The graphic shows United Internet’s three material value chains: “Hardware purchasing and trading”, “Provision of IT infrastructure,” and “Digital services”. These value chains are described individually in the following.
The “Hardware purchasing and trading” value chain is located in the Consumer Access Segment and in Corporate. Whereas Consumer Access serves consumers in Germany, Corporate is responsible for purchasing the equipment used by staff in the Business Applications and Consumer Applications segments.
The upstream value chain for “Hardware purchasing and trading” primarily comprises device manufacturers such as Samsung, Apple, and Dell, which deliver smartphones and laptops in particular, and shipping service providers. Upstream of hardware manufacture is where the raw materials are extracted. These include oil for plastics production, aluminum, silicon, lithium, copper, and critical raw materials such as indium, light rare earths, and cobalt, which are primarily extracted in countries such as China, Australia, the U.S.A., Chile, and the Democratic Republic of the Congo. The devices themselves are mainly manufactured in Asian countries such as China, Vietnam, and India. The upstream logistics until the equipment reaches United Internet are global. United Internet’s own value creation for “Hardware purchasing and trading” happens in Germany, as does its downstream value creation, which includes transportation to customers and the disposal and refurbishment of old equipment. The environmentally friendly disposal or refurbishment of devices and old IT equipment are significant environmental matters in downstream activities. United Internet’s approach here is to cooperate with specialist business partners so as to minimize environmental impacts.
The "Provision of IT infrastructure" value chain is operated by the Business Applications, Business Access, and Consumer Access segments. Business Applications plays a special role here, since data center capacity that it provides within the Company is used by Consumer Access, Consumer Applications, and Corporate alike. Equally, Consumer Access also uses the Business Access telecommunications infrastructure, meaning that in this case the value chains between the two segments are superimposed.
The upstream "Provision of IT infrastructure" value chain contains the Business Applications and Business Access segments, plus hardware suppliers; energy, data center, and software providers; and other wholesale network partners. Upstream value creation includes construction of the fiber-optic and antenna networks, wholesale network services, and the manufacture of hardware equipment such as servers. Electricity supplies must also be included in this category. At the top of the value chain is the extraction of raw materials for the hardware required; this takes place in countries such as China, the U.S.A., Chile, and the Democratic Republic of the Congo, while the hardware is manufactured in the U.S.A., Taiwan, and Japan, among other places. In addition to the raw materials needed to manufacture devices, raw materials such as cement, quartz sand, copper, and steel are required for network construction. The wholesale network services are sourced from Germany , from Telefónica and Vodafone among other providers. Upstream data centers are located throughout Europe but also in the U.S.A.; these include both the third-party co-location data centers and the Business Applications data centers. Electricity for the data centers is generally supplied locally.
The Company’s own value creation in the "Provision of IT infrastructure" area primarily takes place in Germany, since this is where the material office locations and the fiber-optic and antenna networks are located. In addition, there are a few offices in other European countries, the Philippines, and the U.S.A. Equally, data centers can be found in the U.S.A. and other European countries.
In principle, downstream value creation can happen anywhere in the world. However, most Business Applications customers are to be found in Europe and North America, whereas Business Access and Consumer Access customers are primarily located in Germany.
The third value chain, “Digital services,” is provided by the Consumer Applications and Business Applications segments. In turn, Consumer Applications uses digital services supplied by Business Applications, which is why this segment is also to be found in the upstream value chain.
Upstream value creation includes the necessary IT infrastructure, which is supplied both by Business Applications and by co-location data centers. Raw materials extraction, hardware manufacture, and electricity supplies are similar to those in the "Provision of IT infrastructure” value chain. The same applies to the data centers and offices that form part of the Company’s own value creation.
Whereas the Business Applications Segment primarily target business customers in Europe and North America, Consumer Applications’ activities are focused on the DACH area. However, in principle the digital services can be accessed and used worldwide.
Another United Internet value chain to date has been energy trading in the Consumer Applications Segment, which offers end customers electricity and gas contracts. New contracts relate solely to green electricity; however, a small number of gas contracts and a small percentage of gray electricity contracts are still in circulation. These activities account for less than 1 % of Group revenue. The business area is to be discontinued or sold. For these reasons, energy trading has not been included in the presentation of the material value chains. Apart from energy trading in the Consumer Applications Segment, United Internet does not engage in any material activities in the fossil fuels sector or in the extraction, processing, or trading of coal and oil.
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