Deutsche Telekom’s FTTH joint venture gets underway

News

Deutsche Telekom and utility company EWE have formally established their new joint venture, Glasfaser Nordwest, to build out fibre infrastructure in Germany.

The deal was first announced in December 2017, when the companies signed a non-binding declaration of intent and at the end of last year, they received approval from the Cartel Office.

“Today is a good day for the northwest of Germany. 1.5 million households and business premises are set to benefit from these two strong businesses joining forces. Glasfaser Nordwest is set to bring high-speed connectivity to the cities and across the countryside. And I’m delighted that all our efforts to achieve cooperation have paid off," commented Dirk Wössner, CEO, Telekom Deutschland.

First steps

Deutsche Telekom and EWE plan to invest up to €2 billion into Glasfaser Nordwest over the next ten years. The joint venture is set to remain in place indefinitely. There are suggestions that more such joint ventures could follow.

Glasfaser Nordwest will begin with its build-out effort immediately and fibre-optic connectivity will become available to the first customers in the build-out zone this year.

The joint venture company won’t sell telecommunication services directly to end customers but rather provide EWE, Deutsche Telekom and other telcos with access to the fibre-optic infrastructure under open market conditions. Other businesses can use the infrastructure and run their own products and services on top. 

As well as in towns and cities, Glasfaser Nordwest also intends to connect up areas that have been underserved up until now.

“Entirely uneconomical build-out areas will, however, remain dependent on the support of subsidies. For anti-trust law reasons, Glasfaser Nordwest will not be participating in such work,” a statement said.

The zones to be built-out during the first two years of operation will be set out in advance and Deutsche Telekom and EWE will carry out the upgrading work. After this period, Glasfaser Nordwest will also offer the build-out areas for bidding on the open market.

“Together, we stand for the speedy build-out of fibre-optic infrastructure on a large scale in our region.  As a result, Germany's northwest is set to take on a trailblazing role in the sector and lead the way into the digital transformation – Glasfaser Nordwest will be providing the infrastructure in that campaign, while we ensure that products can be freely selected. The effort will result in more effective competition and the best possible connectivity for the people of the northwest,” added Stefan Dohler, CEO, EWE.

Management

The new company, whose head office will be in Oldenburg, Lower Saxony, will employ around 35 people and be led by Christoph Meurer and Oliver Prostak.

Prostak was previously head of market development within the sales management team at Telekom Deutschland’s Wholesale Center in Bonn. Outside Telekom Deutschland, he has also founded two internet start-ups.

“Glasfaser Nordwest’s foundation provides brand new opportunities for rethinking the topic of telecommunication. Based on our new business model, we aim to unite a great many telco providers on our network. Our end customers will benefit from our standardised, transparent processes no matter what provider they choose to work with,” said Prostak.

Christoph Meurer comes from a role as head of strategic cooperation at EWE TEL in Oldenburg and was chief of order and technical service management as well as FTTH project manager at EWE TEL. Before joining EWE, Meurer worked as a business consultant.

“Through our business model, we intend to reinforce the region and strengthen its competitiveness. We will use the very latest fibre-optical infrastructure to support the region in facing the emerging challenges of today and in the future resulting from the advance of the digital revolution – in both the private and the professional world,” Meurer said.