Germany’s attempt to catch up with the digital era starts this week when the auction for airwaves to build ultra fast 5G wireless networks will begin.
This technology is crucial at the moment since Europe’s biggest economy seeks to transition from old-school engineering to catch up with the new digital age.
The country seems to be behind in the race of mobile network speeds compared to Qatar, Albania and Moldova.
Rubin Ritter, co-chief executive officer of Europe’s biggest online fashion retailer Zalando said, “Updating Germany’s digital infrastructure is very important. There are moments when customers have difficulties accessing our app.”
German Chancellor Angela Merkel and her government have promised to create new and advanced digital infrastructure. It expects an income worth around 5 billion Euros however the actual amount of the bill is difficult to predict at this moment in time.
They aim to allow family-owned manufacturers and corporate behemoths to digitize production processes and create data services.
The bidders comprise of current network operators such as Deutsche Telekom, Vodafone and Telefonica.
The auction starts on Tuesday and it comes with legal issues over the terms and conditions as well as pressure on the country’s government to Huawei equipment due to growing global security concerns.
On Friday, Huawei’s Western European chief told Business Daily Handelsblatt that they “would never build back doors into our devices or pass on data illegally.” He continued, “We would also be ready to sign a no-spy-agreement with the German government.”
5G technology guarantees super fast internet speed which is said to be able to download a full-length film in a matter of seconds.
The telecommunications industry, after experiencing a steady decline in share prices over the past few years, is hoping that this new technology will bring up new opportunities of communication such as holographic chats and potentially some fresh revenue streams into the industry.
Deutsche Telekom plans to invest 20 billion Euros in Germany over the next few years aiming to introduce high speed internet and 5G services. This investment levels caused many bidders to file lawsuits against the government’s conditions for the auction some of which included providing download speeds of 100 megabits per second to 98% of German homes, all highways and federal roads by the end of 2022.
A court eliminated the lawsuits so the auction can now carry on as planned.
“Driving with a car through Germany you lose your cellular connection every 5km. The network infrastructure we have right now in Germany is a big weakness,” said Stefan Brandl, chief executive officer of EBM-Papst.