A boost for broadband expansion: Federal Network Agency approves cooperation model

  • Federal Network Agency approves Deutsche Telekom's revised contingent model
  • Draft decision will now be submitted to European Commission for consultation
  • Group intends to push ahead with fiber optic expansion and agree further cooperation

Broadband expansion in Germany has been given a fresh boost: The Federal Network Agency's concerns about the contingent model were laid to rest after Deutsche Telekom made some changes. The changes grant companies a special right to terminate the agreement if they are able to use new fiber optic lines as an alternative. The minimum contingent is also being reduced to allow smaller companies to book contingents of VDSL lines. And lastly, the monthly charge is being increased by 50 cents per line. In making these changes, Deutsche Telekom has acted on key points of criticism from the Federal Network Agency. "By clearing this hurdle, we have taken a significant step forward with broadband expansion. Next-generation network expansion will only succeed through cooperation. The industry must be able to share costs and risks if they are to invest billions," stressed Niek Jan van Damme, Board member of Deutsche Telekom responsible for business in Germany. The Group intends to roll out its fiber to the home (FTTH) network to eight more towns and cities this year. Deutsche Telekom already provided FTTH lines to 168,000 households in ten German towns and cities in 2011. In the coming year, it intends to connect another 200,000 households if at least 80 percent of the homeowners agree and a threshold of ten percent is exceeded during pre-sales. Deutsche Telekom announced in January of this year its intention to cooperate with NetCologne based on the contingent model, committing to ordering a specific number of fiber optic lines from NetCologne. In return, NetCologne wants to lease a specific contingent of VDSL lines from Deutsche Telekom. Initially, the Federal Network Agency had temporarily prohibited this type of cooperation. The revised model has now been approved and will be submitted to the European Commission for further consultation. Other companies in the sector have already expressed their interest and Deutsche Telekom intends to expand cooperation.

About Deutsche Telekom Deutsche Telekom is one of the world’s leading integrated telecommunications companies with more than 129 million mobile customers, almost 34 million fixed-network lines and 17 million broadband lines (as of March 31, 2012). The Group provides fixed-network, mobile communications, Internet and IPTV products and services for consumers, and ICT solutions for business and corporate customers. Deutsche Telekom is present in around 50 countries and has over 235,000 employees worldwide. The Group generated revenue of EUR 58.7 billion in the 2011 financial year – over half of it outside Germany (as of December 31, 2011).