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Germany’s 5G Auction To Keep Barriers For New Entrants High

The German government aims to launch a 5G spectrum auction early next year.

German mobile operators will not have the obligation to cover all of the country’s territory when deploying 5G services over the next decade — but they’ll have to come close, according to international press reports citing internal documents from the Germany’s Federal Network Regulator (BNetzA).

Under the reported terms of the auction process, mobile carriers would need to make investment in 5G networks to cover at least 98% of German households by 2022, offering high-speed connection of 100 Mbps.

The country’s three telcos — Deutsche Telekom, Vodafone and Telefonica Deutschland — have previously said that deploying 5G all across the country would be a difficult target to achieve.

Mobile phone operators will not be required to allow national roaming when they deploy 5G network infrastructure, which would represent a barrier for new entrants as they will need to make heavy investments to deploy 5G infrastructure.

The proposed terms for an upcoming 5G spectrum auction will be discussed by BNetzA’s advisory board on September 24.

Last week, Germany’s antitrust regulator called for a fourth mobile carrier to enter the domestic market when 5G licenses are auctioned in 2019.

The Federal Cartel Office’s head Andreas Mundt suggested that market concentration has left Germany’s economy lagging behind its rivals in the race to build connected factories or put self-driving cars on the road.

Mundt also called for existing mobile carriers to open up their networks on a non-discriminatory basis to third parties such as service providers and virtual mobile network operators (MVNOs).

Deutsche Telekom, Vodafone and Telefonica Deutschland have said that allowing network access to other operators and MVNOs would put them at a further disadvantage, as these firms will not have to invest significant resources in network infrastructure.

In May, BNetzA had announced plans to auction spectrum in the 2 GHz and 3.6 GHz frequency bands for the provision of 5G services. The auction is expected to take place during the first months of 2019.

Meanwhile, the country’s largest telco, Deutsche Telekom, called for auction conditions to be equitable.

“5G can only become a driving force for innovation and reinvigorate the labour market if the peripheral conditions are fair,” said Dirk Wössner, member of the Deutsche Telekom Board. “We anticipate that the volume of investment for the sector will be considerable. Figures of this magnitude are not to be taken lightly,” he said.

One thing should be clear – we can’t have a situation where only some are investing and bearing the risks while others only reap the rewards,” Wössner added.

He added: “A range of different technologies and components are coordinated and controlled in a 5G system. Comprehensive broadband coverage will initially be achieved using existing and new LTE locations and technologies. 5G will be added where it is technically feasible. This means requirements must be formulated in a technology-neutral manner.” – RCR Wireless

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