German regulator threatens sanctions over missed coverage targets

Germany's Bundesnetzagentur (Federal Network Agency/BNetzA) said all three mobile network operators failed to meet coverage targets set at the 2015 auction of 700MHz spectrum to a greater or lesser extent, and warned that fines could be imposed if coverage shortfalls are not resolved by the end of 2020.

Telefónica Germany, Telekom Deutschland and Vodafone Germany all submitted reports on meeting coverage targets by January 1, 2020. The primary goals were to provide at least 50Mbit/s broadband speeds to 98% of households nationwide and 97% of households in each federal state. (See 700MHz: Coming soon to Germany.)

Telekom and Vodafone claimed to have generally met the household targets, although Telefónica admitted it fell somewhat short at only 84.3% national coverage. However, all three operators failed to provide the required full coverage of the main transport routes by the end of the year. Furthermore, Telekom and Vodafone each missed targets in a small number of individual federal states.

After examining the reports and concluding that none of the operators had achieved all targets, BNetzA said it expected improvements to be made during 2020 and indicated that penalties could be imposed if the targets were not met in full by December 31, 2020. The agency has also set interim deadlines of June and September to maintain pressure on the operators.

While a reprimand over missed coverage targets will have been expected, the threat of financial penalties comes at a time when networks are already under pressure from extra demand in the COVID-19 era. Even before the full impact of the coronavirus was known, Telefónica was calling on BNetzA to refrain from imposing penalties.

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In a statement from early March, a spokesperson for the operator said it was Telefónica's view that it is "fundamentally counterproductive for the network rollout in Germany to impose severe penalties on companies when they demonstrably expand the network at full speed in the interests of their customers."

Meanwhile, BNetzA recently indicated that networks had been stable during the health crisis, and said the operators were well prepared to meet the increase in data traffic. It also welcomed moves by Netflix, YouTube, Amazon and Facebook to reduce the load on the networks by modifying the transmission quality of their streaming services.

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— Anne Morris, contributing editor, special to Light Reading