German problems – telecoms and dodgy dotcoms
Case of the DTs
You've asked whether Deutsche Telekom would be the most arrogant phone company in the world. Oh yes, they certainly are :-).
I wish these suckers would read this. I've suffered them for years, and they still are the only DSL provider in my area.
I've heard that BT are no heroes, too, as friends from England told me. However, comparing the two, BT would be a far second on the shit list.
There is another interesting piece regarding the problems outlined in your article "Deutsche Telekom threatens to withdrawn (sic) flat-rate Net access" which I'm not sure whether is mirrored in the Oftel/BT dispute.
DT is currently trying to roll out DSL ("T-DSL") across the country in a massive operation - it is hard to walk by a bus stop without noticing one of the "High-speed Internet" ads posted everywhere.
Anyway, their push has been hit by some supply problems with the DSL modems, and possibly with a shortage of qualified tech people as well to update the local exchanges. As a result, there is currently a massive backlog of DSL orders for them.
One reason why people are going for this (apart from the obvious: speed) is the fact that DT offers a reduced price for a DSL-only flatrate: it only costs 49 DM per month, as opposed to 79 DM for the analog/ISDN/DSL combo that has been investigated by RegTP.
So the argument of DT (that only came up after the RegTP decision) goes about like this: The analog/ISDN flatrate was only meant as a transitionary offer while they were trying to get data traffic off the circuit-switched network and onto the always-on DSL. They claim that the RegTP decision now forces them to pour money into updating the capacity of the outdated analog/ISDN network for an indefinite period, while they would much rather spend it on expanding their DSL infrastructure.
As a final twist, DSL access through DT's own network is currently available only for subscribers of T-Online, DT's own ISP, while negotiations with AOL and others are stalling. Meanwhile, RegTP mulls
whether they even have the authority to regulate DSL at all...
Anyway, having received my DSL account well before the current rush, I am personally in the situation of a curious bystander. :-)
I think the most important fact concerning this German Law is the kind of business it covers. This law is only important for business to customer deals, not for business to business deals. Any producer of goods will negotiate individual prices with his business custumers. Therefore the "Rabattgesetz" und
"Zugabenverordnung" have no relevance to this kind of deal. I agree, a German producer would most properly have no chance in any open market, when he had to offer equivalent prices for all of his customers, but this is not true.
Where both laws have to get attention is with business to customer deals, where "fixed" prices are given by a dealer, which can only be changed slightly by a customer. But do you really think business to customer markets are open? How many times have you bought your everyday needs at a company with no seat in Britain? Sure, there may be some people who do so, but these people are a minority. I'm sorry, I forgot about exact data, but most of all attempts to shop online fail, mostly because of technical insufficiencies on the dealer side. Therefore (have you ever ordered anything from overseas by phone?) I think of business to customer markets as closed markets and can see no reason why any German company could get in troubles because of our customer protection laws.
Maybe it could get a problem in say 5 to 10 years but, to be honest, I don't think, the Internet is as important as some people would like to have it. Too many (ir)rational fears keep the Internet from getting any real importance with deals. Of course this is just my very personal opinion. Also my very personal opinion is, that the falling of these two customer protection laws has nothing to do with any open or closed markets. It's more an (successful) attempt of huge companies to get rid of some very nasty laws, preventing additional profits. A German price tag is a fact. You know, you have to pay the amount, written down and your only chance of getting more for less is, let's say a mouse for an complete computer or a pair of shoes with Your new doll. That's all. At the time, these laws fall, any worker at "media markt", "Promarkt" or "Saturn" (some of these high tech discounters) will know two
prices, the one written on the price tag and the other one, the "minimum price".
His job will no longer be to inform customers but to keep the price as high as possible and therefore keep profits as high as possible. This is something, small shops have difficulties with. The only chance for them to survive is (as they can't get these fantastic mass discounts while buying their goods (as I
already mentioned, these laws have no meaning in b2b deals)) to provide superior information. But what happens, when these small shops have to double their dealers to provide both, the time to inform an customer and the time to negotiate the price? Perhaps it's just the fundamental change, I fear, but some things, I really enjoy will no longer be possible. When I'm in need of a product, no matter, what it's price is, I can rush out 30 minutes, before "Ladenschluss" (no 24h openings in Germany) and buy it. No fear to pay too much (if I'm familiar with prices of different shops). Not yet. But what if I have to have half an hour just to negotiate the price? Or, the other way round, save half an hour and then get to know later, I could have saved a serious amount of money.
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