Deutsche Telekom (Wireline Strategy)

Over the last year, Deutsche Telekom's share price significantly underperformed the DJ Stoxx Telecom index. Of its peer group, only TDC and France Telecom did worse. In our view the main reason for this is Deutsche Telekom's inability to adequately restructure the business at a pace that the market demands. Deutsche Telekom understands the challenges it faces. But strategic repositioning by Deutsche Telekom looks set to take longer than for other telcos. However, in recent weeks Deutsche Telekom has signalled that it is ready to become more aggressive in its domestic go-to-market strategy in an effort to defend its market position.