United Internet AG plans to invest significantly more in its own mobile network in the coming years, as Group CEO Ralph Dommermuth told news agency dpa-AFX. Moving existing customers to the new, owned network of 1&1 Mobilfunk involves a lot of effort and is not expected to be completed until 2025.
United Internet to invest up to one billion euros in 2022
The company plans to invest up to one billion euros in the current year. About 400 million euros of that will go into the network of mobile subsidiary 1&1 Mobil, according to Dommermuth. The company also plans to invest “significantly” in the network in the coming years. The plan: From summer 2023, the company wants to make its fourth, own mobile network available throughout Germany. At present, existing contracts mostly use the networks of O2 and, in some cases, Vodafone.
However, when setting up its own mobile network, the company will have to adhere strictly to the specifications and requirements of the Federal Network Agency. By the end of 2022, around 1,000 base stations are to be made available for 1&1 mobile communications. At the start, however, only FWA (fixed wireless access) will be offered, which connects to the company’s own 1&1 network in the home via a WLAN router.
Mobile 5G support is then expected to be available in mid-2023, Dommermuth added. In May 2021, Telefónica Deutschland and 1&1 Drillisch agreed on a roaming agreement after protracted negotiations. The currently around 11 million mobile customers automatically switch to the Telefónica network via roaming if the 1&1 mobile network is not available.
According to Dommermuth, such a national roaming agreement was indispensable in order to be able to push ahead with the expansion of the company’s own network. “Our customers already need connectivity everywhere during the years of network construction. If you were to build a new network and customers only had coverage at your own antennas for now, it wouldn’t work – you’d quickly run out of customers,” the group CEO told dpa.
Already 5 billion euros invested in mobile network
According to the company’s own statement, at the current time it has already invested almost five billion euros in the acquisition of frequencies, as well as the orders for the expansion of fiber optic lines, antennas and services. However, the total cost of the 1&1 mobile network will be significantly higher in the future, as additional orders and further construction phases are still necessary, it said.
The migration of existing customers in particular involves a lot of technical effort. 1&1 says it currently has around eleven million mobile customers, and transferring their numbers to the new network will take time. The move to 1&1’s own network is scheduled to begin in the fall of 2023 and then “take place within a period of two years,” Dommermuth said.
In connection with the expansion of the company’s own network, the Group CEO expects additional revenue for the current fiscal year. Sales are thus expected to rise to around 5.85 billion euros – which would still be around 200 million euros more than in the previous year, when sales for the MDAX-listed company were 5.65 billion euros.