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QSC: Regulation obstructs competition

Cologne, April 12, 2002 - The German Regulatory Authority for Telecommunications and Posts (RegTP) only slightly reduced the one-off fee payable by competitors of Deutsche Telekom AG for access to Deutsche Telekom's local loop to connect new or switch existing customers to a new provider. In many cases, the new prices are only five percent below those demanded by the incumbent.

"This is far too little to stimulate the stagnating competition on the last mile", criticises Bernd Schlobohm, CEO of QSC AG. "This clearly is the result of intense political lobbying. The price reductions are not based on Telekom's service provision costs, which are in fact much lower."

To connect a new DSL customer now costs EUR 136.73 instead of the EUR 141.85 initially requested by Deutsche Telekom AG (a price cut of only 3.6 percent), even though the actual costs, including all process and administration expenses, are at most EUR 50. This is, incidentally, the price paid by Deutsche Telekom end-user customers.

QSC finds it difficult to understand why, according to the latest RegTP decision, Deutsche Telekom may charge more (up to twelve percent) when the same cable is used for high-speed data transmission, such as DSL, even though the labour time and costs are essentially identical for Deutsche Telekom. The RegTP has even increased the charges payable by competitors for advance enquiries for DSL lines.

"Germany is DSL country. All current market studies indicate that DSL will play a key role in the growth of telecommunications. To that extent, today's decision by the RegTP is obstructing technological progress in Germany", claims Schlobohm.

QSC AG (QSC) is an alternative DSL provider in Germany, offering broadband leased-line connections and innovative services of the highest quality to business and residential customers over normal telephone lines. The company's broadband network infrastructure now covers more than 40 of the largest cities in German, thus reaching more than 20 million potential users. QSC currently employs a workforce of 280.

Claudia Zimmermann
Mathias Brüggen Str. 55
D-50829 Köln
Tel.: +49 (0)221/6698-235
Fax: +49 (0)221/6698-289
E-mail: presse@qsc.de