Deutsche Telekom Pulls Plug on Debt Riddled Telecoms
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Germany -- Many call-by-call service providers, including Internet providers, must stop their telephone sales within the next few weeks, reported German magazine "Der Spiegel," in its most recent edition. According to the "Spiegel," the reason for this action is the high debt of many telephone provider companies to its initial supplier, Deutsche Telekom AG.
Numerous competitors of this German telephone conglomerate, such as Teldafax, Callino or RSL.com are in the red with a total amount of half a billion German marks. Over half of this amount is already in its third warning stage. Despite Telekom's offers for discussion and warnings, many companies will not settle their debt.
Therefore, Telekom has decided, within the next few weeks, to cut its services to the companies in default. Telekom already announced this action to the Marburg telephone provider Teldafax. According to the Spiegel, Teldafax owes Telekom over 85 million German marks. Telekom will cut the line should Teldafax (listed on the stock exchange) not even pay a portion of its debt. A few weeks ago Telekom proceeded similarly with the Frankfurt provider Star Telecom.