Sunday, 16 June 2019

Telcos spend €6.5bn at Germany's 5G auction – but were they overcharged?

By Chris Kelly, Total Telecom
Thursday 13 June 19

Germany auctioned off spectrum in the 2,100MHz and 3.6GHz range

Germany's telecoms regulatory authority has raised €6.5bn at its 5G spectrum auction, as telcos bid for the spectrum with which they will launch their 5G mobile network services. However, their have been murmurs of discontent among the country's mobile network operators, who feel that they have been forced to overpay for spectrum…

Germany's telecoms regulatory authority has raised €6.5bn at its 5G spectrum auction, as telcos bid for the spectrum with which they will launch their 5G mobile network services.

However, their have been murmurs of discontent among the country's mobile network operators, who feel that they have been forced to overpay for spectrum.

Vodafone Germany paid a total of €1.88 billion for 90Mhz of 3.6GHz spectrum and an additional 40Mhz of 2100MHz spectrum. The licence for both blocks of spectrum will run until 2040.

“Vodafone is committed to bring the full benefits of a digital society to Germany through our gigabit network including 5G. We believe it is important to have a balance between the price paid for spectrum and our strong desire to create an inclusive society through investment in mobile network coverage,” said Vodafone Group chief executive, Nick Read.

Read's comments hint as a general air of frustration from all three of Germany's big three MNOs, who accused the country's telecoms regulator, BNetzA, of artificially inflating the cost of spectrum during the auction process.

Deutsche Telekom, who also won 130MHz of spectrum but paid a total of €2.17 billion for it, has been the most outspoken on the issue of spectrum pricing.

Speaking earlier this year, the company's CEO, Tim Hoettges, said that the regulator was in danger of stifling Germnay's 5G rollout plans, by pursuing short term financial gain at auction.

“An artificial shortage of public resources is being created, which may push up the price,” Hoettges told the company’s annual general meeting in Bonn, as first reported by Reuters.

“In the end, there is no money for the build-out,” he added.

Telefonica Deutschland, Germany's third largest MNO, spent a total of €1.42 billion on 90MHz of spectrum, acquiring 20MHz ofof 2100MHz spectrum and 70MHz in the 3.6GHz range.

The auction's newcomer, 1&1 Drillisch, completed the bidding, winning 50MHz off 3.6GHz spectrum and 20MHz in the 2100MHz band. Reuters news agency reported that shares in 1&1 Drillisch soared by 9.4 per cent after the spectrum win was announced.

 

Total Telecom will launch its Connected Germany event on the 19th - 20th November. Click here to find out more about the event. 

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German regulator brushes aside MNO concerns on spectrum pricing

Telefonica Deutschland looks to stall Germany's 5G auction

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