One building block of our integrated climate strategy is to analyze the sustainability benefits of our product portfolio. In 2014 we began analyzing our portfolio together with external experts based on sustainability criteria (analysis). We measure the result with the Sustainable Revenue Share ESG KPI. The share of such products was already at 40 percent in 2017 (excluding T-Mobile US).
40% of revenue with products and services that offer sustainability benefits
Examples of sustainability benefits include reduced CO2 emissions thanks to virtual meetings instead of business trips, improved medical care by means of e-health solutions and resource conservation by replacing physical devices with digital solutions (e.g. phoning via a laptop instead of a fixed-line phone).
Overall, we have carried out in-depth analyses for 17 product groups with regard to their sustainability benefits and the corresponding business potential (as of year-end 2017). We have illustrated the benefits of some selected products based on all three pillars of sustainability (ecological, social and economic).
To date, there is no industry-wide established system that provides customers with sustainability information about ICTproducts and services. We have started to create just such a system using our product analyses – that is, to find out which sustainability contributions our products can make at all. Future plans also include keeping our customers better informed of these sustainability benefits, thereby sharpening our competitive edge.
Machines and products are becoming increasingly intelligent. Cars can communicate with repair shops, containers with logistics service providers. The technology that makes this possible is called machine-to-machine communication, or M2M. By 2020 the number of M2M connections around the world is expected to increase to 2.5 billion. Machine-to-machine communication is an important area of growth for us.
M2M can help ideally coordinate the processes of various devices, vehicles and entire industrial facilities. This helps increase industrial productivity, ensure efficient logistics, reduce energy consumption and conserve resources.
We also support the German federal government's Industry 4.0 initiative through our involvement in machine-to-machine communication. The initiative's objective is to maintain Germany's competitive edge in the technology sector.
New wireless technology allows for innovative applications
Our networks are the basis for a number of M2M applications, as mobile network technology is the key transmission channel of every M2M connection. In this respect, the NarrowBand Internet of Things (NB-IoT) is gaining significance. As opposed to broadband applications, which enable transmission of large amounts of data, narrowband technology is specifically designed to reliably transfer very small data packages. Benefits of NB-IoT include its low energy requirements, extensive reach and low-cost device networking. NB-IoT is particularly suitable for use in logistics. When tracing transport containers, all that is needed is for the current position to be transferred about once an hour. Only very small amounts of data need to be transferred in small data packages – and not necessarily in real time. NB-IoT is even used for protecting biodiversity, in a technology that beekeepers can use to protect their bees.
We were pioneers in aiding the development of uniform NB-IoT standards and continue to drive it. NB-IoT is now available in more than 600 locations in Germany. More than 200 of our business customers in various sectors use this technology (as of year-end 2017). We are also leaders in the launch of NB-IoT in Europe and North America: we are already active in seven European markets and the USA with the technology. Our narrowband network should be available nationwide in the USA and in many European countries by the end of 2018.
The port of tomorrow
In 2017 we continued our involvement in the smartPORT logistics (SPL) pilot project for the port of Hamburg. The goal of the project is to improve HDV traffic flows at the port of Hamburg and in its vicinity. All relevant traffic and infrastructure data is collected and analyzed in real time for this purpose. Results can be used to inform users about waiting times, alternative routes or parking. The project is increasingly being integrated into commercial operation.
EU project AEOLIX: A platform for more efficient and climate-friendly logistics chains
The port of Hamburg is a part of the EU project AEOLIX. The goal of this project is to build a new ICT platform that networks numerous, previously isolated individual logistics systems across the EU. At the same time, practical services will be developed and tried out in 11 European test zones. T-Systems is participating in test zone 1: Intermodal Logistics in the Hamburg – Frankfurt Transportation Corridor. This zone will test a smartphone app that helps truck drivers drive in an ecologically responsible manner. Some 958,230 metric tons of CO2 could be spared in ongoing customer projects MAN Telematics and SchmitzCargoBull Telematics as well as in additional new projects (e.g. AEOLIX) by analyzing driving profiles and ecodrive functions. The project will run until 2019.
