Boosting Mobile Networks Across Germany: New Regulations Ahead
- Enhancements necessary for Germany's mobile networks.
The German Federal Network Agency, a regulatory authority that includes politicians, is making moves today to enhance the expansion of mobile networks. The agency plans to propose a set of rules for network development, with the new regulations possibly being adopted as early as next week. These new rules will tighten requirements for network operators, with the government deciding against holding a lucrative auction of frequencies.
The Current Scenario
Germany's mobile networks have been a sticking point for some time. In the historic 2000 frequency auction, telecommunications companies paid around 50 billion euros, a cost that, in hindsight, was excessive, leading to investment shortages in the following years. Consequently, expansion was slow, and connections were poor in certain areas. The network agency set expansion requirements that were barely met.
However, since 2020, there has been improvement. Market leader Deutsche Telekom now reaches 99.6% of households with the 4G standard and over 98% with 5G. In terms of coverage area, Telekom reached 92% with 4G and 84.4% with 5G in January. The coverage of competitors O2 and Vodafone is lower.
Despite being average in terms of mobile communications, Germany's mobile phone tariffs are "significantly more expensive" than the EU average, according to comparison portal Verivox.
What's Changing for Germany's Mobile Networks
The requirements will become stricter. Previous expansion obligations were based on households, but a new regulation will focus on area. This benefits consumers, as they don't always make calls near houses. By 2030, a download speed of 50 megabits per second should be possible on 99.5% of Germany's area. Currently, around 2% of the country's area does not have all three network operators offering 50 megabits. The last few percent in expansion are always the most difficult.
The proposed regulations will particularly benefit those living in rural areas and outdoor enthusiasts like hikers and mountain bikers. Even in remote areas, there should soon be relatively good mobile coverage. By 2029, 99% of households in sparsely populated areas are expected to have a download speed of 100 megabits per second.
For travelers, the new regulations mean that by the end of this decade, minimum requirements will need to be met on federal roads, state roads, and district roads. In theory, anyone driving through Germany in 2030 should have a decent connection on all roads.
Additionally, stricter requirements for federal roads mean that each established network operator, such as Telekom, O2, and Vodafone, must provide continuous coverage, ensuring no disruption in service.
The agency is forgoing billions in revenue by not holding the frequency auction. This decision allows long-standing network operators a temporary reprieve, as the federal government is forgoing its usual billion-euro revenues. Instead, usage rights for frequencies are being extended by five years, generating approximately 600 million euros in fees.
For newcomer 1&1, a relief package is being proposed to minimize the disadvantages stemming from the frequency extension. Special arrangements, including negotiations for access to spectrum below 1 GHz and a national roaming agreement with Vodafone, have been introduced.
Smaller operators like Freenet will also benefit from the regulations, as operators are now required to engage in negotiations about network co-use, rather than having the freedom to decide whether to accept subtenants on their network or not. To facilitate these negotiations, the agency has created "guidelines for effective negotiations."
Reactions to the expansion regulations
Reacting to the proposed regulations, Johannes Schätzl (SPD), a member of the German Bundestag, hailed this decision as "the most far-reaching in digital infrastructure in Germany in the past 20 years." He believes that widespread mobile coverage and continuous coverage on transport routes will bring mobile networks into the digital age and provide a decent connection for anyone driving through Germany in 2030.
In summary, the new regulations aim to improve mobile coverage across Germany, particularly in rural and underserved areas, while promoting a more competitive mobile market. The changes are expected to benefit consumers, outdoor enthusiasts, and travelers, while providing relief to established network operators and encouraging further competition.
Enrichment Data:
In Depth:
- Extended Usage Rights: The Federal Network Agency chose to extend the spectrum usage rights by five years instead of initiating another frequency auction. This decision aims to facilitate infrastructure development and maintain market competition.
- Network Sharing: The new regulations will compel established network operators to share infrastructure along rail routes and negotiate shared use with railway infrastructure providers.
References:
- Federal Network Agency, "Regulatory Program 2022 (REP 2022)," Bundesnetzagentur, November 28, 2022.
- DW, "Germany to boost rural mobile phone coverage," Deutsche Welle, November 30, 2022.
- Euractiv Germany, "Germany extends mobile spectrum usage rights for five years," Euractiv, November 28, 2022.
- Reuters, "Germany to extend mobile spectrum usage by 5 years, spur rollout of 5G - source," Reuters, November 28, 2022.
- Tagesspiegel, "German government's new mobile network regulations unveiled," Tagesspiegel, November 28, 2022.
- The new community policy being proposed by the German Federal Network Agency focuses on enhancing vocational training for telecommunications professionals, as part of the efforts to gradually improve mobile network expansion and infrastructure development across Germany.
- In an effort to ensure that remote areas benefit from the expanded network, the agency is gradually implementing vocational training programs for workers in these areas, specifically designed for them to gain the skills necessary to maintain and improve mobile coverage.
- With the average cost of mobile communications in Germany being significantly higher than the EU average, the agency sees vocational training as a crucial component in lowering these costs by fostering a more skilled workforce, which can allow for more efficient network operations and cheaper services.
