IFA - Deutsche Telekom offers IPTV specials

Deutsche Telekom AG is lowering prices and giving away live soccer coverage to a limited number of first-come, first-serve customers to generate demand for its new Internet TV service, executives said Wednesday in Berlin.

The move comes as Deutsche Telekom seeks ways to recoup the more than €3 billion (US$4 billion) the operator is investing in a new high-speed broadband network designed to support next-generation services such as IPTV (Internet Protocol television).

Telephone companies across Europe are rolling out IPTV service in the hope of creating a new revenue stream to offset the decline of their cash-cow circuit-switched telephony businesses, which are being gradually eclipsed by low-cost VOIP (voice over IP) offerings.

Luring consumers away from Germany's numerous free TV channels is challenging, but with attractive fees, exclusive content, broader network coverage and new interactive services, Deutsche Telekom believes it can win customers, board member Timotheus Höttges, responsible for the operator's T-Com unit, said at a news conference ahead of the IFA consumer electronics show, which opens Friday in Berlin.

The German telco announced an average price cut of 16 percent for its "triple-play" telephone, high-speed Internet and IPTV packages, which range from €70 to €85 with a VDSL (Very high bit-rate Digital Subscriber Line) connection. VDSL offers transmission speeds up to 50M bps (bits per second).

In addition to VDSL, the operator has decided to offer IPTV service over ADSL2+ connections to extend coverage. The operator currently offers ADSL2+ service in more than 750 cities, compared to VDSL's 27. ADSL2+ supports data speeds up to 24M bps.

More than 15 million households are currently connected to the high-speed network of Deutsche Telekom, which plans to add 2 million by year's end. The operator expects 25 million broadband lines in Germany by 2010.

The German operator, which has purchased the broadcast rights to the German Bundesliga soccer games, also announced an offer, beginning next week, to give the first 20,000 new IPTV customers free game coverage through the end of next year. Live soccer coverage otherwise costs €10 per month.

As for European Commission demands that Deutsche Telekom share VDSL infrastructure with competitors, CEO René Obermann said Germany has sufficient competition in the market for high-speed services. "There is no need to regulate this market," he said, arguing that regulation of new markets such as VDSL could block investment.

"We have also said all along that we are willing to work with resellers but we want to have a say in shaping the prices and conditions," he said.

More information about IFA -- the letters stand for Internationale Funkausstellung, although the full name is rarely used these days -- is available at the show's Web site.

The IDG News Service is a Network World affiliate.