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Deutsche Telekom AG - Interim Group report - January 1 to March 31, 2011

11Interim Group management report Build networks and processes for the gigabit society. We are forecasting a rapid increase in global data volumes in the coming years. Our goal is therefore to continue to transform operations by becoming more efficient, but also by supplying the greater bandwidth required. For this reason, we are focusing on: −− rolling out the fiber-optic networks and enhancing the mobile communica- tions networks by pushing HSPA+ and LTE −− systematically implementing the all-IP concept −− increasing the speed and flexibility of the IT factory −− systematically expanding key enabling skills. We have already started out on the path to achieving these goals. We purchased additional mobile frequency spectrum in several countries, including Germany, the Netherlands, and Austria. We made further progress with our network roll- out and put more than 3,000 additional UMTS sites into operation in Germany in 2010. On top of this, we have started to roll out the LTE network in several countries. We are also expanding our networks on the fixed-network side. Our billion- euro investments ensure that more and more households will be covered by fast broadband lines. Put into figures: We have marketed around 12 million broadband lines in Germany, which makes us market leader. On top of this, well over 300,000 customers have already opted for a VDSL line from Deutsche Telekom. Connected life across all screens. One strategic goal is the provision of innovative, non-device-specific and con- vergent services. In our view, the greatest opportunities for growth lie in making data services mobile, particularly on the mobile Internet. We are marketing our own key solutions for connected life, such as innovative communication ser­ vices centered around the personalized, network-based address book that we have successfully launched on the market in five countries (e.g., myPhonebook in Germany). Needless to say, we also place a great deal of emphasis on ensur- ing that our customers have attractive handsets. Initial sales of smartphones have been strong. Around 50 percent of all handsets sold in Germany are smartphones. Deutsche Telekom is also positioning itself as a pioneer for digital content, by linking and distributing personalized media content. We have made some targeted acquisitions (e.g., ClickandBuy and STRATO), all of which are valuable additions to Deutsche Telekom’s portfolio in the high-growth Internet business. Our prominent position in the European TV market is yet another success factor. By the end of 2010, we had already sold 1.6 million Entertain packages in Germany since market launch and expanded our TV customer base in Southern and Eastern European markets to 2.3 million which corresponds to a 23.0-percent increase against 2009. Connected work with unique ICT solutions. Deutsche Telekom provides customized ICT solutions for business customers and draws on the services of T-Systems in the ongoing standardization of its internal IT solutions. In pursuit of this task, T-Systems will continue to be re- structured and its profitability raised to industry level. T-Systems succeeded in increasing its external revenue from IT services in 2010, with particular gains in international markets. We have developed intelligent, innovative offerings centering around secure cloud services that our business customers are happy to use. We are position- ing T-Systems as an open partner, also for other sectors, with the aim of lever­ aging growth opportunities for ICT solutions in sectors that are undergoing major changes. As part of this initiative, we have created four new business areas for developing intelligent network solutions: energy, healthcare, media distribution, and the connected car. These also got off to a good start. At CeBIT 2010, for instance, we signed an agreement with Continental for the joint development of an open, flexible, and future-proof infotainment concept for connected cars. In addition, we were successful in establishing a partner- ship with ABB to develop smart grids of the future.