Due to deficits in the mobile phone network expansion, a supervisory authority is considering asking Germany’s large telecommunications providers to pay for the first time. “The Federal Network Agency currently intends to impose a fine of up to 50,000 euros per location,” says a letter from the Bonn authority to its advisory board. The document is available to the dpa. It is about sites that should have been built by the end of last year as part of the 2019 frequency auction, but were not. It goes on to say: “In addition, fines can also be levied.” Penalty payments could have even greater financial consequences.
Basic service instead of dead spots
According to their own statements, the three established network operators Telefónica (O2), Vodafone and Deutsche Telekom have fulfilled the central requirements of the expansion obligations – for example that in every federal state at least 98 percent of households have a mobile phone connection with a download of 100 megabits per second. In the case of so-called white spots, on the other hand, all three clearly broke the bar. This is about areas where no cell phone network can transmit 100 megabits per second. Instead of having 167 own locations in such an area by December 31, 2022, Vodafone reported only 86, Telefónica 61 and Telekom 38.
Among other things, the threat of sanctions in the letter to the advisory board refers to such locations. The network operators emphasize unanimously that they are making progress. There are 14 more under construction, says a Telekom spokesman, for example. He also emphasizes that at the remaining 115 locations “there are mostly no dead spots”, but there is a “basic service” – the mobile phone gets broadband reception, but the prescribed minimum transmission of 100 megabits per second is missing.
No property – no radio mast
The companies also point out that they received a government list of the affected areas too late and that expansion is simply not possible in some places – for example when no property owner is willing to rent a piece of land for a radio mast. The erection of such masts is also difficult in nature reserves. If it is impossible to set up antennas for “legal and factual” reasons, the Federal Network Agency does not classify this as a misconduct.
It is therefore unclear how large the gap to the mandatory requirement of 167 is – depending on how many locations the Federal Network Agency considers “legally and actually” impossible, it is smaller or larger. The Bonn authority is currently examining the documents that the companies submitted at the beginning of January.
Mobile operators under pressure
The most extreme violation of the expansion obligations does not come from the three established network operators, but from the newcomer 1&1. This company bought frequencies for the first time in 2019 and is currently building its own mobile phone network – so far 1&1 has sold mobile phone contracts in which customers are mainly connected to the O2 network. 1&1 pays rent to O2 for this. The group from Montabaur should have activated 1000 5G stations at the turn of the year, but in fact there were only five. 1&1 justified this with delivery problems at a construction partner. 1&1 wants to reach 1000 in the summer of 2023. Should 1&1 be sanctioned, it could be expensive.
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However, it is unclear whether the Federal Network Agency will impose fines or penalties at all. After the frequency auction in 2015, not a single network operator met all of its obligations – Telefónica (O2) in particular revealed serious deficits at the time. At that time, too, the regulatory authority threatened sanctions, but in the end turned a blind eye.
Threats without consequences?
It could be the same this time. The letter to the advisory board, which is meeting this Monday, says: “When sanctions are imposed, an overall assessment takes place, in which the respective individual case is to be assessed.” The sentence leaves room for interpretation. It is quite possible that the authorities will only make a threat this time to increase the pressure, but will ultimately not take any action.
However, the telecommunications companies should not be too sure about this. Because Klaus Müller, who previously headed the Federal Association of Consumer Centers, is now at the head of the regulatory authority. He is known for paying more attention to consumer protection issues than his predecessor – instead of forgoing a legal dispute with companies, the authority may want to enter into it this time and enforce sanctions.
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