“T-Systems makes loss for years”

Wolfgang Specht

The analyst at Bankhaus Lampe is an expert in the telecom industry.

(Photo: Bankhaus Lampe)

For years, Wolfgang Specht observed the Deutsche Telekom, He has been waiting for a long time a radical approach to the loss-making subsidiary T-Systems.

Mr. Specht, what does the conversion mean for Deutsche Telekom?
It's not the first restructuring at T-Systems, but it could be the biggest one. This project could be followed by the relocation of more parts.

Will the destruction of T-Systems begin now?
That could be quite. It is not yet possible to say what happens to other areas of Deutsche Telekom's corporate customer subsidiary. Management would certainly like to sell parts on favorable terms or, as in this case, more clearly allocate parts.

Is that a right step?
Yes. For a long time the separation of medium-sized companies and large customers is discussed. 20 years ago, it made sense that major customers are treated differently from SMEs. Today the requirements are similar. Therefore, it is consistent to give the responsibility in one hand.

Is it unusual for the T-Systems boss to volunteer to influence?
Not necessarily. Al-Saleh has been brought to Telekom as a reorganizer. That does not mean that he should make T-Systems bigger and bigger. T-Systems has been losing for years. That needs to change. With this order, Al-Saleh has started at Telekom. The conversion makes sense.

How has al-Saleh beaten so far?
That is hard to say. Sales have stabilized. There was no dramatic decline in the operating result. That is already positive. He has made many changes. But it will take more time to evaluate if these were sustainable steps.

How will T-Systems continue?
Even after the conversion, the future of the classic IT business remains an unsolved problem for T-Systems. There were several attempts to sell the area or to bring it into a joint venture. But no one was successful. A mass dismissal is hardly questionable. If Al-Saleh can not repel the area, he will probably want to melt it off. Many of the employees are not so far from the pension. He could use that to further reduce the business.

Does Telekom still need T-Systems?
Telekom needs lighthouse projects. Ideas and concepts have been summarized by Al-Saleh at T-Systems. It is about IT security, the Internet of Things or cloud services. But it is not necessarily necessary for them to be offered under the T-Systems brand.

Mr. Specht, thank you for the interview.

More: For years, the deficient subsidiary T-Systems is the problem child Telekom. Now the company is planning a radical transformation – that could be the beginning of the breakup.

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