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Germany’s 5G auction finally comes to an end

The multi-band award of spectrum ended after nearly three months and a whopping 497 rounds.

Background: The German auction of spectrum for 5G in the 2GHz and 3.6GHz bands started on 19 March 2019. It came after extensive consultation and the looming risk of legal challenges, since Deutsche Telekom, Telefonica and Vodafone all filed appeal to a court in Koln weeks before the process was due to start.

At long last: The regulator BNetzA announced the end of the process on 12 June 2019, after almost three months and 497 rounds of bidding. Last week, the regulator reportedly changed the minimum amount required for each bid; to facilitate the end of the auction. Eventually, the total raised just exceeded €6.5bn. Deutsche Telekom was the biggest spender, with €2.17bn for 2x20MHz in the 2GHz band and 90MHz in the 3.6GHz band. Vodafone spent €1.88bn for the same amount of spectrum; Telefonica paid €1.42bn for 2x10MHz in the 2GHz band and 70MHz in the 3.6GHz band; and Drillisch Netz (1&1) paid €1.07bn for 2x10MHz in the 2GHz band and 50MHz in the 3.6GHz band. All the licences will be valid until 2040, although only the 3.6GHz lots will be available this year. The 2.1GHz lots will be available from 2021, with some only available from 2025.

The reactions: Operators clearly showed they needed this spectrum by going all the way to secure it; however, they lamented the lengthy and expensive auction, which will impact their investment plans. Deutsche Telekom stated that "The price could have been much lower. Once again, the spectrum in Germany is much more expensive than in other countries. [...] With the auction proceeds one could have built approximately 50,000 new mobile sites and close many white spots”. Vodafone issued a similar warning, saying that “it is important to have a balance between the price paid for spectrum and our strong desire to create an inclusive society through investment in mobile network coverage”.