1&1's 5G Progress Puts Germany's Mobile Market on a 2026 Watchlist
1&1 migrated 12.48 million mobile customers to its own network and said its 5G network now covers 25% of German households. Germany's 2019 5G spectrum award remains uncertain after BNetzA said it would relaunch proceedings tied to 2GHz and 3.6GHz rights. Potential changes in roaming, cooperation or M&A around Telefónica and 1&1 could reshape Germany's four-player mobile market.
Germany's 5G Challenger Enters a More Complicated Phase
1&1 has reached important milestones in its attempt to become Germany's fourth mobile network operator, but the next phase looks less simple than basic rollout progress.
The United Internet-owned operator migrated 12.48 million mobile customers onto its own network before the end of 2025 and said in December that its network covered 25% of German households.
That coverage level met the first target attached to Germany's 2019 5G frequency auction.
The company also plans further fixed and mobile deployment in 2026, supported by its €1.3 billion, or US$1.5 billion, acquisition of 1&1 Versatel from United Internet.
The broader market context is still challenging.
BNetzA data showed that around 95% of Germany's territory had 5G coverage toward the end of 2025, up from 93% in 2024.
Deutsche Telekom reached 87%, while Vodafone and Telefónica O2 were at about 75% and 76%, respectively.
1&1 was not included in that comparison, even though it has been building an open RAN-based 5G network.
Spectrum Uncertainty Becomes the Main Watchpoint
The most immediate risk sits with Germany's 2019 spectrum award.
The four German mobile network operators spent a combined €6.55 billion, or $7.7 billion, on 2GHz and 3.6GHz rights.
After an August 2024 Administrative Court in Cologne ruling found the license conditions and rules were not lawful, BNetzA said it would relaunch 5G spectrum award proceedings.
The regulator has not yet decided whether it will rerun the auction or adjust usage rights retroactively.
For now, the frequency assignments remain valid until BNetzA revokes and reissues them.
The written consultation on next steps has a January 12, 2026, submission deadline.
For operators, the practical issue is not only legal process.
Spectrum terms shape network economics, capacity planning and competitive positioning.
If the award process changes materially, Germany's mobile operators may need to reassess rollout assumptions even as 5G standalone becomes a bigger focus.
Roaming, Partnerships and a Possible Market Reset
1&1's commercial position also depends on wholesale and roaming relationships while it expands its own network.
The company currently uses a national roaming agreement with Vodafone Germany, which came into effect in 2024.
Before that, 1&1 used Telefónica's network for 15 years.
A reported change in Telefónica Germany's leadership adds another variable.
Santiago Argelich Hesse became CEO on January 1 after Markus Haas departed, and reports said Telefónica is seeking to revive its relationship with 1&1.
Those reports also raised the possibility of closer cooperation or even a Telefónica takeover of 1&1, though neither company had commented.
The key question is whether 1&1 can turn regulatory target compliance into durable market leverage.
Its customer migration and household coverage progress show execution momentum, but spectrum uncertainty and possible partnership shifts may decide how disruptive Germany's fourth operator can become in 2026.
