- · Federal Cartel Office launches formal enquiry on whether Vodafone purposefully impeded 1&1 from acquiring 5G antenna sites.
Following a complaint made by 1&1, Germany’s Bundeskartellamt (Federal Cartel Office) announced last Friday it was investigating whether Vodafone or Vantage Towers has violated German and European competition law by “impeding” the greenfield network operator’s options for co-using radio masts.
A formal investigation by the Federal Cartel Office ramps up the dispute between 1&1 and Vodafone, which has been simmering for some time.
In spring 2021, 1&1 contractually agreed with Vantage Towers — majority-owned by Vodafone at the time — to lease sites for antennas. The TowerCo then broke that agreement, maintains 1&1, through deliberate stalling of site provisioning. Germany’s would-be fourth mobile network operator subsequently missed coverage obligations attached to licences it acquired in Germany’s 2019 spectrum auction, when it won concessions in the 2.6GHz and 3GHz frequency bands (Deutsche Telekomwatch, #84).
A 1&1 spokeswoman, quoted by Die Welt, welcomed the inquiry. “The investigation by the authority will now provide clarity and transparency”, she said.
A spokeswoman for Vantage Towers and Vodafone, unsurprisingly, denied the allegation of being purposefully obstructive. “The reasons for any delays will be explained in detail”, she said. Both parties said they will cooperate with the Federal Cartel Office’s investigation in full.
In an interview with Frankfurter Allgemeine Zeitung, 1&1 Chief Executive Ralph Dommermuth, emphasised that the company’s beef was entirely with Vodafone as the main shareholder in Vantage Towers, “responsible for the design and development of Vantage radio towers”.
He also took a swipe at Vodafone for “trying to exclude us from the next frequency allocation because we have too few locations”.
It is not clear from the Federal Cartel Office’s announcement the scale of the agreement signed by 1&1 and Vantage Towers in spring 2021, but it did mention that Vantage Towers manages a total of 19,400 antenna locations in Germany. Since that agreement was signed, Vantage Towers has been delisted from the Frankfurt Stock Exchange and ownership is now shared between Vodafone and a consortium led by Global Infrastructure Partners and KKR.
“Irrespective of the Bundeskartellamt’s proceeding,” added the Federal Cartel Office, the Bundesnetzagentur (Federal Network Agency/BNetzA) is examining whether it should fine 1&1 — reportedly up to €50m (£43m) — for missing its intermediate deadline to install 1,000 5G antennas by the end of 2022, of which Vantage Towers appears to be largely responsible for providing site locations. Local reporting suggests 1&1 could only muster five antenna sites by that time.
1&1 recently applied to BNetzA asking for the regulator to order the country’s other three MNOs to allow it to use their networks, regardless of technology. A BNetzA spokesperson confirmed to TelcoTitans that the regulator has received and is examining 1&1’s application, which was universally condemned by its rival MNOs in the country.
Mundt machinations
The mood music coming from the Federal Cartel Office sounds promising enough from 1&1’s point of view.
As part of the announcement that an investigation had begun into Vodafone Germany and Vantage Towers, Andreas Mundt, President of the Bundeskartellamt, reiterated what appears to be the prevalent regulatory preference in Germany of having four MNOs, and warned bigger players they will be harshly dealt with if found guilty of stymieing 1&1’s progress. He indicated the investigation will be a thorough one.
“ We welcome the intended market entry of 1&1 as a fourth mobile network operator in Germany from a competition perspective. It is clear that to develop its own mobile phone network a company has to make high investments and take entrepreneurial risks when taking such a step. It is a key task of competition law to set fair rules of play for companies’ business practices. Powerful and dominant companies must not unfairly impede other companies. We will therefore scrutinise whether there are sound reasons for a delay in the provision of antenna locations for 1&1. ”
Mundt.
Dommermuth optimism
Despite the problems with Vodafone, Dommermuth in his FAZ interview insisted he was “quite optimistic” about meeting longer-term coverage obligations, working with various TowerCos (not just Vantage).
“In the second quarter [three months to 30 June], we can see that construction output is already increasing significantly”, he said, adding that, “by the end of the quarter, we will have 200 cell towers”. Dommermuth claimed 1&1 “will complete 3,000 locations in each of the next few years.
“ In this way, we will meet he long-term requirements of the Federal Network Agency. ”
Dommermuth.
