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  • 2016 Corporate Responsibility Report
2016 Corporate Responsibility Report

Infrastructure expansion

Our network infrastructure enables economic performance and participation in the knowledge and information society. As a result, demand for faster, full-coverage data services is immense. That is why we continue to rapidly expand our infrastructure and improve transmission speeds with new, secure technology.

Expanding our infrastructure

The data volume generated globally will increase tenfold by 2020 compared to 2013, according to a study conducted by US-based IT company EMC. That would mean 44 billion gigabytes in the networks a year instead of 4.4 billion. The amount of digital data being produced in Germany alone is expected to grow from a current 230 billion gigabytes to 1,100 billion. Networks need to be continually expanded to be able to handle this volume.

We have been the largest investor in this area in Germany for years now and will continue to drive network expansion. The main objectives of our pan-European integrated network strategy (INS) form the basis for these activities: growth, efficiency and quality. We will continue to expand our networks, increase the efficiency of our systems and further strengthen our role as a leader in network quality. Our integrated network strategy is in line with the network expansion goals specified by the EU Commission and the German federal government (digital agenda and broadband strategy).

Network expansion based on four pillars
Deutsche Telekom's integrated network strategy (INS) for Europe is based on the four pillars LTE img, fiber optics, VDSL img vectoring and hybrid. In addition to expanding the LTE mobile network, fiber-optic expansion in combination with VDSL vectoring technology is the short and medium-term focus of Deutsche Telekom's INS for Germany.

Integrated network strategy

We have defined two targets in implementing our INS in Germany that we plan to have achieved by 2018. We expect to be able to provide 95 percent of the population with LTE img. Secondly, progress of the fiber-optic network roll-out should allow VDSL img vectoring lines with bandwidths of at least 50 Mbit/s img for around 80 percent of all households. This is subject to regulatory changes.

Upgrading our network architecture
We intend to make our networks faster and more efficient. To do this, we are going to deactivate all analog PSTN (public switched telephone network) platforms that we no longer need and switch our entire telephone network to IP-based lines by 2018. Thanks to this switch and other measures to improve efficiency, Deutsche Telekom will reduce the carbon footprint of its fixed and mobile networks in Germany by around 40 percent by 2020 compared to 2008. The switch to IP img technology, which requires considerably less energy compared to earlier network technologies, will contribute significantly to the overall reduction of CO2 emissions.

We will also rely on fiber optics when updating our network architecture in order to meet our customers' demands for fast network connections. Using the fiber optic-based VDSL vectoring technology speeds up download data transmission rates to up to 100 Mbit/s and even up to 40 Mbit/s when it comes to upload transmission rates. But vectoring requires more energy. We are working on control solutions for energy-efficient operation of our facilities in order to decrease the amount of energy required. The combination of IP technology and VDSL vectoring is already considerably more energy-efficient than conventional PSTN technology.

Progress

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New mobile communications standard: network revolution, instead of evolution

The current LTE img mobile communications standard is a fourth generation standard (4G). The possibilities of this standard certainly have not yet been fully exploited. LTE is continually developing and can fully meet the requirements of consumers for ever greater bandwidth. However, the successor to the LTE standard, 5G, is already taking shape. Industry experts are intensively discussing which elements will be included in this new standard. The goal is to agree on a uniform global definition of 5G. Many companies share our belief that 4th generation LTE technology will most likely remain as part of a future 5G standard. 4G will, in a way, form the foundation of 5G performance. This will allow us to meet the growing requirements of consumers in the future as well.

However, 5G will be able to do much more: the new functions will be interesting first and foremost for industry. They will facilitate new business models that aren't even conceivable based on current standards. This includes innovative solutions for the health or automotive industry. All in all, this next generation will provide 1,000 times higher capacity depending on the application, 10 times better speed, ten times faster response time (latency) and 1.5 times better mobility in comparison with conventional technologies.

At the Mobile World Congress in Barcelona in spring 2016 and at other venues, we presented development steps on the road to 5G: the first fully functional end-to-end 5G network worldwide. In addition to high transmission rates, the model achieved minimized latencies of less than one millisecond. In comparison: top latencies achieved with LTE are currently 40 milliseconds.

Continuing expansion of the fiber-optic network

Telekom already operates the largest fiber-optic network in Europe with more than 400,000 kilometers. However, demand for higher bandwidths is constantly increasing. In view of this trend, we continue to expand our fiber-optic network in order to secure our business success in the long term. Our goal is to provide 80 percent of Germany's population with a minimum of 50 Mbit/s img by 2018 – subject to regulatory changes.

