Fibre optic expansion rate at 43.2% in mid-2024, fibre optic connection rate at 22.8%
Expansion in the area slows down, number of connected households increases significantly
Deutsche Telekom competitors take over the majority of the expansion: 61% of Homes Passed, 70% of Homes Connected, 77% of Homes Activated
Forecast: 2025 expansion target can be achieved, 2030 expansion target will be clearly missed under current political conditions
Schleswig-Holstein remains the frontrunner in a state comparison. Bremen and Brandenburg with the strongest growth

Bonn, 10.09.24 – In its BREKO Market Analysis 2024 published today, the German Broadband Association (BREKO) shows that the expansion of fiber optics in Germany continues to progress. As of June 30, 2024, the fiber optic roll-out rate is 43.2 percent and the share of connected households is 22.8 percent. However, as fiber optic expansion is slowing down across the country, BREKO is calling on the federal government to finally take effective measures.

With 2.6 million newly built connections (Homes Passed), the fiber optic expansion rate will increase by 7.6 percentage points to 43.2% between mid-2023 and mid-2024 according to the market analysis, but will grow by 1.6 percentage points less than in the same period of the previous year. The proportion of connected households (Homes Connected) – the fiber optic connection rate – will increase by 4.5 percentage points to 22.8%, 3.6 percentage points more than in the same period last year. At the same time, the proportion of households that have booked a fiber optic connection (Homes Activated) has also risen slightly: The take-up rate now stands at 26 percent. These are the results of the BREKO Market Analysis 2024, which is based on data from all relevant companies involved in the expansion of fiber optics in Germany. It is therefore representative of the German telecommunications market.

Currency exchange: focus on connecting households

Currently, 10.5 million buildings and homes are connected to the fiber optic network (Homes Connected) – around a quarter of Germany. Study author Prof. Dr. Jens Böcker: “Despite many obstacles, the telecommunications industry is continuing to invest in the expansion of fiber optics. What is striking is that while the focus in recent years has been on expansion in rural areas, companies are now increasingly moving towards connecting households, businesses and public institutions. Deutsche Telekom’s competitors in particular are ensuring that their customers are connected to the fiber optic network instead of just building the fiber to the street.”

Deutsche Telekom’s competitors take over most of the fiber-optic expansion

At EUR 13.2 billion, total investment in fiber optic and mobile network expansion remains at a high level, but is declining slightly for the first time in years. Although Telekom’s share of investment rose to EUR 5.6 billion and fell to EUR 7.6 billion for its competitors, the alternative network operators remain the drivers of network expansion with 58% of investment. Telekom’s competitors account for the lion’s share of fiber optic expansion in particular: they are responsible for 61% of Homes Passed, 70% of Homes Connected and 77% of Homes Activated.

BREKO President Norbert Westfal calls for a clear political course correction

With a view to the forecast of the market analysis, according to which the fiber optic expansion rate will rise to 50 percent by 2025 assuming stable development, but only to a value between 76 percent and 86 percent by 2030, BREKO President Norbert Westfal warns:

“Despite major economic challenges such as increased expansion costs and a shortage of skilled workers, Telekom’s competitors in particular are continuing to drive the expansion of fiber optics. Furthermore, in view of the political expansion target of 2030, a clear political course correction is needed now more than ever to create investment security and set investment incentives. The fact that expansion is slowing down across the country is an early indicator with consequences: According to forecasts, the German government will achieve its goal of fiber optics for half of German households by 2025. However, under the current political framework conditions, nationwide fiber optic coverage by 2030 will be missed by a wide margin. As BREKO, we have long been proposing concrete measures to achieve this goal. In particular, we are calling on the Federal Network Agency to develop a concept for a competitive transition from copper to fiber optic networks: The aim here is to prevent Deutsche Telekom from strategically shutting down its copper network only where it has laid fiber itself. In addition, an effective service provider obligation is finally needed – in order to provide an impetus for fair competition and break up the prevailing oligopoly in mobile telephony. Unfortunately, it has become increasingly clear in recent months that the traffic light coalition has apparently lost interest in the expansion of fiber optics.”

Dual expansion and copper-fiber optic migration are the most pressing issues

One of the biggest problems for fiber optic expansion remains Telekom’s strategic dual expansion. According to the data from the market analysis, 78 companies are currently affected by dual expansion activities by Telekom or its subsidiary Glasfaser Plus. Around one in three companies (31%) has even withdrawn from expansion projects due to dual expansion.

BREKO Managing Director Dr. Stephan Albers: “Even if Telekom would like to believe the opposite: the strategic double expansion of the market-dominant company remains a central problem in fiber optic expansion. This economically absurd behavior prevents the expansion of entire municipalities, deters investors and is a burden for citizens. Nothing has happened since the Federal Network Agency’s monitoring report was published in April. Sitting the issue out only benefits Telekom.”

Large majority of companies want clear regulation for copper-fiber optic migration

Another issue that is driving the industry is the upcoming transition from copper to fiber optic networks. According to the market analysis, 9 out of 10 companies (89%) consider it important or very important that there is a competition-compliant regulation for the so-called copper-to-fiber optic migration. Only 4 percent consider this to be unimportant.

Albers: “As the competitors are responsible for two thirds of the fiber optic expansion, a concept for a copper-fiber optic migration in line with competition is now all the more necessary. So far, there is no corresponding regulation for the regions in which the competitors have laid fiber optics. Telekom, on the other hand, can decide for itself whether to switch off its copper network where it has rolled out fiber optics. Our demand is clear: the switch-off in regions where Telekom has laid fiber optics may only be approved if the copper network can also be switched off in areas that are comparably well supplied with fiber optics by competitors and comparable wholesale products are offered. Both the dual expansion and the copper-fiber migration require a Federal Network Agency that not only has the interests of the company with market power in mind, but also actively ensures fair competition.”

State comparison: Schleswig-Holstein remains at the top ahead of Hamburg and Brandenburg

There are major differences in the progress and speed of fiber optic expansion between the federal states. At 89.3%, Schleswig-Holstein still has the highest fiber optic roll-out rate, followed by Hamburg (82.7%) and Brandenburg (59.3%). The largest increase was recorded in Bremen with a plus of 26.3 percentage points. Thuringia (33.8%), Baden-Württemberg (29%) and Berlin (28.5%) bring up the rear.

Schleswig-Holstein (52.2%), Brandenburg (42.6%) and Hamburg (39.4%) are also at the top in terms of the fiber optic connection rate. Brandenburg achieved the largest increase in the proportion of connected households with 7.6 percentage points. Albers: “In order to accelerate the expansion in the federal states, we finally need faster approval procedures. Fiber optic expansion must therefore also be defined as being in the ‘overriding public interest’ in the Telecommunications Network Expansion Acceleration Act. The Bundestag and Bundesrat have a duty to make fundamental improvements here in order to create a framework for accelerating the expansion of fiber optics after all.”

Open Access is becoming increasingly important

Opening up existing networks to other providers is becoming increasingly important. According to a market analysis, 89% of the network operators organized in BREKO already offer access to their networks. Albers: “Open Access ensures more competition and is gaining acceptance as an alternative to double expansion. Albers: “Open Access ensures more competition and is gaining acceptance as an alternative to double expansion. The cooperations ensure higher network capacity utilization and offer customers a greater variety of services.”