Personnel Rumor

Amid Slump in Poland, Deutsche Telekom Said to Seek Mobile CEO

  • Why it matters

    Why it matters

    Deutsche Telekom Chief Executive Tim Höttges wants to refocus on the European market and be a winner ín the coming wave of industry consolidation.

  • Facts

    Facts

    • T-Mobile lost 60,000 customers in Poland in the second quarter of 2014.
    • Deutsche Telekom wants to streamline its European operations.
    • Telekom CEO Tim Höttges aims to reduce costs by €3 billion by 2018
  • Audio

    Audio

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Thomas Dannenfeldt, Deutsche Telekom’s chief financial officer, made no secret of his unhappiness as early as two weeks ago.

“We are not satisfied with the business in Poland,” Mr. Dannenfeldt said when presenting the company’s half-year results.

And no wonder – the number of T-Mobile customers with contracts surprisingly sank by another 60,000 in Poland in the second quarter and sales collapsed by 10 percent in the first six months, in an important European market.

Mr. Dannenfeldt has already announced a price offensive to win back customers.

But according to information received by Handelsblatt, there will also be consequences for the T-Mobile Poland chief executive, Miroslav Rakowski, who will be removed for mismanaging the business.

A Deutsche Telekom spokesperson responded to Handelsblatt by saying the telecom company would not “take part in speculation about personnel.”

With €1.6 billion in sales, Poland is one of the bigger European markets for Deutsche Telekom. Just a few months ago, the telecommunications company acquired the Polish broadband provider GTS to attract new business customers with both wireless and landline service.

As it has in the past, Poland will again become a test market for new products. Deutsche Telekom tried out a new digital commerce product called “My Wallet” in the country at the end of 2013 before introducing it in Germany the following spring.

But the German carrier cannot afford situations like the one in Poland right now.

The weak business in Europe, for which board member Claudia Nemat is responsible, has long been a problem. In the first half of the year sales dropped 7 percent, and the adjusted operating profit (EBITA) fell by 4 percent.

Ms. Nemat has promised for more than a year to reverse the trend, but a turnaround has yet to materialize. She has offered as an explanation the economic crises gripping many countries in Europe and regulatory rulings that have harmed operators.

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