To reach this goal, we are using FTTC img (fiber to the curb) technology and are expanding FTTH img as well. With FTTC, fiber optics are laid to the gray cable distribution boxes on the curb. From there we can supply our customers with large bandwidths via existing lines by means of VDSL img vectoring. With FTTH, or fiber to the home, the fiber-optic cables are taken into the home.

  DSL img 16000 FTTC with VDSL vectoring FTTH
Download up to 16 Mbit/s up to 100 Mbit/s up to 200 Mbit/s
Upload up to 2.4 Mbit/s up to 40 Mbit/s up to 100 Mbit/s

Continuing buildout of the LTE mobile network

We continued to expand our use of LTE img mobile network technology in the Deutsche Telekom network in 2016. In late 2016, average network coverage was at 84 percent of the population, putting our European national companies in line with their target coverage. Network coverage at the end of 2016 was just below 92 percent of the German population. Our goal is to achieve 95 percent by the end of 2018. Around 75 percent of European transmitter masts are currently equipped with LTE. Two or more frequency bands are active in almost every fourth LTE location, ensuring more extensive reach and higher speed.

Speed breakthrough of one gigabit per second
Together with device manufacturer Huawei, we broke through the speed barrier of one gigabit for mobile data transfer in the LTE network in 2016 for the first time. Using Deutsche Telekom's mobile network, we achieved the breakthrough with a transmission rate of 1.22 gigabit in a live demonstration in Berlin. The latest LTE Advanced Pro technology was used for the test. The technology combines at least three frequency bands to achieve high speeds.

Fast Internet access on board

Deutsche Telekom and Inmarsat are planning to provide airline passengers in Europe with even better Internet access on airline flights. The companies are currently establishing the European Aviation Network (EAN) within the scope of a strategic partnership.

We installed the first LTE img sites in England in 2016. A total of around 300 new LTE base stations will be set up in Europe for the EAN.

The first successful test flight took place in the UK in November 2016. The connections were stable during numerous transitions between mobile base stations. This result exceeded expectations and provided the development team with valuable data.

After the current test flight program has been finalized, the EAN will be available by mid-2017.

Pan-European network (Pan-Net) is taking shape

To date, our European national companies operate their own infrastructures and develop their services independently. The switch to IP technology - to be completed by 2018 - however, will make it possible to develop new services together and share them across borders. We hope to tap into this potential by creating a pan-European network.

Individual services such as text messages, voicemails and e-mails will be made available to all countries in the pan-European network as "product building blocks." Our Pan-Net cloud will serve as the basis. Every national company can then use the building blocks to create an offer that suits their local market and customer requirements. We can also use this technology to offer new solutions throughout Europe within just a few days.

In 2016 we opened our first "production site" for Pan-Net services in Hungary. The site is now the first cornerstone of our pan-European network. We founded a new company for management and control of the new infrastructure in 2015: Deutsche Telekom Pan-Net in Slovakia. We plan to add two further sites in Poland and Greece in 2017.

Switch to IP technology advances

We are working on switching our telephone network to IP-based lines by 2018. Thanks to IP img technology phone calls are no longer transmitted via analog channels or using ISDN img technology but in the form of data packets, a method that has been the standard in online and mobile communications services for some time now. Energy use with IP technology is considerably lower than with the network technology previously used. The switch therefore also helps us decrease our CO2 emissions.

We reached a key milestone at the end of 2016 when we finished switching half of our lines – around twelve million – to IP. After placing our focus on switching private customer lines for some time, we began increasingly focusing on business customers in 2016. Of 3.5 million business customer lines in Germany, more than one million had been switched to IP by the end of the year.

In the other EU countries we also increased the number of IP lines. In Croatia, Montenegro, Macedonia and Slovakia, all lines have already been switched to IP. Hungary will follow in mid-2017. The plan is to complete the switch in Greece, Romania and Germany by 2018.

Award for mobile network in Germany

Connect fixed-line test (08/2016): Test winner
We were the only Germany-wide provider to receive the overall rating of "excellent" in August 2016 in the fixed-line test carried out by German trade magazine Connect. Whether it be telephone services, Internet or online television, we beat out the competition.

CHIP mobile network test (1/2017): First place
In the mobile network test carried out by trade magazine Chip, we not only won in the "Overall network quality" category but also in the "LTE img network quality" category. Testers were particularly impressed by our network availability of 95 percent. Our network was not available in only 5 percent of cases..

Connect mobile network test (1/2017): Again first place
We won the mobile network test carried out by trade magazine Connect for the sixth time in a row. The test focuses on the categories voice and data. We were the only company to be rated "excellent".