AUTOPILOT – autonomous driving services for more efficiency
The goal of the EU project AUTOPILOT is to test autopilot services on the market. This also includes self-driving cars in short-distance traffic, self-parking cars and real-time car sharing. Such solutions are particularly efficient and environmentally friendly, resulting in an estimated 10 percent fewer CO2 emissions as compared to conventional driving practices. The project will run from 2017 to 2019. Thereafter the services will be incorporated into regular operations. T-Systems is the project partner of AUTOPILOT and supports analyses on the feasibility and market launch of the new services.
Connected Car: Preventing traffic jams with connected cars
T-Systems has been developing and operating Daimler's Connected Car platform (Daimler vehicle backend) worldwide since 2013. The platform is the technical basis for the Live Traffic service, which provides drivers with real-time traffic information, thereby helping them avoid traffic jams. Live Traffic prevents about 30% of traffic jams per vehicle. This means that the approximately 5 million vehicles equipped with Live Traffic consumed about 6.2 million liters less fuel. This translates into CO2 savings of about 15,000 metric tons.
A uniform telehealth platform permits cross-case, standardized data sharing among healthcare providers. Telemedicine assistance systems can support patients and their families in everyday tasks, help bridge long distances to medical personnel and optimize the care process. We are helping shape the digital healthcare system with numerous pilot projects.
Sustainable products are a key factor in competition for us. In order to inform our customers about the sustainability benefits of our products, we rely on recognized ecolabels, such as the Blue Angel in Germany. The majority of fixed-line phones and some media receivers boast the Blue Angel label. In 2017 the Media Receiver Entry and the Media Receiver 201 also received the Blue Angel. End devices certified with this ecolabel also contain information for customers as to how the products can be used in an energy-efficient manner. In addition to the Blue Angel, we have also increasingly been using the TÜV Green Product Label. This label exceeds the Blue Angel criteria in ways such as requiring inspections of working conditions at production sites. A number of our routers, including the Speedport Neo, have already been certified by the TÜV Green Product Label.In addition to ecological criteria, TÜV Green Product Label also provides for a review of working conditions in production plants.
The labels not only serve as information for our customers, however. Their strict requirements also help us see how we can further improve our products.
We also keep our goal of reducing our carbon footprint in mind when planning and operating our data centers. To achieve this goal, we take a two-step approach. It starts with optimizing energy consumption at each data center site and then continues with improving processes throughout the global data center landscape.
The key indicator for increased energy efficiency at our data centers is the PUET-Systems data centers in Germany from 1.85 to 1.54 between 2008 and 2017. In comparison with the previous year, the figure remained constant in 2017. The reason for this is the ongoing consolidation of the data centers, where applications from less energy-efficient sites are migrated to new, highly efficient data centers. This increases the PUE value of the decommissioned data centers in the short term. Overall, this process lead to a constant PUE value across all data centers in the reporting year.factor. We were able to reduce the average PUE factor at the
The DC11@2018 program for improving processes throughout our global data center landscape has been up and running since 2013. The project combines physical data center consolidation (i.e., reducing data center space and sites) with logical consolidation (i.e., virtualizing data center infrastructure). The objective of the DC11@2018 program is to consolidate global data center capacity at FMO (future mode of operation) data centers using the latest IT technology. In 2017, we continued to remain on schedule with this program. Within the scope of the physical consolidation, we decommissioned three old data centers in Germany. At the same time, we further optimized air conditioning in the existing data centers in Biere and Munich.
The target average PUE factor at all FMO data centers in the Group will be 1.4 once the program has been completed in late 2018/early 2019. At the end of 2017, we were already at a PUE value of 1.51. This requires a homogeneous IT landscape combined with optimum capacity utilization of data center infrastructure, IT hardware and the software running on the systems. For the year 2020, the latest program plans indicate accumulated reductions in CO2 by up to 51 percent compared to 2012.
Our target PUE factor for our highly efficient data center in Biere is 1.3. To achieve this target, it will be necessary to respect a given temperature level and to achieve a capacity utilization of at least 80 percent. We were not yet able to achieve the PUE target value in 2017.
