Germany sets 3G cost saving precedent

Germany's regulatory authority has set a landmark precedent by approving recommendations for shared 3G networks - reducing the financial burden on telcos already crippled by the cost of UMTS licences.

Matthias Kurth, head of the regulatory authority RegTP, has said the UMTS licence is sufficiently flexible to not preclude joint use of locations and antennae under certain conditions.

At a press conference in Bonn, Kurth said he believed the "competitive independence of the licensees can remain guaranteed", even if, for example, base stations are jointly used by two networks and appropriate software could "logically separate" the technical systems and therefore fulfil the demands of the regulator.

Smaller license holders are particularly relieved. Markus Gehmeyr, spokesman for 3G licensee E-Plus, said: "There was already a certain amount of restlessness in the market. This has been eliminated, at last we have planning security and can reckon on enormous cost savings in network set-up."

However, major players are less impressed with the developments and believe the change of heart represents a U-turn contrary to the rules set out for the roll-out of 3G networks. Andrea Vey, spokeswoman for T-Mobil, said: "The licence regulations were known at the auction last year."

D2-Vodafone has also threatened to take "legal steps," if RegTP opens up possibilities of cost savings for the smaller competitors.

The high costs of setting up the infrastructure have forced the four small licensees - E-Plus, Group 3G, Mobilcom and Viag Interkom - to push for cost savings through co-operation.
In four years, at the end of 2005, each of the six licensees must be able to offer UMTS services to at least 50 per cent of the population. Each German 3G licence cost E8bn (£4.86bn).

From http://www.silicon.de