffic on our infrastructure, which is where they make their profits. But they don't share in the costs. But it would be good if billions from the Valley could also be used for fiber optics in Germany.

European single market

Thirdly, we need to further develop the European single market. Because so far we have not been able to consistently exploit economies of scale. Antitrust law should not be based on 27 member states, but on one Europe. This would help create providers that can compete with the giants from America and China. This includes mergers in banking, manufacturing and also telecommunications. Without the same economies of scale, we will never achieve the same sovereignty. 

Structure reform

Fourth, in my view, all this will only be possible if we reform our decision-making structures and administrations. Structures are not laws of nature. They can be changed. Here, politics has its own task, responsibility and unrestricted influence quasi "in its own backyard." The goal should be to reduce bureaucracy and not to create new obstacles for others.

We do not have a crisis of understanding. But an implementation crisis. In our multi-layered decision-making structures, individuals certainly have good intentions. But the lowest common denominator achieved is often neither communicable nor problem-solving. And we should no longer have to discuss the rule of law as the core of the European idea at all. 

What we can tackle 

All of this presupposes a kind of cultural change in our society. The question must not be "What do I have to lose?". Rather, it must be "What can we all gain?" And what concrete contribution am I making to that? 

Some points we can tackle directly:

  1. A new antitrust law that allows for scale and protects European interests. That facilitates European cooperation and ensures open and fair markets.
  2. Consistent expansion of infrastructure and suitable framework conditions for those who invest. Ideally with open standards such as the so-called O-Ran in my industry.
  3. Transformation of the European economy. Including European cloud, which needs demand. That means priority in public tenders.
  4. Administrative reform at all levels that ensures greater efficiency and positions the state as a demand driver for digital applications as an innovation driver. And please don't forget the schools! 

Perhaps it would be wise if we not only put the pandemic behind us. But also old hostilities, some convictions and outdated structures. Please, no pats on the back. Instead, we should look ahead optimistically and get down to work. This should be "a matter of honor" for each of us. Not like in Hollywood. But with a happy ending.

Timotheus Höttges, Chief Executive Officer (CEO) Deutsche Telekom AG

Timotheus Höttges

Timotheus Höttges, Chief Executive Officer (CEO) Deutsche Telekom AG

Timotheus Höttges, Chief Executive Officer (CEO) Deutsche Telekom AG.

Looking ahead: With a digital turbo out of the crisis

An article by Timotheus Höttges, Chief Executive Officer (CEO) Deutsche Telekom AG.

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