CEO and founder of United Internet, Ralph Dommermuth has appealed the German Internet providers to establish a joint company in order to broaden the high-speed network of the country. Largest German telecommunications company, Deutsche Telekom has been challenged to support this latest venture.
Dommermuth stated, “Industry should take the lead in laying the glass fiber network in Germany, where just 2.5% of households are directly hooked up to such ultra-fast connections — less than in other developed nations.”
In answer to Dommermuth comments, Deutsche Telekom replied that proposals for expanding Germany’s network has been submitted by several companies. United Internet, on the other hand, was late in drafting its proposal.
In order to construct a ‘gigabit society’ by 2025, newly formed government by Chancellor Angela Merkel has vowed to support the broadband investments by €10-12bn.
However, according to the calculations made by the United Internet’s founder for developing a nationwide glass coverage network, it would estimate up to 80 billion euros. Here, the sanctioned cost by the government will be able to cover only a fraction of the total amount.
With an estimated wealth of $6.4bn, the self made business tycoon Dommermuth said, “Each telecommunications company that wants to participate in this alliance would contribute capital, according to its market share.” He further added that, if companies paid in €10bn and a further €10bn came in the form of state subsidies, it would be possible to borrow a further €10bn which would help in collecting an investment of €30bn.
United Internet is ready to invest €1.4bn along with its 14% market share. However, cooperation and involvement of Deutsche Telekom will play a major role.
Adding fuel to the fire, Deutsche Telekom added that similar alliance was proposed by the company in 2017. This pact included glass fiber players such as wilhelm.tel, Deutsche Glasfaser, M-Net, Stadtwerke Neumuenster, Net Cologne and Ewetel.
Recent statement issued by Telekom suggested,“United Internet should stop all this talk and finally pick up a shovel,” Telekom said.