Decision time for T-Mobile
The owner of T-Mobile, Deutsche Telekom is under great pressure from key shareholders to either sell or merge its UK business, T-Mobile, with a rival company.
Deutsche Telekom finance chief, Timotheus Hoettges, said yesterday at the company’s annual general meeting (April 30) that it may report writedowns of around 1.8bn euros (£bn) for its mobile operation in Britain when it relays first-quarter results next week.
“The British market is highly competitive and has comparably low margins,” he says.
“In our view consolidation is a means to take excess capabilities out of the market. Nothing is unthinkable on our side.”
According to the Financial Times, a large part of the pressure is coming from the firms two biggest shareholders, the German government, which owns 32% of DT and private equity group, Blackstone which owns 4.5% of the group.
T-Mobile is the fourth largest player in the telecoms market, followed by Hutchinson Wampoa’s 3, who they merged 3G Radio Access Network with to form Mobile Broadband Network. In light of this move, it is rumoured that another fusion with them is being considered to resolve T Mobiles current problem.
This worrying news comes after last night’s launch of T-Mobile’s sing along stunt at Trafalgar Square, where 13,000 people, including US singer Pink, came together and sang their hearts out in a mass karaoke session.
The moment was caught by Saatchi & Saatchi to be used in a T Mobile advert that will launch on YouTube and on television during ITV1 show Britain’s Got Talent tomorrow (May 2).
The new campaign follows on from the company’s Dance” ad launched earlier this year which saw 350 dancers performing a routine at Liverpool street station.
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