We want to make sure that used routers and media receivers don't just end up in the trash. That is why we promote the "Don't buy, rent" approach. Our rental services conserve resources, reduce electronic waste and prevent CO2 emissions. Customers return the devices if they cancel their contract. The devices are then either refurbished and rented out again or properly recycled. We have simplified the return process by introducing a returns portal. The online portal enables customers to manage their own returns. We actively and effectively promote the rental service in many ways including at Telekom Shops, online, via customer service and in product flyers. The offer has been well received by our customers; the number of people using the rental service increased to around 9.5 million by the end of 2017.
Germany's recycling and reuse rate for small electronic appliances is too low. Too many used cell phones, smartphones and tablets are stuck in drawers or disposed of illegally with the household waste. But these devices should be refurbished and reused or properly recycled to help us conserve valuable resources. We have been offering different ways for people to hand in their devices since 2003. Customers have been able to return their used, high-end cell phones and smartphones to Telekom Shops under a buyback program since 2013. They receive store credit from the Telekom Shop reflecting their old device's current value, which they can use to purchase a new device, or they can choose to have the amount booked to their customer account. Business customers can send in their used cell phones and smartphones through a buyback portal (www.handyankaufsportal.de) for business customers, which we created in 2016. After the device's value has been determined, the amount can be paid out or donated to a charitable organization. Together with company Teqcycle Solutions we also operate the Cell Phone Collection Center online portal. Through this portal, authorities, associations and other organizations have the opportunity to start collection campaigns for donating used cell phones and smartphones. The website provides an overview of these partners and the collection campaigns they conduct. Such campaigns took place in Bavaria and North Rhine-Westphalia during the reporting period. We also welcomed two new cooperation partners in 2017: the Frankfurt Zoological Society and Pro Wildlife e.V. At the end of the year we donated the proceeds from the devices collected through recycling and reuse to environmental organization Deutsche Umwelthilfe e.V.
In 2017 we joined together with radio station Antenne Unna to hold a cell phone collection competition between the communities of the region. The station followed the various collection campaigns and crowned one of the communities the victor. The objective of the competition was to increase listeners' awareness of environmentally friendly resource consumption. The proceeds from the sales and recycling activities were donated to the Lichtblicke e.V. charity.
In 2017 we collected exactly 148,888 used cell phones and smartphones throughout Germany and either reused them or had them properly recycled. During the cell phone collection campaign we use a data deletion process that is DEKRA certified and complies with strict data protection requirements. Defective cell phones or devices where certified data deletion would be too costly are properly recycled using state-of-the-art, environmentally friendly processes at the Telekom Recycling Center in Goslar. Up to 100 percent of the materials can then be reused – as recycled metals or for energy generation.
We depict the relationship between commercially sold and collected mobile phones with our Cell Phone Collection ESG KPI.
We map the relationship between mobile devices brought onto the market and taken back with our ESG KPI "Take-back mobile devices". In 2017, approximately 317,000 mobile devices (excluding T-Mobile US, AMC, Maktel, Crnogorski) were taken back throughout the Group.
Support of various collection campaigns As in previous years, we supported the Die Handyaktion campaign conducted by different church-affiliated groups in the state of Baden-Württemberg in 2017 as well. This time the partners reinforced the campaign, together with the German Mineral Resources Agency and the Ministry of the Environment of Baden-Württemberg, with various educational measures. For example, they redesigned the "cell phone raw materials kit" for school classes. The kit contains various minerals that are used in cell phones. Using accompanying teaching materials, teachers can explain the significance of the raw materials in smartphones to their students.
The Responsibility and Sustainability. Join in! collection campaign in the state of Saarland, which we have been supporting since 2014, was extended until the end of 2018 due to ongoing interest. We are still a cooperation partner to the campaign, which focuses on projects such as providing special course material on the topics of cell phone collection and resource efficiency. Mutual cell phone collection campaigns with Saarland companies and institutions are a further focus.