Chairman of the Deutsche Bundespost Telekom Helmut Ricke was in the UK earlier this month to open the London office of Telekom and announce an increasingly global role for the company, spun out from the German Ministry of Posts and Telecommunications in January. Ricke said that the decision to open the London office was taken back in 1989 when Telekom was still under Ministry control, but that the opening fits in with the state-owned corporation’s plans to enter the global communications market. It opened an office in New York earlier this year and it also has bases in Paris, Brussels and Tokyo. British Telecommunications Plc has had a Frankfurt office for three years and recently opened another in Bonn. Ricke admitted that, compared with BT’s endeavours we are arriving late to the British market. He stressed that the company, which still has a state monopoly on fixed line services in Germany, intended to become more cost-sensitive and market-orientated. One example is the aim to provide one-stop-shopping services for customers with global interests. To this end the UK office will be seeking partners for co-operation in the provision of global services. This year Ricke expects turnover of Telekom to reach $26,656m, with profits of around $16,954m – before the UKP9,800m subsidy that Telekom still has to provide to cover the losses of the Bundespost and Postbank – strange how the super-efficient Germans can’t run a post office or postal bank profitably. Ricke said he expected both to be breaking even by 1995 – the UK Post Office has made profits for years. Merging with the former East German Posts & Telecommunications authority has proved less of a liability than being tied to the Post Office and Postal Bank, as the telecommunications tariffs in East Germany were set at realistic levels. Over the next seven years Telekom is to invest $15,680m in East Germany, installing around 6.5m lines in order to bring the penetration of fixed lines to Western levels. At the moment there are 1.8m lines in the former East Germany which has one of the worst phone systems in the Eastern Bloc. The cash will be borrowed on the German and international money markets so as not to stress telephony tariffs in the West. Ricke could not say when he expected a return on the investment, but he was confident that it would prove fruitful. 60% of the east is covered by cellular communications at 450MHz and Telekom intends to keep the cellular penetration up with fixed lines..pl 72
