DEUTSCHE TELEKOM

COMPANY PReSENTATION
DEUTSCHE TELEKOM COMPANY PRESENTATION
OVERVIEW

01 Deutsche Telekom
02 Strategy & Transformation
03 Network, Products & Innovation
04 Service & Brand

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DEUTSCHE TELEKOM
PROFILE
Customers & Markets Facts & Figures

Customers Markets Telekom in figures, 2017 Employees & responsibility

Present in > 50 countries Revenue € 74.9 bn  Employees worldwide: 217,349
 168 mn mobile customers  

28 mn fixed-network lines/  Germany, Europe and the USA:  Adjusted EBITDA € 22.2 bn  6,559 trainees and cooperative
degree students in Germany
19 mn broadband lines with own infrastructure  Free Cash-Flow € 5.5 bn
 Pioneer of social issues
 Approx. 7.4 m TV customers  T-Systems: global presence & (climate protection, data privacy,
alliances via partners diversity, etc.)

Source: DT 2017 annual report/TMUS annual report to shareholders 2017

DEUTSCHE TELEKOM StrategY & Transformation Network, Products & INNOVATION Service & BRAND
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Customers & markets, facts & figures
GERMANY

43.1 million mobile customers € 21.9 billion revenue

13.2 million broadband lines € 8.5 billion EBITDA adjusted
3.1 million IPTV customers incl. satellite 63,928 employees
101,901 employees in Germany overall
Financial figures taken from DT's 2017 annual report

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Facts & Figures: Germany
Europe & United states

Europe:
48.8 million mobile customers
T-Mobile US: 5.6 million broadband lines
72.6 million mobile customers 4.2 million IPTV, satellite, cable customers

USD 40.3 billion revenue € 11.6 billion revenue

USD 10.5 billion EBITDA adjusted € 3.7 billion EBITDA adjusted
45,888 employees 47,421 employees
59 952 employees in EU overall
Financial figures taken from DT's 2017 annual report/TMUS' annual report to shareholders 2017

Direct shareholdings
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Facts & figures: EU & US
T-SYSTEMS

Information technology and telecommunications

services in all industries:
automotive, finance, transport,
retail & public sector
€ 6.9 billion revenue
Pioneer in cloud computing € 0.5 billion EBITDA adjusted
Corporate customers, multinational corporations
& public sector 37,924 employees
Financial figures taken from DT's 2017 annual report

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Facts & figures: TSI
HOW WE SEE OURSELVES

WHAT CONNECTS US.

It is in our nature to seek the company of others: humans need this interaction in Our network is an artery pumping life: fast, reliable and secure.
order to move forward. Sharing fosters closeness. It is the very reason we choose to It provides easy access to all who need it.
share our important moments with those important to us.
We are close to the consumer and are transparent, fair, and open to dialogue.
We share events, experiences, and opinions – sometimes even our possessions. We identify innovative products at an early stage and develop them in
We share knowledge and our ideas. And quite often, by sharing these thoughts, we collaboration with our partners. We do all of this better than anyone else.
turn them into something bigger, something better. That is what drives us. This ability forms the basis of trust – an essential ingredient for long-lasting
relationships.
We, Deutsche Telekom, are more than just another company, which provides society
with infrastructure. Whatever the circumstances, we are a trusted companion in both Precisely this is the essence of our work at Deutsche Telekom.
people’s private and work lives. Together, with passion, focus and efficiency, we are entering a world
of infinite possibilities.
Whenever. Wherever. Forever
making life easier for people and enriching it is our mission. This connects us.

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Profile
We take responsibility

Data privacy Diversity Sponsorship

Leading role in data privacy & data security Leading role in societal and diversity-related issues Commitment to culture & sport
 Data Privacy Report &  Pioneer as first to introduce Group-wide  Amateur & professional sports
Security on the Internet report women’s quota e.g., German football association (DFB),
 Honeypots as early warning  Special programs & initiatives to Bayern Munich, Olympic & Paralympic Games,
system against cyber attacks promote education & training ”New sports experience“ project in
 Modern working models, e.g., E-mail Policy
recreational sports
 Culture/examples:
 Winner of the Max Spohr prize for
exemplary promotion of diversity International Beethoven Competition, Beethovenfest

