Question

Describe the connection technologies available to retail consumers. What were Deutsche Telekom’s price structures for these connection technologies? How were retail prices in the market for telephony services regulated?

Answer 1

There are two ways to achieve a retail connection to DT’s telecommunications network, the first one being the traditional analog means of connection. The second way is connecting through a digital narrowband known as an integrated service digital network. The two ways of access provide the connection to DT’s existing copper network. Their also upgraded broadband connections are also available to enable faster internet connections. DT also had two price structures for these technologies. The first method was a monthly charge which varied depending on the type of connection and quality. The second method was an off-line charge for every new line connection or the takeover of an existing line. Retail prices for analog and ISDN lines are regulated under a price cap system that is only permitted for adjustment according to a set basket of telecommunications services. Mandatory price reductions allowed DT to modify charges as many times as possible as long as the changes were subject to the approval of the regulatory authority.