The Federal Network Agency apparently initiates penalty proceedings for the first time against Germany’s mobile network operators Deutsche Telekom, Telefónica Deutschland (O2), and Vodafone due to weaknesses in the mobile network. This action was taken “due to culpably late and incomplete fulfillment of coverage obligations,” as stated in a letter from the authority obtained by the German Press Agency (dpa).
The proceedings were opened in September 2023 but were not publicly known until now. The companies can still provide their statements, and a decision on the penalty proceedings will be made in the coming year. Additionally, the companies face potential fines in separate, simultaneously initiated proceedings.
The network operators argue that they have not violated the expansion requirements. They rely on an exemption clause: where expansion was not possible for legal or factual reasons—such as the unavailability of a property to erect a cell tower—the obligation is considered fulfilled even without network coverage.
However, the Network Agency disagrees with the operators’ stance, believing that in some cases, this reasoning doesn’t apply, and antennas could have been installed in certain areas. The case involves 500 4G dead spots where none of the three operators provide a 100 MBit/s reception, which should have been resolved by the year-end, but the companies didn’t achieve this everywhere.
Furthermore, there are still connectivity issues in some federal highway tunnels, despite being mandated—this is also under scrutiny in the proceedings. Industry insiders suggest that the number of shortcomings is very low. If fines are imposed eventually, they are likely to be relatively modest.
The opening of these proceedings is seen more as a signal to the industry to intensify efforts in network expansion and to fully comply with coverage obligations. Previously, the Network Agency turned a blind eye in similar cases. None of the three operators met the expansion obligations by the end of 2019 resulting from the 2015 auction, but no fines were issued at that time.
Telefónica faced significant challenges then, while Telekom and Vodafone had minor shortcomings. Although a penalty procedure was initiated against Telefónica in 2020, it was terminated after O2 significantly improved its standing.
The agency’s new approach might be attributed to the fact that the Federal Network Agency has had a new chief for a year now.
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