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Responsibility
We take responsibility
CORPORATE RESPONSIBILITY
Sustainability & social engagement Groundbreaking projects
Environmental and climate protection  Group climate protection target:
E.g., CO2 reduction, efficient use of resources, 20% less CO2 by 2020
sustainable mobility
Social engagement & stakeholder mgmt.  ”Yes, I can!“ initiative for children and young adults:
E.g., promote employees’ social commitments, 5 years, 500 projects, 50,000 opportunities
support education and competence in media
Sustainable products and innovations  ”Blue Angel“:
E.g., environmentally friendly and accessible products, first cordless telephone on the market
efficient data centers, ehealth to have the eco-label
Sustainable supply chain
E.g., binding requirements for the supply chain,  Supplier selection and development:
inspections and audits sustainability as a key criterion

Integrated financial and CR reporting

 Success in respected rating indexes and rankings:
E.g., mandatory CR KPIs for the entire Group in the annual
oekom, CDP and Sustainalytics, among others
and CR reports, sustainability indexes

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Responsibility
OUR GUIDING PRINCIPLES

Customer delight and Respect and integrity Team together – Best place to perform I am T –
simplicity drive our guide our behaviour Team apart and grow count on me
action

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Guiding Principles
DEUTSCHE TELEKOM COMPANY PRESENTATION
OVERVIEW

01 Deutsche Telekom
02 Strategy & Transformation
03 Network, Products & Innovation
04 Service & Brand

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Our AMBITION: LEADING EUROPEAN TELCO

Grow
Lead In Customer experience Lead in technology Lead in Business Productivity

ONE CONNECTIVITY INTEGRATED Secure ICT SOLUTIONS

& PERFECT SERVICE GIGABIT networks & Big IoT

Save for Growth Investments

Simplify, digitalize, accelerate

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CX: One Connectivity & Perfect service
Leading in integrated Leading TV provider in Perfect service
customers in DE & EU European footprint enabled by digitalization

Convergence/ Magenta1 TV/ Exclusive content Customer service

▪ DE: Market leader with ▪ Increase market share in ▪ Zero Defect initiative
MagentaEins integrated NatCos ▪ “Every client becomes a
▪ EU: Leverage FMC1 as growth ▪ Exclusive content (e.g. sport) and sensor”– for network & service
driver; close convergence gaps OTT offerings quality
▪ “Functionality follows quality” for ▪ “Digital first” with high self-service
new versions rate
1) FMC = Fixed Mobile Convergence
Ambition
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Technology: Integrated gigabit networks
Leading in all core Leading Gigabit network Leading narrowband IoT
markets with 5G in Germany provider in DE & EU

Mobile – 5G Fixed line – fiber Narrowband IoT

▪ Mobile edge computing (e.g. live ▪ DE: Gigabit network (incl. ▪ EU- and US-wide narrowband
tests at autobahn A9) technology mix and cooperations) networks
▪ Build spectrum position, ▪ EU: Technology leadership1/ ▪ Strong partnerships (e.g. Ista,
launch from 2020 close convergence gaps2 Veolia and LBV3 Hamburg)

Convergence and cloud-based production model

1) In integrated NatCos, esp. GR, HU, SK, HR;
Ambition 2) In mobile-centric NatCos (e.g. PL & CZ);
3) LBV = Landesbetrieb Verkehr
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Business Productivity: Secure ICT solutions & Big IoT
Leading in intl. connectivity A leading provider of IoT Preferred partner
for German business customers and security in DE & EU of German SMBs

TC – “Germany Outbound”/ ngena IoT/ Security IT/ Cloud

▪ Best international connectivity for ▪ IoT: Management of connected ▪ “Mittelstandsoffensive 2.0”:

German B2B customers (incl. All-IP) devices and industry connectivity Standardized IT offerings with
▪ ngena for implementation of ▪ Partner ecosystem & vertical SMB focus
global SD-WAN1 solution solutions (e.g. fleet management) ▪ TSI: Structural improvement in
▪ Optionality for industry ▪ Leading in Security in DE & EU cloud/ classic IT
consolidation
1) SD-WAN = Software-Defined Wide Area Network
Ambition
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Opportunities driven by innovation & Partnering

Lead in Customer Experience Lead in Technology Lead in Business Productivity

e.g. Convergence/ Magenta1 e.g. Edge Computing/ 5G e.g. Smart City

▪ Radical simplification of product ▪ Computing power from the network ▪ IoT-based urban infrastructure in
logic (“One stop shop“) – telco advantage: proximity to clients Europe
▪ Access-agnostic products – for DT ▪ Scaling/ standardization via ▪ Innovative cooperation and funding
& non-DT clients industry cooperation models
▪ Household, not customer logic ▪ Establish ecosystem with strong ▪ Examples: E-mobility, “Park and Joy”,
partners “Smart Lighting”

