Deutsche Telekom cuts sales forecasts

29 Jan 2007

German incumbent Deutsche Telekom (DT) has cut its revenue forecast for 2006 to EUR61.3 billion (USD81.5 billion) after it continued haemorrhaging fixed line customers in the fourth quarter, despite a revamp of tariffs in September. A total of 2.1 million German subscribers cancelled services last year, double the figure that left in 2005. The weak dollar has not helped either, as a sizeable chunk of the telco’s US sales come from wireless subsidiary T-Mobile USA. During 2007 DT will transfer 45,000 staff to a new entity where they will be forced to accept lower wages. CEO Rene Obermann said that this would save the company EUR5 billion by 2010. The installation of its VDSL network will continue in the coming year, reaching 50 German cities by the end of next December. It is hoped this will stem the exodus of fixed line customers.

Germany, Deutsche Telekom (DT)