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In the radically and rapidly changing world of telecom and ICT, KPN is the network that has been bringing people together for the last 125 years. Through our services, products and network we ensure that people and businesses are online wherever and whenever they want, with whatever device they choose. That’s where our strength lies. As the challenger on the German and Belgian mobile markets we are playing a significant role in shaping the market place.

We have a mission: to be the best service provider and to give our customers the best and most integrated network. At home, at work and on the move. We achieve this with high-quality customized services and products under a number of brands, enabling us to cater even better to the needs and wishes of the various customer groups. For example, we make a distinction between products, services and price, so customers can choose the brand that best suits their needs and wishes.

The network that cares for society

As the biggest ICT service provider in the Netherlands we are conscious of our (social) responsibilities. This is why over the last few years we have invested heavily in the quality of the service we give to our customers, in technology and in our fixed and mobile networks, as well as in simplifying our processes and our organization. For instance, we increased the upload and download speed for broadband, we raised the quality of our IPTV product to an even higher level and we launched new transparent mobile propositions. We opened new shops, improved our call-out service and introduced the free 24/7 helpdesk. With these initiatives we are putting the three core values of our strategy into practice: “Strengthen”, “Simplify” and “Grow”.

For millions of customers, the copper network serves as the basis for our three fixed services: IPTV, internet and fixed telephony. Around 979 thousand of our customers take these three services in a single package (triple play). In the business market, we help small and large organizations with total ICT solutions. We offer them total integration of voice, data, fixed and mobile services. We also offer ICT applications to the government and the healthcare and education sectors. Corporate Market supplies large organizations with, among other things, workspace services, network solutions and data center services. We have 37 million mobile customers, of which 10 million are in the Netherlands, 23 million in Germany and 3 million in Belgium.

Many of our customers call our network the best in the Netherlands. The thousands of transmission masts and the countless kilometers of copper cable and fiber ensure that our mobile and fixed services can operate. Other parties use our network too. A stable and reliable network requires maintenance and modernization. Furthermore, we have to anticipate a strong growth in data traffic, especially as a result of mobile internet usage. That is why in 2012 alone we invested EUR 2.209 billion, of which EUR 1.509 billion in our fixed and mobile infrastructure services in the Netherlands, Germany and Belgium. In December 2012 we acquired an attractive combination of frequency licenses for the Dutch mobile market for EUR 1.352 billion. Among other things, this cleared the path for the roll-out of the 4G LTE network, which we have since started. More and more customers are taking advantage of the latest fiber technology, which makes speeds of 500 Mb per second possible. At the end of 2012 the number of customers taking services via the fiber network had tripled in comparison with 2011. Besides providing fiber access we continued the upgrade of our copper network, enabling us to continue offering adequate bandwidth and upload and download speeds in the Netherlands.

Customers determine success

Improving our service is the central theme in our strategy. We realize that it is the customer who decides whether we fulfill our ambition of becoming the best service provider. KPN employees who are in direct contact with our customers play a crucial role in this. To enable these employees to offer good service to our customers we invested in new shop concepts and improved the management and scheduling of our engineers. Furthermore, we increased the number of call center staff and gave them more freedom to solve customers’ problems. And as more and more people are discovering social media as a service we also invested in KPN Webcare, our online customer service.

Social responsibility

We invest not only in our customers, services and technology but also in society, because the role of ICT in our society is essential. We aim to strengthen our company and use ICT in a sustainable manner, because we regard sustainability as a self-evident part of our business operations. Consequently, the five themes on which our social policy is based are under the direct responsibility of the Executive Committee.

