Deutsche Telekom and France Télécom will shop together

Large investments and pressure on tariffs force operators to think outside of the box

Deutsche Telekom and France Télécom are joining forces to increase their collective buying power, and negotiate better deals on mobile networks and smartphones. The two network operators will pass some of the savings they hope to realize on to their customers, they said Monday.

The two companies have agreed to form a joint venture later this year to buy smartphones and equipment for their respective mobile networks. At a later stage, they will also buy hardware and software for their internal IT infrastructures, beginning with pilot projects for servers and storage. Between them, the companies expect to save around €1.3 billion (US$1.9 billion) per year after three years through economies of scale and operational synergies.

Savings passed on to subscribers could come in the shape of lower tariffs and cheaper smartphones, but it is too soon to announce any details, the two said during a conference call.

The joint venture is an example of how mobile network operators are looking for ways to cut costs as they face increasing pressure on tariffs and the need for big investments in technologies such as LTE (Long-Term Evolution) network infrastructure . Deutsche Telekom expects operators will invest more than ever in networks and infrastructure as data usage continues to increase and mobile networks are expanded to offer broadband service in rural areas.

Winning deals with the joint venture will be more important for network equipment and smartphone vendors. Before, if a vendor lost a bid for Deutsche Telekom's business, it could still bid for Orange's. Now such deals could become all or nothing, increasing price pressure on vendors.

This isn't the first time Deutsche Telekom and France Télécom have worked together. In September 2009, the two operators pooled their U.K. mobile networks in a joint venture called Everything Everywhere. In February this year they announced plans to find new areas of cooperation, including radio access network sharing in Europe, Wi-Fi roaming and machine-to-machine (M2M) services. The purchasing joint venture, which will have offices in Bonn and Paris, is the latest fruit of those plans.

Send news tips and comments to mikael_ricknas@idg.com

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Mikael Ricknäs

IDG News Service
Topics: business issues, telecommunication, Carriers, deutsche telekom, France Télécom
Comments are now closed.

Latest News Articles

Most Popular Articles

Follow Us

GGG Evaluation Team

Kathy Cassidy

STYLISTIC Q702

First impression on unpacking the Q702 test unit was the solid feel and clean, minimalist styling.

Anthony Grifoni

STYLISTIC Q572

For work use, Microsoft Word and Excel programs pre-installed on the device are adequate for preparing short documents.

Steph Mundell

LIFEBOOK UH574

The Fujitsu LifeBook UH574 allowed for great mobility without being obnoxiously heavy or clunky. Its twelve hours of battery life did not disappoint.

Andrew Mitsi

STYLISTIC Q702

The screen was particularly good. It is bright and visible from most angles, however heat is an issue, particularly around the Windows button on the front, and on the back where the battery housing is located.

Simon Harriott

STYLISTIC Q702

My first impression after unboxing the Q702 is that it is a nice looking unit. Styling is somewhat minimalist but very effective. The tablet part, once detached, has a nice weight, and no buttons or switches are located in awkward or intrusive positions.

Resources

Best Deals on GoodGearGuide

Compare & Save

Deals powered by WhistleOut
WhistleOut

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?