…supported and accelerated by partnering with the best companies in our ecosystem

Ambition
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Need to increase Transformation speed

Simple Digital Agile

▪ “One product (per use case)”: ▪ “Fully enabled”: 100% self- ▪ “Lean telco”: Flat hierarchies and
Lean product portfolio service capabilities for customers short decision processes
▪ “One app”: One digital customer ▪ “Segment of one”: 100% ▪ “Disrupt yourself”: Short innovation
interface personalized offerings cycles & inorganic innovation
▪ “Focus on customer-facing ▪ “Data-empowered intelligence”: ▪ “Skills matter”: New competencies,
activities”: Less redundancies 100% data-driven decision making incentive models & culture of failure

…taking into account stability requirements in business-critical areas

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our strategic core beliefs
We relentlessly strive for leadership in customer experience
▪ We provide one seamless global T-connectivity
▪ We offer the leading FMC proposition based on simple & modular products
▪ Our sales experience is truly omnichannel, and our service is digital, proactive, and ‘perfect’

We lead in technology with future-proof & integrated Gigabit networks

▪ We maximize Gigabit coverage with future-proof fiber networks and alternative technologies such as FWA/5G
▪ Software-defined networks enable real-time operations
▪ We operate one central & virtualized production model to realize group-wide synergies
We are THE trusted
We are the leading partner for business productivity
▪ Secure and reliable ICT solutions drive end-to-end digitalization of our business customers partner for our
▪ Our horizontal platforms and vertical solutions enable the Internet of Things
▪ Partner products and services enhance our core proposition
customers’ digital
needs
We strive for a benchmark cost structure and re-invest into growth
▪ Benchmark efficiency is necessary to preserve our competitiveness & maintain high investment volumes
▪ Organic and inorganic investments spur growth in our core business and selected adjacencies

We constantly digitalize, simplify and accelerate our operations

▪ Digitalization increases our efficiency and improves customer experience
▪ We build a radically simplified and agile IT architecture
▪ Our people are empowered to take ownership, collaborate across silos, and work in a truly agile way
▪ We take a flexible & step-wise approach to effectively implement our strategy

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DEUTSCHE TELEKOM COMPANY PRESENTATION
OVERVIEW

01 Deutsche Telekom
02 Strategy & Transformation
03 Network, Products & Innovation
04 Service & Brand

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Our best network at a glance
Numbers, data, facts
13 mIllion broadband lines Over 93% LTE NETWORK COVERAGE
LARGEST NUMBER OF OPTICAL FIBER CUSTOMERS OF ALL HIGH AVAILABILITY OF FAST MOBILE INTERNET11
EUROPEAN NETWORK OPERATORS1
More Than 42 Million Customer
25,000 NEW „GRay BoxEs“ telephone and surf in the mobile communications
network1
MULTI-FUNCTION CASING for FAST INTERNET2
Giga-Speed
Up to 500 MBIT/S FTTH: 1 Gbit/s Download And 500 Mbit/s upload
4 bILLion EURO Mobile surfing with LTE
Annual investment in GERMANY More than 20 Million Lines
Connect our Fixed network in Germany
1

FIRST HYBRID ROUTER

FOR MORE BANDWIDTH in the mass market 500,000 „Gray BoxEs“
E.G. cable splitters and MULTI-FUNCTION CASINGS1

More than 7,500 Cooperation Projects 45 Million phone calls

WITH CITIES AND MUNICIPALITIES FOR BROADBAND EXPANSION1
Daily via IP platform in fixed network and mobile
communications
70,000 Migrations About 30,000 km annually
To IP-based telephony PER WEEK Grows our fiber optic network

15 MIllion Lines 455,500 km 200,000 construction pits

on MODERN IP-BASIS
1 fiber optics network Dug In 2016
1 as of Q2/2017 2 in 2016

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Numbers, Data, Facts
Our best network at a glance
awards
Best network coverage, bandwidth and stability.
In mobile and fixed networks.
 Leader in broadband quality for mobile communications and
fixed network
 Innovative products
 Biggest bandwidths
 Best network coverage

Awarded repeatedly.
 For the sixth consecutive time: Telekom wins the
large-scale Connect and CHIP mobile network tests
 Car Connectivity Award: 7 out of 10 readers vote as the best
automobile network
 TÜV certified: Telekom Deutschland offers the best mobile
network quality in LTE, according to QcC standard.*

* QcC: Quality comparison from the customer's point of view with the criteria "Success rate in setting up a call","call stability" and "voice quality" as well as "Success rate in data transmission" and "Service quality based on average data throughput".

