Internet
Telekom’s fiber optic expansion is making progress
The logo of Deutsche Telekom AG: The company has announced figures for the third quarter. photo
© Martin Schutt/dpa
When it came to the Internet, Germany was a copper country for decades: thin telephone lines had to suffice in many households. Today, fiber optics are on the rise. But customers don’t access them wherever the cables are located.
By the end of 2024, fiber optics are expected to be in reach of more than 10 million households. “We want to keep moving forward on our beat rate,” said CFO Christian Illek. Competitors are also expanding, but Deutsche Telekom is far ahead. Fiber optics is considered the best technology for meeting the increasing data needs in the Internet age.
However, fiber optic contracts are generally more expensive than connections via telephone lines (VDSL) or television cables. That’s why many consumers are still hesitant – not everyone will take advantage when fiber optics are finally available on their street. Telekom says it has 910,000 fiber optic customers in Germany so far, 263,000 more than a year ago. The proportion of households that have fiber optics on the sidewalk or even in their basement and who also use it as paying customers has therefore fallen, it is only around 13 percent.
CEO Höttges: We have to do better in terms of marketing
“We are currently building in the expectation that customers will come to us in the next few years,” said CEO Tim Höttges. When asked why the usage rate is still so low, he said: “I would like to see Germans being even more willing to buy fiber optics where it is available – we have to do even better on the marketing side.”
Telekom is currently being criticized. Smaller competitors and the industry association Breko accuse the Bonn-based group of a strategic “superstructure” – that is, that the company is announcing fiber optic expansion projects where other companies are already present and whose business calculations are being shaken by the threatening presence of the market giant. The fact that two companies are laying fiber optics separately in one area and therefore lacking the already scarce construction capacity in other areas is also raising eyebrows in politics.
Höttges rejected the allegations on Thursday. From his point of view, such activities are part of normal competition. They are also good for consumers, after all they have the choice in the end. Overbuilding by Telekom is only happening in two percent of the expansion areas, said the manager. In other areas, Telekom is being overbuilt. He warned against regulatory interventions that would create local monopolies. “I would like to see a discussion in Germany that prioritizes the future viability of the infrastructure and the digital economy instead of calling for economic regression.”
Telekom presented business figures on Thursday, according to which group revenue in the third quarter slipped by 4.9 percent to 27.6 billion euros. This was due to a change in leasing of devices and negative exchange rate effects. Organic sales increased slightly. The bottom line is that Telekom earned 1.9 billion euros, a good fifth more than the year before. The globally active group with a strong US subsidiary has around 204,000 full-time positions, 60,000 of which are in Germany.
Communication from Telekom