IBM Announces Development Agreement With Deutsche Telekom AG / T-Com

IBM (NYSE: IBM) and Deutsche Telekom AG / T-Com announced today that the companies will collaborate to transform the Deutsche Telekom / T-Com fixed line network into an NGN (Next Generation Network). The agreement will include the development and management of advanced services.

This IP-based network transformation will include the entire range of Internet services and the high standards of telephony that are available today. On behalf of Deutsche Telekom / T-Com, IBM has developed unique software-based services that in combination with IBM server technology will transform Deutsche Telekom / T-Com's service offerings. As a result Deutsche Telekom fixed line customers will have a new range of services at their disposal.

"The German fixed line network delivers outstanding quality of voice and data transmission, but at present it does not yet have the integration capability that is required for convergence of services," said Matthias Hartmann, General Manager IBM Germany and head of IBM Global Business Services. "The development initiative between IBM and Deutsche Telekom AG / T-Com starts with fixed line network replacement and will move on to integrating other innovative services."

The long-term conversion of the German fixed line network into a state-of-the-art NGN (Next Generation Network) infrastructure based on Internet standards (the Internet protocol/IP) will combine the full range of services offered by the Internet and the high standards of telephony that are already available.

IBM has developed special software that runs entirely on standard IBM server technology and IBM software which makes it possible to transfer Deutsche Telecom's existing network communications structure to a new IP infrastructure.

In contrast to conventional VoIP solutions, it resolves IP-specific challenges with respect to security and quality of transmission, personal identification and localization. The new NGN architecture thereby benefits both Deutsche Telekom and its customers significantly and in equal measure.

For Deutsche Telekom this leads to entirely new ways to market services systematically in both the home and the business segments. Higher quality services, for example, that cannot be marketed in an integrated manner via existing networks can now be provided and billed to both consumers and business customers. In this way companies in other industries will in the future be able to benefit from new, IP-based process solutions such as automated meter reading for utilities or networked in-car communication, navigation and vehicle servicing.

"This solution, developed on the basis of open standards and the IP protocol, is a trend-setting model for the transfer of traditional telecommunications business models and their simultaneous integration in the exciting variety of IP-based solutions, which include the Internet. Jointly with IBM we will be seeking to convince telecoms providers in other countries of the carrying capacity and business prospects of this solution," said Wolfgang Schmitz, head of the Technology Rollout Center, Deutsche Telekom AG/ T-Com.

The agreement was signed in Q4, 2006.