Germany’s competition regulator (Bundeskartellamt) plans to investigate Vodafone and its infrastructure subsidiary Vantage Towers over alleged illegal activity. Total Telecom reported that the examination involves whether the companies impeded mobile service rollout by rival 1&1.
In 2021, 1&1 signed an agreement with Vantage Towers to utilize its existing infrastructure to develop a 5G network. However, Vantage Towers’ construction of additional infrastructure has been “significantly delayed over the past year, potentially leaving 1&1 unable to fulfill its own rollout obligations” Andreas Mundt, president of the Bundeskartellamt (a.k.a., Federal Cartel Office), said in a statement.
“Powerful and dominant companies must not unfairly impede other companies. We will therefore scrutinize whether there are sound reasons for a delay in the provision of antenna locations for 1&1,” Mundt said.
Total Telecom reported 1&1 is Germany’s newest operator. The company won a spectrum auction in 2019, and has gradually rolled out its 5G network. To meet the demands of its 5G license terms, 1&1 needed to scale its rollout plans quickly. That’s where the agreement in late 2021 with Vantage Towers came into play. 1&1 was supposed to have access to 3,800 rooftop and ground-based sites by the end of 2025, and over a thousand additional sites were to be built in 2022.
1&1 expected to have 1,000 sites up and running by now, but in reality, they have just five operational sites, blaming Vantage Towers for failing to live up to its side of the agreement, presenting 1&1 with “ongoing obstacles.” 1&1 filed a formal complaint against Vodafone and Vantage Towers with the Bundeskartellamt.
“The provision of the agreed locations was massively delayed and continues to be delayed,” noted the Bundeskartellamt in a statement. The regulator added that these sites would be imperative for the effective launch of 1&1’s commercial 5G services, scheduled for the latter part of 2023.
The findings by the Bundeskartellamt will determine who’s at fault for the 5G rollout delay. This decision is critical for 1&1 since it is being investigated by the Bundesnetzagentur (Federal Network Agency) for failing to reach its obligated rollout goals. If Vantage Towers is found liable, it’s unlikely that the Bundesnetzagentur would financially penalize 1&1 for its missed targets, reported Total Telecom. However, fines could run up to $55,500 per missing base station, totaling $53.5 million.
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