Highlights in the second quarter of 2019

Investments in networks

5G spectrum won at German auction. We won four frequency blocks in the 2 GHz band and nine lots in the 3.6 GHz band worth a total of EUR 2.17 billion. We therefore acquired the spectrum we need for the planned network build-out. With the auction now over, we have filed an application with the Federal Network Agency on using the spectrum to begin building out our 5G network across Germany. The first 5G antennas are already transmitting in test areas in Berlin, Darmstadt, and the Port of Hamburg. We already operate 150 5G antennas throughout Europe. In Germany, more than 80 percent of existing antennas have already been upgraded to make them 5G-ready – we plan to install around 300 5G antennas at over 100 sites by the end of 2019. For more details, please refer to our media information.

5G spectrum secured in the United States. The Federal Communications Commission (FCC) has auctioned licenses for the use of millimeter wave (mmWave) spectrum for 5G. Over the course of the two auctions for 28 GHz and 24 GHz spectrum, T-Mobile US paid USD 842.5 million for a total of 367 MHz, thus securing itself a solid mmWave holding in preparation for 5G. Using the acquired spectrum, the first 5G cell sites were activated in six cities at the end of June 2019.

Fast internet for millions. Every month, we upgrade around one million lines in Germany to offer increased speeds of up to 250 Mbit/s. The number of lines with speeds of up to 250 Mbit/s has grown to its current total of nearly 22.5 million. Our goal is to provide fast internet lines to as many people as possible in rural and urban areas alike. One of the largest fiber-optic build-out projects in Germany is now underway in the district of Rostock: More than 44,000 households, 6,100 businesses, and 573 local government buildings, schools, fire departments, local authorities, and institutions in over 70 municipalities will receive one of our fiber-optic lines. With more than 7,200 kilometers of fiber-optic cable, over 1,100 kilometers of civil engineering works, and almost 850 new fiber distribution cabinets, we intend to bring higher bandwidths to this area alone by mid-2021. From the flatlands of the north to the mountains of the south: In June 2019 we connected the village of Balderschwang, known for having the highest town center in Germany, to our fiber-optic network. For more details, please refer to our media information.

New LTE cell sites in operation. Our LTE network is growing fast: We continued our network densification and expansion efforts in Germany, putting over 300 new LTE cell sites into operation in April and May 2019 alone. Around 51,000 households can now access our LTE network for the first time. These expansion activities are also essential for the future 5G standard: LTE will remain the basis for the ongoing development of the mobile network for many years to come. It also enables us to provide our customers with the best possible network – anywhere and anytime. We plan to raise the number of cell sites in Germany from 29,000 currently to around 36,000 in 2021. The share of population served with LTE is scheduled to increase to over 98 percent in 2019. For more details, please refer to our media information.

IoT network for Germany – IoT roaming in Europe. A dedicated mobile communications network for the Internet of Things (IoT) is now available nationwide in Germany. The machine and sensor network facilitates digitalization for businesses in a wide range of industries. It covers 90 percent of Germany and thus over 90 percent of the population. The project is scheduled for completion by the end of 2019. We are also introducing NarrowBand-IoT (NB-IoT) roaming in Europe to meet a key customer need: the ability to scale their mobile IoT offerings internationally. As a first step, the national companies in Germany, Austria, the Netherlands, Hungary, Slovakia, and the Czech Republic support roaming among each other. Other countries will follow. Nine European subsidiaries and the United States have introduced NB-IoT so far. Our NB-IoT networks are already up and running in several cities across the Czech Republic, Poland, Hungary, Croatia, and Greece. Nationwide rollout in these markets is scheduled for completion by the end of 2019. For more details, please refer to our media information.

Innovations and partnerships

Gigabit project in the Stuttgart region. The company Gigabit Region Stuttgart GmbH signed a cooperation agreement with us at the end of May 2019. Under the Gigabit project, the partners will focus on building out the ultra-fast fiber-optic network. One of the region’s aims is to provide all enterprises with high-speed internet access over optical fiber by 2025. Through 2030 the plan is also for 90 percent of households to benefit from the build-out. We also envisage the rapid rollout of a powerful 5G network. The agreement is unprecedented anywhere in Germany on this scale. The rollout area currently covers 174 municipalities in the Stuttgart area as well as in the five neighboring rural districts. To digitalize Germany, we are increasingly embracing collaboration models. In addition to partnering with the energy and telecommunications company EWE on the creation of the joint venture Glasfaser NordWest, over the past few months we signed joint initiatives with the Saarland utility company VSE NET and with Telefónica. For more details, please refer to our media information.

5G partnership with SK Telecom. Together with SK Telecom we plan to develop 5G network technology and innovative 5G platforms and applications. The primary focus will be on in-house technology for the new mobile communications standard. SK Telecom is one of a number of investors from outside the Group putting capital in the new Venture and Growth Fund II set up by DTCP.

Making drones more secure and efficient. We are working with DFS Deutsche Flugsicherung GmbH on a new technology that uses the mobile network to track unmanned aircraft systems (UAS). The joint venture Droniq GmbH is providing a drone tracking platform that will enable drone flights beyond the operator’s line of sight in the future. Droniq will initially focus on the German market, before gradually expanding into other European countries. Droniq’s primary target market is commercial drone pilots in the infrastructure, surveying, and agricultural sectors who want to fly drones beyond their line of sight – as well as the police, the fire and rescue services, and users from the general aviation field.