DEUTSCHE TELEKOM StrategY & Transformation Network, Products & INNOVATION Service & BRAND 21
Network Germany
PRODUCTS & SERVICES

Consumers Business customers Innovation & Partner Services

 Cutting-edge mobile communications and  Information & communication technology (ICT)  Partner for infrastructure access
broadband experience solutions and network services
 TV  Outsourcing & cloud services  Platforms & partnerships
 Smart Home  Intelligent network solutions for the health care, for innovative services
automotive and energy industries

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Overview: B2C, B2B, Partner
PRODUcts & services consumers

Cutting-edge broadband and mobile

communications experience

WiFi Mobile Hybrid router

communications/
Optical fiber/VDSL mobile Internet IP telephony

Entertainment Innovative services

Smart Home

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Products: B2C
PRODUcts & services consumers
EXAMPLE: GERMANY

Service

Cloud Communi-
Cation

MagentaONE
Living Entertain-
ment

Magenta Magenta
Home Mobil

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Products: MagentaONE
Entertainment
FERNSEHEN UND ENTERTAINMENT-DIENSTE
TV Entertainment-Dienste
Music Streaming StreamOn :
 Music and video streaming without burdening
 Präsenz Deutsche Telekom your own data volume
 Präsenz Deutsche Telekom  125 partner services for music streaming,
mit (IP)TV-Angebot
60 partner services for video streaming

 TV in D/Europa, 9 countries in total MagentaMusik 360:

 >7 million TV customers  Concerts in live stream online, via App
and on EntertainTV
 Numerous perspectives for
EntertainTV in Germany:
a 360-degree experience in high definition
 TV with around 300 channels (>100 HD channels)

 Access to over 100,000 on-demand content from multiple partnerships

Virtual Reality:
 Exclusive content for EntertainTV series and Telekom Sport  Contents from entertainment, music
 Attractive UHD content for an even more brilliant image and sport with Magenta VR-App
 Entertain TV mobile: TV on tablet, PC and smartphone  Partner offers from Red Bull, National Geographic
and Twentieth Century Fox

DEUTSCHE TELEKOM: PROFIL STRATEGIE & TRANSFORMATION NETz, PRODUKTE & INNOVATION SERVICE & MArke
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Produkte: Entertainment
SMART HOME

Smart Home – Home control on the move

With Magenta SmartHome from Telekom, you can enjoy the feeling of always having
everything under control at home:
control your lights, heating, and many other electrical devices conveniently with your
smartphone/tablet – from anywhere, at any time.

 Makes your home more convenient, more secure, and more

energy efficient
 Simple to install and intuitive to operate
 Smart Home app as a mobile control center
 Portfolio expanding continually
 Intelligent networking of the various components
 Individual, flexible expansion with the modular portfolio
 Meets highest data privacy and data security criteria
 Wide range of compatible components from different manufacturers
 Based on QIVICON, the multi-brand platform for home control systems

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Products: Smart Home
PRODUCTS & Services for business customers

Information
& communication technology
solutions (ICT) Intelligent network solutions

ICT expertise Dynamic IT access Automobile

& cloud portfolio (cloud computing)

Collaboration Mobile company Energy Health

(cloud services)

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B2B
SERVICES FOR BUSINESS CUSTOMERS

Security Reliability Transformation Flexibility

 Data is subject to German  Failure safety (24/7 availability)  Optimization of networks, servers,  Parallel use of private and public
data privacy regulations  Access from every location must be and applications services
 IT infrastructure is ensured at all times on an end-to-end  Cloud integration and migration  Integration of the various
protected against attacks basis  Improvement of user experience virtualization methods
 Backed-up networks and  Comprehensive sourcing and
secure access line management of hybrid landscapes
 Integration of in-house services as
Drive innovation
required

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B2B
T-Systems – performance

Worldwide deliverability
Managed seats worldwide Approx. 1,215 million
Number of data centers (globally) 32 data centers (DCs)
Gross DC space (m2) 89,425 m²
Twin-core DC 16 twins
Help desk in 21 countries

