Wednesday, November 02, 2005

Wed - Deutshe Telekom will not bid for O2 - announces lay-offs instead

Deutsche Telekom today announced that they will not bid for O2, the UK and German mobile phone operator, so leaving the deal to Telefonica of Spain to complete.

Instead Deutsche Telekom announced that their fixed line business is increasinlgy challenged by competition and regulatory pressures, to the point where they will have to lay-off 19,000 employees.

It seems as though both their traditional fixed line voice business and their emerging broadband business are struggling. This is negative for the German incumbant. Struggling in fixed line voice is no surprise, but also struggling in broadband adoption is concerning. Oh dear, yet another blow to Germany!

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