Q&A: T-Systems’ Managing Director of Telecommunications

enterprise market, T-Systems, Deutsche Telekom

Patrick Molck-Ude, Managing Director of T-Systems’ Telecommunications division, discusses growth areas, competition and the Freemove Alliance

Eurocomms.com: T-Systems saw sales rise in the third quarter. Looking at the year as a whole, which services are growing the most?

Patrick Molck-Ude: There are two: hybrid networks and unified communications.

With hybrid networks, customers want a split between standardised services and having a secure network.

They want a certain quality across whole footprint… everybody’s looking at it.

With UC, customers are looking to bring telecom services to the cloud and making them more mobile.

For us, it’s all about the additional value that we can add.

T-Systems unveiled a new strategy and organisational structure in January this year. As part of that, there was a commitment to outsource/discontinue any services with low profitability. Are there any such services in your division?

We manage over 4,000 networks and I don’t see any discontinuation.

Rather I see customers, particularly mid-market ones, that used to source services locally or regionally now looking to source more internationally through one operator.

They say network quality and QoS is becoming more important as they switch to IP and the cloud. And they need it on a consistent basis.

So, we see international service provision out of one hand as a growing trend.

It is stronger on the fixed line side than mobile.

How are you responding to this trend?

We are in 43 countries but no one [provider] is covering the world alone.

It’s something we look at in terms of where we invest in infrastructure and where we partner.

We did a very thorough analysis of our customers and found that most are not global.

We decided to focus on six main markets: the UK, Austria, the Netherlands, Switzerland, Spain and the Nordics.

We are also looking at Belgium because of the EU and NATO… we want to drive more business with those two organisations.

Of course, it doesn’t mean that in other countries we will not be offering telecoms services but there are the main markets we are focusing on.

How would you assess the competition you face in the market currently?

As I said, everyone has a limited footprint.

You have to be very clear about the customers you can and should serve on the telecoms side, and where and when you partner.

There are customers who match our footprint who we are trying to win, and the win rate is increasing dramatically this year.

On differentiation versus the competition, we stand out for quality of delivery.

If you look at major incidence rates we are at the very low end both for telecoms and IT.

We deliver what we promise, plus we have unique offer of public and private cloud with telecoms services.

What’s your biggest challenge over the next 12 months or so?

We want to become more international, drive more business out of Europe to the rest of the world and offer a more harmonised service.

On mobile side, what customers are demanding is one contract, harmonised tariffs and global, standardised services.

While on the fixed side RFPs are truly international, mobile RFPs are split between 2-4 regions.

We’re using the Freemove Alliance here to cover Europe and talking to the Bridge Alliance about Asia.

What more can you tell us about the Freemove Alliance?

I was one of the founding members. What has changed in the past couple of years is that we’re using it to support the lead operators: us, Orange, Telecom Italia and TeliaSonera.

For example, one of our customers is Henkel and we support them around the world.

We use the Freemove Alliance with all the standards that were defined amongst the members to provide harmonised contracts, tariffs and services.

We changed the approach so as not to focus on a defined list of customers.

It’s a more flexible approach and there is a far more intense collaboration than in the past.

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