Scalable platforms
Systems on standard 53,893
MIPS 137,850 MIPS
Storage 307,370 TB
SAPS +85 million SAPS
SAP users +3.8 million users
as of: Q2/2017

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B2B
T-Systems - Pioneer IN CLOUD COMPUTING

▪ T-Systems has been offering solutions via dynamic

platforms for more than ten years
▪ More than 36,000 cloud systems worldwide in operation
▪ More than 300,000 employees in customer companies
communicate via T-Systems' Dynamic Services for
Collaboration
▪ Germany's biggest data center is in Biere and covers an
area of 22,000 square meters
▪ Focus on security: systems are subject to German data
privacy regulations

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B2B
Partners - PARTNERS
T-SYSTEMS

Strategic partners (examples)

▪ Partnerships with global technology leaders

▪ Certificates and exclusive partnerships
▪ Close partnership and collaboration

DEUTSCHE TELEKOM: PROFIL STRATEGIE & TRANSFORMATION NETWork, Products& INNOVATION SERVICE & MArke
T-Systems International GmbH May 2016 31
B2B
Innovation at deutsche Telekom
we follow 3 basic principles
Portfolio & Innovation Board Corporate Innovation Fund 4+1 Priorities in Innovation

Connectivity Home

Internet of Things digitization of Sales & Service

5G / Low Latency

collaboration agility Focus

Business units work together Speed & FLEXIBILITY LONG-TERM STRATEGIC Initiatives
across divisions Through FINANCIAL Stakes

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Innovation
... In cooperation with
partners worldwide
Group Partnering hub:raum T-Labs

Promoting innovation worldwide Innovation transfer from the world of start-ups Research from the world's best universities

Increase in revenue and differentiation through Early development of new business ideas. Continuous Developing feasible ideas - T-Labs identifies relevant
complete integration into Deutsche Telekom’s ‘scouting’, start-up programs, strategic investments approaches from the academic world
product and development processes

time to market

short term long term

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Innovation
Examples
WE Address all Dimensions of Innovation
Smart Home NB-IoT 5G / Low Latency

True integration at home Industry-level connectivity Infrastructures of the Future:

Tactile Internet & Edge Computing Ecosystem
Realization of the vision of a seamlessly networked Development and standardization of a wireless NB-IoT Extremely short license times (e. g. availability,
home network for a variety of applications (e. g. containers, reliability) and examples of future real-time applications
parking meters etc.)

time to market

short term long term

DEUTSCHE TELEKOM: PROFILE STRATEGY & TRANSFORMATION NETWork, Products& INNOVATION SERVICE & BRAND
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Innovation
DEUTSCHE TELEKOM COMPANY PRESENTATION
OVERVIEW

01 Deutsche Telekom
02 Strategy & Transformation
03 Network, Products & Innovation
04 Service & Brand

35
BEST CUSTOMER SERVICE
EXAMPLE: Germany
Awards for customer service
 Awarded regularly: TÜV technical inspection
service’s ”good“ seal for customer service
 European Business Award: EU accolade awarded
for excellence and an innovative and successful
business model throughout Europe

Customer service Technical service

90 million customer contacts per year 17,842 technical service employees
68,4 million phone calls per year
20 million letters/faxes/e-mails per year
 Customer service in Web 2.0:
Daily workload (ø):
”Telekom helps“ on Facebook and Twitter  25,000 customer lines provisioned
feedback platform  18,000 customer contacts by phone

 Customer service in App: MagentaService  7,000 on-site installations

App and DSL Help App  19,000 customer line faults cleared

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Best Customer Service
 UNSERE MARKENPOSITIONIERUNG ERLEBEN, WAS VERBINDET
OUR BRAND POSITIONING
LIFE IS FOR SHARING

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Brand Positioning
 UNSERE MARKENPOSITIONIERUNG ERLEBEN, WAS VERBINDET
OUR LIFESTYLE BRAND
Let‘s fall in love with Magenta
Magenta – so much more than just Deutsche Telekom‘s company colour –
it‘s the most important element of our brand experience.

But we‘re taking it a step further because Magenta has become a real attitude
and our way of living. With our lifestyle products our employees show their
brand pride also beyond the company walls.

In our shop we display our favorite colour : sometimes bold, sometimes

low-key - but always stylish and up to date.

lovemagenta.com

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Brand
THANK YOU