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Deutsche Telekom AG - Interim Group report - January 1 to September 30, 2011

10 Group strategy and Group management. Group strategy. Fix – Transform – Innovate. We have been successfully implementing our strategy since March 2010. Telecommunications is an industry that sees per- manent, dynamic change and is influenced by global trends. All relevant areas are affected: the fixed network, mobile communications, and the Internet. Infrastructure is and will remain the basis of our business. We expect the gigabit society to need faster and faster networks. Two factors are of crucial importance here, if we are to be efficient and successful: next-generation networks and standardized IT. Telecommunications providers will also have to focus increas- ingly on realizing growth potential. In our opinion, the mobile Internet and Inter- net services, for example, provide a wealth of growth opportunities. What do customers expect? Secure and universal access to all services – from all devices. In our view, cloud computing and dynamic computing provide considerable growth potential for business customers. Furthermore, intelligent networks will in future support the upcoming changes in industries such as energy, health- care, media, and transportation/automotive. We still firmly believe on the whole that a strong national competitive position is vital for a profitable business. We are systematically refining our strategic approach based on the Fix – Trans- form – Innovate strategy presented in March 2010. We are focusing specifically on the challenges and opportunities in the market, which will safeguard our successful position in the long term. Our vision is still to become an international market leader for connected life and work. This is why we will systematically restructure our business model in the coming years - with investments in intelligent networks, with IT services and with Internet and network services. The aim of this strategic approach is to expand our activities across the entire value chain and position ourselves as an open partner for consumers and business customers as well as for the Internet sector. We have defined five strategic action areas: −− Improve the performance of mobile-centric assets. −− Leverage One Company in integrated assets. −− Build networks and processes for the gigabit society. −− Connected life across all screens. −− Connected work with unique ICT solutions. We are systematically implementing our strategy within these action areas and have achieved initial successes in all areas. Improve the performance of mobile-centric assets. In all countries in which our operations primarily provide mobile communica- tions services, we are planning to enhance our performance and specifically invest in next-generation technologies, develop innovative services, and expand our portfolio of mobile devices. In the United Kingdom, for instance, our new joint venture Everything  Everywhere got off to a good start as the market leader, measured in terms of the combined customer base. In Poland, we have definitive clarification of the ownership of our subsidiary PTC. The agreed sale of T-Mobile USA to AT&T represents achievement of a central goal of our strategy. This transaction will free up resources, which will allows us to strengthen our focus on the transformation in Europe, and will also impact positively on the development in the mobile-centric markets. Leverage One Company in integrated assets. We are continuing to integrate fixed-network and mobile communications – an approach we had taken under the One Company project – as planned. On the back of the successfully completed integration in Germany and several Euro- pean markets (e.g., Croatia and Slovakia), we can generate additional revenues, further improve our customer service and leverage synergies. We have also reorganized our activities in Europe since 2009, making excellent additions to the management in the national companies in Europe. And all this has borne fruit: EBITDA margins in the integrated markets are still at a high level despite the continuing challenging economic situation in some countries. New innovative services and rate plans have allowed us to set ourselves apart from our competitors more clearly. Media Center, for example, already gives our customers 24/7 access to their music, photos, and other media content, whether on their PCs, TVs, or smartphones. LIGA total!, Deutsche Telekom’s soccer league service in Germany, can likewise be watched on various screens at home or on the move.