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Deutsche Telekom planning EUR30B investment


Rene Obermann

Deutsche Telekom is “substantially stepping-up investments in broadband networks and products over the coming three years in order to improve its competitive position in the long term”.

Announced at the company’s Capital Markets Day 2012, the operator said it will spend “around EUR30 billion” over the next three years.

It said its focus is on its home market of Germany, where spend will centre on the build-out of its LTE infrastructure, as well as rolling out optical fibre and vectoring technology in its fixed network.

It also noted that in the US, the rollout of a national LTE network is on the agenda, and that it has entered into an agreement with Apple to bring products to market together next year. This is a significant move and means T-Mobile USA will finally be able to compete with its three major rivals (AT&T, Sprint and Verizon) in offering the iPhone and iPad.

With regard to the US, it said it is in an “extremely good position” to benefit from growth, due to the spectrum it received from AT&T following the termination of their planned merger, a series of spectrum deals with Verizon Wireless, and an improved financial structure as a result of its cell tower deal with Crown Castle.

The company is also set to combine with MetroPCS, which is expected to close in the first half of 2013. “Hesitation now means playing catch-up later. We are investing in the future – with resolve and a clear strategy,” said Rene Obermann, chairman of Deutsche Telekom’s management board.

The company committed to paying a dividend of EUR0.50 in FY2013 and FY2014, compared with EUR0.70 in FY2012 – it will “re-visit” its plan for 2015. In a presentation, it said the dividend had been lowered to a “prudent and sustainable level”.

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