The collaboration would involve the formation of a joint venture to facilitate closer collaboration between the two companies on fixed line and mobile services

Deutsche Telekom and United Internet are close to an agreement that would see the pair jointly develop their full fibre networks across Germany.

The announcement comes after United Internet publicly stated its intention to bid in Germany’s forthcoming 5G auction. This prompted DT’s CEO Tim Hottges to suggest that the company form a joint venture to share the investment costs of rolling out fixed line fibre and next generation mobile networks.   

“Wide-coverage fibre-optic networks can not only connect households but are also the basis for the future connection of powerful 5G antennas," explained Ralph Dommermuth, CEO of United Internet AG.

Deutsche Telekom had proposed that the pair enter into a 50:50 joint venture agreement to provide 5 million fibre to the home (FTTH) connections across the country. However, United Internet’s chairman pointed out that, due to his company’s smaller customer base, it would only be able to proceed as a minority partner in the JV.

“I welcome the offer of Mr. Höttges to jointly provide over 5 million households with fibre-to-the-home (FTTH) connections and can confirm our wish to participate. In the interests of our two companies, and above all in the interests of the German people, it is right for Germany’s two largest suppliers to join forces and provide this important future technology together. However, I’d like to qualify the 50:50 investment ratio proposed by Mr. Höttges: our DSL customer base is only a third of the size of Deutsche Telekom’s and as a result we won’t be able to utilize the capacity of the new networks to the same extent. But we’d be happy to invest in a ratio which fairly reflects our market share – that would result in a 75:25 joint venture,” he said.

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