We want to help the Netherlands and our customers make progress and to offer them the best ICT infrastructure. One of the ways we are doing this is with 4G LTE, the new generation of mobile internet. By rolling it out quickly we aim to provide this new technology, which makes superfast uploading and downloading possible, throughout the Netherlands within the next 18 months. The more our society becomes dependent on ICT, the more it becomes vulnerable. An increasing volume of sensitive and confidential information passes over the internet. Recognizing that we have to give our customers secure and reliable connections, we give top priority to security and privacy. We place the highest priority on the security of both our network and our internal privacy policy. For many years KPN has been pre-eminent in the Netherlands in The New Way of Living and Working. Thanks in part to that experience, we make it possible for a growing number of customers to work irrespective of time and place. More and more companies are experiencing and recognizing the positive effects of this concept on, for example, employee involvement and the environment. In terms of energy saving we are now among the world’s “greenest” telecom and ICT companies, because our energy consumption is decreasing despite the exponential increase in data traffic. The theme “Energy efficient” enables us to show that we give top priority to energy saving. In addition, we help our customers to save energy themselves. We are able to highlight the value of ICT in the healthcare sector too and we are gradually improving the efficiency and effectiveness of the healthcare sector. We reinforce our ambitions in terms of healthcare with the theme “Healthcare of the future”.

The management

KPN is a public limited company incorporated under Dutch law, led by the Board of Management. The Board of Management, under the leadership of Chief Executive Officer (CEO) Eelco Blok, controls strategic, financial and organizational matters and appoints senior management. The Board of Management is also responsible for overseeing the work of the Group Executive Committee (ExCo), which controls the segments. The Supervisory Board is charged with supervising and advising the Board of Management.

At the start of 2012 we introduced the new segment structure, in which the NL ExCo controls the operating activities in the Netherlands and the International ExCo is responsible for the operational activities abroad. We carried out the organizational changes so as to be able to run the various business units more directly and efficiently and to respond even better to new ICT developments and the rapidly changing customer wishes. The ExCo falls under the direct responsibility of the Board of Management. ExCo Group is represented by ExCo NL, ExCo Mobile International and corporate departments on HR, Legal and Strategy. ExCo NL consists of Consumer Residential, Consumer Mobile, Business Market, NetCo, Corporate Market, while Germany and Belgium are part of ExCo Mobile International.

More information about the composition of the Board of Management and the changes during 2012 can be found on page 52 of the Annual Report.

The strength of KPN staff

As an employer, we expect commitment, expertise and professionalism from our employees. We offer good employment conditions and fringe benefits. As a modern company we promote The New Way of Living and Working, which on the one hand offers more freedom and on the other hand involves more personal responsibility. Currently, 9,000 KPN employees are taking advantage of this modern style of working.

We are convinced that teamwork is the key to success. Its importance is expressed on TEAMKPN Online, the internal communication platform which connects all employees with one another. KPN employees inform and help one another and share knowledge via news reports, videos, blogs and other media. TEAMKPN Magazine is another valuable communication medium that provides employees with a wealth of background and information.

We believe it important for employees to continue to develop themselves and to keep their knowledge and skills up-to-date. We therefore offer them the possibility of adding to or enlarging their skill set within a specific area of competence. We run a talent program in order to find and hold on to graduates and those with higher professional training. We invest in keeping all our staff members fit. Physical and mental fitness tests are available to all KPN employees, and the results can be used to make health improvements, if necessary. The interactive coaching program I-Change helps employees to change their lifestyle. 

People connected

Thanks to the KPN Mooiste Contact Fonds we ensured that in 2012 alone over 200 seriously ill children could continue taking their school lessons and stay in touch with their classmates. Our lead sponsorship of skating is another social initiative that allows KPN to become even better connected with the Netherlands and the Dutch population. We sponsor skating in all its forms: from the professionals to the young beginners, from the enthusiastic recreational skater to the loyal fans of the Dutch stars watching competitions on TV. With our lead sponsorship of the Rijksmuseum in Amsterdam we have now also established a cultural connection with the Netherlands. Through this partnership we are going to ensure that the Rijksmuseum has the most modern ICT and telecom services, so it is connected with the entire world and can make its art collections accessible to all.

KPN’s strategy 2011-2015 targets three principles: