Wow, I have to say 1&1 not getting the low-frequency band was not my base case.
I looked up the exact comments of 1&1 during the Q4 2023 earnings call regarding this possibility and impact. Ralph Dommermuth said:
Then you asked what we are doing if we don’t receive any low end frequencies. And I’d say, I’d expect that we will receive them. But of course, there could be an auction and someone may have a better bid than we do. Then we will have to buy more roaming than we do today. Our network is working as operational today without low band frequencies. So where we don’t have coverage for our frequencies, we will have to buy more roaming. And when we are lacking frequencies, we will have to replace them with roaming services.
On the one hand, that’s expensive because roaming costs money. On the other hand we will save the money for purchasing frequencies. So you could now do the math using your spreadsheet and try to calculate when it’s cheaper to remain at roaming and when it’s cheaper to switch to the broadband frequencies.
So if it’s €100,000,000 for example, for roaming, the frequencies will be less expensive and the other way around. So we will have to evaluate or assess that if we do not receive frequencies. But for now, we would expect that we will receive them because it has to be free from discrimination. "
What is your assessment of the overall situation?
Do you know if 1&1 has the contractual guarantee to buy low-frequency frequencies from Vodafone over the full course of their contract and prices for low-frequency only are more or less defined already by the terms of this contract?
Would the BNetzA create an obligation for national roaming like outlined here?
Do you have a link to the source of the internal letter from the Federal Network Agency?
What are analyst or market commentators are saying or thinking about it?
In summary: How much would 1&1 be affected by not getting low-band spectrum? Are enough rules in place that would guarantee them to buy the spectrum and be not at a large disadvantage either from a quality of service and cost perspective?