Digital X – analog exchange of ideas on digital innovation. As the digital revolution begins to take hold, the Digital X series of events focuses on exchanging ideas and networking. It is the largest cross-industry digitalization initiative in Europe. We are just one of several leading companies of the digital age involved in the initiative. It began its tour across Germany in April 2019 and is making the digital identity of six German regions into something to be experienced. The big finale of Digital X 2019 will take place in Cologne on October 29 and 30. Companies and decision-makers from all over Germany will assemble there to take part. For more details, please refer to our media information.

Municipal Advisory Board on digitalization. In May 2019, we convened the first meeting of the new Municipal Advisory Board in Berlin. The board, comprising 14 members from local communities and associations, will consult on issues relating to the broadband build-out, 5G, and other digitalization topics. This marks the successful implementation of a key action point from our eight-point program for the 5G rollout. One of the board’s central goals is to accelerate the pace of digitalization across Germany. The Municipal Advisory Board provides the framework for direct dialog between the municipalities and Deutsche Telekom. In the future, it will be a platform for discussing ideas, interests, and expectations and for finding a rapid resolution to certain issues. The board may also invite outside experts to attend individual meetings as guests. For more details, please refer to our media information.

Hannover Messe: drones, smart glasses, and smart displays. At Hannover Messe in early April 2019, we showed how “industrial intelligence” can help make planning, production, and logistics more efficient. Large manufacturers and SMEs alike found products and solutions for the smart factory at our booth. Examples included campus networks, 5G, drones, edge computing, smart glasses, smart displays, and artificial intelligence. We also premiered a raft of technical innovations for the digital economy. For more details, please refer to our media information.

Internet of Things: SAP and T-Systems connect their clouds. SAP and T-Systems are linking up their cloud-based platforms for smart devices and sensors. This will enable customers to seamlessly integrate their IoT data into SAP systems. A logistics solution is the first of these offerings. The telematics module not only pinpoints the location of goods via GPS, but can also track their speed and temperature. What is more, businesses now have the freedom to choose the ideal cloud-based SAP solutions for them. T-Systems is the first digital service provider to put SAP into all cloud environments, whether they be private, public, hybrid, or multi-cloud arrangements. This approach is one of the ways in which T-Systems is pressing on with its “cloud first” strategy for the digital transformation in business. The offering covers all clouds certified by SAP. For more details, please refer to our media information.

Climate protection target supports Paris Agreement. One of our climate protection targets is to use electricity solely from renewable energy sources by 2021. By 2030, we plan to reduce CO₂ emissions by 90 percent compared with 2017 (Scope 1 and 2). Also by 2030, we want to lower the emissions generated by the production and use of our products and customer solutions by 25 percent (Scope 3). These targets were presented to the Science-Based Targets initiative (SBTi) for review. The SBTi is an independent body of experts that evaluates the effectiveness of climate protection goals set by companies. They examine whether the targets comply with science-based standards and thus contribute to limiting global warming to below 2°C. The result of the evaluation is gratifying: SBTi approved our new targets after a thorough review. The SBTi has now recognized the climate goals of more than 200 companies worldwide as being science-based. As such, these companies are making a valid contribution to the 2016 Paris Agreement. In Germany, Deutsche Telekom is only the third DAX company to have been validated by the SBTi. Assuming responsibility for a low-carbon society has been one of the three fields of action of Deutsche Telekom’s corporate responsibility strategy since 2008. The Group formulated its first climate protection target back in 1995 and has been firmly committed to climate protection ever since. For more details, please refer to our media information.

Brand and products

Moving with Magenta Telekom into Austria’s digital future. T-Mobile Austria and UPC Austria have merged to form Magenta Telekom. Since the acquisition of UPC Austria in 2018, our Austrian subsidiary has bundled its offerings under the Magenta product brand while retaining the familiar “T” logo as its company brand. Customers continue to enjoy the best network quality. The new branding clearly marks a fresh start for the company – the Magenta brand will be far more prominent in communication than it is in other markets. With the bundling of its mobile and fixed-network products, Magenta Telekom is following our Group strategy. For more details, please refer to our media information.

Innovative solutions for business customers. In May 2019, we launched an innovate data protection package together with our partner DataGuard: From corporate groups to SMEs without in-house data privacy officers, businesses can now reliably and cost-effectively comply with the European General Data Protection Regulation (GDPR). We also added managed services to our portfolio of products for Office 365 and Microsoft 365 from the cloud (e.g., with the Premium Support+ Hotline or Mobile Access) to make it even easier for our customers to administrate and deploy their digital operational processes, the cloud, and the necessary IT solutions securely, conveniently, and efficiently.

For further information, please refer to the Media section on our website at: www.telekom.com/en/media/media-information.

Awards

The illustration below shows the main awards received in the second quarter of 2019. For details on more awards, please go to www.telekom.com/media.

Major awards in the second quarter of 2019