Contingent model: Telekom gains cooperation partner

  • 1&1 will use the revised contigent model
  • Companies to work together to boost utilization of the VDSL infrastructure
  • Contingent model simplifies investments in new broadband infrastructure

Deutsche Telekom has gained a first partner for its contingent model. 1&1 Telecom GmbH, Montabaur, will use the revised contingent model and intends to serve the increasing demand for fast broadband lines. Telekom benefits from the cooperation agreement by achieving greater utilization of its VDSL infrastructure. "We are investing billions in broadband networks. With the contingent model, partner companies assume part of the risks of this high infrastructure spending," emphasizes Niek Jan van Damme, Member of the Board of Management for Germany at Deutsche Telekom. After modifications were made to the original contingent model, the Federal Network Agency and EU Commission gave Deutsche Telekom the green light for such cooperation. Companies now have an extraordinary right to terminate the agreement if they want to use new fiber optic lines as an alternative. The minimum contingent was also reduced, to allow smaller companies to book contingents of VDSL lines. And lastly, the monthly charge has been increased by 50 cents per line. Deutsche Telekom is currently in talks with NetCologne, with the aim of adjusting their cooperation agreement, which was signed in late 2011, to the new contingent model. The two companies plan to use their broadband infrastructures jointly: NetCologne wants to book a contingent of Telekom VDSL lines, while Telekom will lease a certain number of fiber optic links from NetCologne in return. Further cooperation agreements of this type are to follow. Telekom also plans to offer fiber optic lines as a wholesale product through the contingent model. Deutsche Telekom's VDSL network currently reaches some 11 million households in 50 cities. To continue broadband network expansion, Telekom is investing in mobile communications solutions such as LTE and fiber to the home (FTTH), as well as fiber to the curb (FTTC, the basis for VDSL).

About Deutsche Telekom Deutsche Telekom is one of the world’s leading integrated telecommunications companies with almost 130 million mobile customers, 33 million fixed-network lines and over 17 million broadband lines (as of June 30, 2012). The Group provides products and services for the fixed network, mobile communications, the Internet and IPTV for consumers, and ICT solutions for business customers and corporate customers. Deutsche Telekom is present in around 50 countries and has over 233,000 employees worldwide. The Group generated revenues of EUR 58.7 billion in the 2011 financial year – more than half of it outside Germany (as of December 31, 2011).