Frequency auction

As smaller service providers, E-Plus and O2 say they feel the bidding process for digital frequencies puts them at a disadvantage compared to much larger operators such as Vodafone and T-Mobile.

The Federal Network Agency gave the green light to the license auction in October. Part of the 360 megahertz packet on the block became available as a result of the switch from analogue to digital terrestrial television.

These "digital dividend" frequencies are especially desirable for mobile telecommunications carriers, as they permit greater coverage in rural regions with relatively few transmitting stations.

The auction - which will be Germany's largest in 10 years - is expected to generate up to 5 billion euros ($7.4 billion).

On Monday, the head of E-Plus - Germany's third-largest provider - said the company's goal was not to prevent the auction from taking place. Rather, the company wants the competition to be fair.

"We want a fast expansion of mobile broadband Internet under fair conditions, and low data rates for consumers," said CEO Thorsten Dirks.

Support from Brussels

E-Plus and O2 simultaneously launched expedited proceedings in the hope of receiving a swift answer from the court. The auction is set to take place in the second quarter of 2010.

O2 and E-Plus are not the only entities to have voiced concern about the fairness of the frequency sale. German news agency dpa reported that EU Media Commissioner Viviane Reding sent a letter to the Federal Network Agency, in which she mentioned a "clear discrepancy" in the auction proceedings to the detriment of E-Plus and O2.

dc/dpa/AP
Editor: Sam Edmonds