Telekom, Vodafone, Telefónica and 1&1: Network expansion is too slow

Berlin, Hamburg Have Deutsche Telekom, Vodafone, Telefónica and 1&1 provided the country with sufficient mobile networks? The Federal Network Agency is currently investigating this question and intends to present a report on Monday.

The answer is likely to be costly for companies. Because they have been subject to conditions since 2019, which the companies received along with valuable 5G frequencies. A fine of up to 50,000 euros is threatened for each missing mast, depending on the fault.

In December, the bosses of the telecom companies had already approached the advisory board of the authority to answer questions from politicians from the federal and state governments. They tried once again to present omissions as through no fault of their own, as can be seen from meeting documents. They are available to the Handelsblatt.

According to this, the companies have indeed achieved many of the goals imposed: 98 percent of households cover the big three with fast Internet, as well as many motorways and railways.

But there is a problem with the 500 areas that have not yet been covered, the “white spots” on the mobile phone map. According to agency head Klaus Müller, concrete contracts for masts were only available for 173 spots at the beginning of December, and 153 were still missing suitable locations more than three years after the auction. With the remaining dead spots, the providers are “relatively advanced”. There are also problems in the railway tunnels.

Penalties of up to 50,000 euros – for each missing mast

That’s what it will be about on Monday when the Advisory Board meets next time. There are reasons for every mast that has not yet been built, Telekom Germany boss Srini Gopalan had already reassured in December, in agreement with the other bosses.

>> Read also: The many dead spots are an embarrassing failure of the federal government

This does not go down well with politicians. CDU member of the Bundestag and member of the Advisory Board Nadine Schön said: “It is frustrating that some of the goals were not achieved.” The 500 base stations in particular would have meant important progress, as did the expansion of the new network. “We will discuss reasons and responsibility and also draw the necessary conclusions,” announced Schön.

Politicians of the governing coalition threaten. “If the companies neither close the white spots nor 1&1 is able to set up radio masts, then this must also be sanctioned,” said the FDP MP Maximilian Funke-Kaiser. And the Green politician Tabea Rößner, chairwoman of the digital committee in the Bundestag, said: “I understand that the search for a location is difficult, especially in rural areas. But conditions are not there to be without consequences if they are not met.” SPD digital politician Jens Zimmermann also calls for the “conditions to be consistently complied with and enforced”.

Network expansion: 1&1 has a particularly bad record

Above all, the balance sheet of United Internet founder and CEO Ralph Dommermuth is poor. The newcomer among the network providers, who has been working on a fourth mobile network in Germany since 2019, is not making any progress. Of the thousand radio stations that Dommermuth’s company 1&1 would have had to put into operation by the end of 2022, only three were in place at the beginning of 2023.

The head of the company was particularly humble back in December. He wants to build a new type of network with what is known as an Open RAN infrastructure, which will make him independent of established suppliers such as Ericsson or Huawei. The technology is extremely powerful and flexible – as long as there are masts.

Dommermuth’s main supplier is the formally independent Vodafone subsidiary Vantage Towers, which, according to industry circles, apparently did not connect a single mast instead of the guaranteed 650 masts. It is noticeable that mother Vodafone made good progress, although not in the white spots.

Ralph Dommermuth

The CEO of United Internet promises to significantly expand the 1&1 network by the end of 2023.

(Photo: Michael Englert for Handelsblatt)

1&1 does not comment on the expansion figures of individual contractual partners. On request, Vantage states that “strict confidentiality” has been agreed with 1&1.

The company tries to use existing cell towers. In addition to the main supplier Vantage, 1&1 has concluded contracts with two other fattening companies. However, they only come into play when Vantage is not yet operating a mast in a radio cell. Then it is laboriously checked whether another mast can be used or whether a new one has to be built. This query alone “does not go as quickly as desired,” Dommermuth said at the December meeting of the advisory board.

The head of the Federal Network Agency listened carefully and wants to check whether mobile phone masts could not be regulated in such a way that all network operators can use them – to save time and accelerate expansion.

1&1 wants to set up 1,000 masts by the end of 2023

In an interview with the Handelsblatt, Dommermuth was now confident: more than three locations are now in operation. He wants to connect the 1000 masts that should be up in 2022 by the end of the year. “Building antennas is complex, but ultimately not rocket science,” said Dommermuth.

The contract with Vantage Towers now provides “tighter deadlines for the completion of the sites”. He is in constant contact with the network agency and politics. “We do everything that is commercially and technically possible.”

The companies hope for leniency. Agency President Müller acknowledged, for example, that there were problems in providing tunnels with mobile communications. Here, “the necessary cooperation of Deutsche Bahn AG should be taken into account,” he said understandingly.

railway tunnel

The mobile operators blame the railways for the fact that many tunnels have no reception.

(Photo: imago/Robert Michael)

The mobile operators had pointed to the railway, which only hesitantly allowed access to the tunnels. Telefónica boss Markus Haas, for example, had explained that 1000 locations were needed to supply the rails with sufficient power. So far, however, the railway has only been able to provide around 30. Gopalan, head of Telekom Germany, complained that it would take until 2025 to gain access to all tunnels. There were also problems with the railway radio, which would only be modernized in all trains by 2024. Philippe Rogge from Vodafone also made it clear that the delays were “not our fault”.

In addition, the companies refer to long procedures. According to them, it takes two to three years from planning to the connected mast. A year’s approval is required.

The Advisory Board will discuss this next Monday. The agency wants to present its final report in March – including the consequences.

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