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Achieve Gigabit targets through competition!

13.12.2023

Press release

  • Extend mobile phone frequencies by a maximum of three years, subject to conditions that promote competition. 
  • Allow competition in infrastructure and open up fibre-optic networks to a large extent.
  • Reduce processing times at the Federal Network Agency.  

In its sector report published today, the Monopolies Commission sets out recommendations on how the Federal Government’s gigabit targets can be achieved through competition for the benefit of end-users. To ensure the transition from copper to fibre-optic networks and secure future markets, the regulatory framework should create investment incentives and promote competitive market structures in the long term. In the fixed-line sector, infrastructure competition and access to fibre-optic networks – as well as consistent regulation of the copper network – play a key role in this regard. In the mobile sector, a decision on spectrum allocations in the 800 MHz, 1800 MHz and 2600 MHz bands will set the course for competition.  

Extend mobile spectrum licences by a maximum of three years, subject to conditions that promote competition 

The spectrum usage rights of the three established mobile network operators are due to expire at the end of 2025. The Federal Network Agency will soon decide how to proceed with these rights. The usual procedure would be to reallocate them through an auction. However, the authority appears to favour extending the rights by five to eight years. The Monopolies Commission also considers an extension to be sensible in this exceptional case. There are two reasons in favour of an extension. Firstly, the frequencies now due to expire could be allocated a few years later alongside other important frequencies. Secondly, before an auction takes place, it should be clear whether 1&1’s mobile network roll-out will succeed as originally planned. At the same time, in the Monopolies Commission’s view, the extension should be as short as possible and last for a maximum of three years, until the end of 2028. The interests of the other competitors must be taken into account. 

Even a short three-year extension would harm competition and should be mitigated by measures to promote competition.

Jürgen Kühling, Vorsitzender der Monopolkommission

The Monopolies Commission therefore recommends that, for the duration of the extension, the three established mobile network operators be required to offer competitors non-discriminatory access to their networks. Furthermore, the interests of the fourth network operator, 1&1, must be taken into account. 

Allow infrastructure competition and open up fibre-optic networks to a large extent 

In principle, it is only through the competitive process that it can become clear how many fibre-optic networks can be operated profitably in the long term in a given area. The Monopolies Commission takes the view that, alongside competition in network roll-out, price competition is also important and that, consequently, a ban on the over-deployment of fibre-optic networks cannot be effective. However, over-deployment can become problematic if it ultimately results in fibre-optic network roll-out in an area being partially or entirely omitted, or delayed in the long term. In the event of abusive or unfair conduct, the provisions of telecommunications and competition law may be applied. 

The rules of competition must be observed when fibre-optic networks are being rolled out in parallel.

Jürgen Kühling, Vorsitzender der Monopolkommission

Freely negotiated open network access (‘Open Access’), which is intended to enable providers to share the use of other operators’ networks in order to provide their own services via them, can help to prevent a second fibre-optic network being built by a competitor on top of an existing one (i.e. duplicate roll-out). In the Monopolies Commission’s view, for ‘Open Access’ to be conducive to competition, it is essential that, in principle, all feasible wholesale products are offered on terms customary in the German market and in accordance with uniform standards.

Reducing the duration of proceedings at the Federal Network Agency 

Some of the regulatory proceedings currently underway at the Federal Network Agency are subject to considerable delays. As this leads to sustained uncertainty for the companies concerned, every opportunity to speed up these proceedings should be utilised. To shorten these protracted procedures, the Monopolies Commission recommends, amongst other things, that the legislator incorporate further time limits into the Telecommunications Act within which procedures must be concluded. The Federal Network Agency should, in future, consolidate procedural steps that were previously carried out separately into a single, unified procedure and allocate more resources to the most important proceedings. The Telecommunications Act already provides scope for action in this regard.  

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