The FTSE 100 telecoms group bought 90 MHz in the 3.6 GHz band for €1.07bn for 5G and then spent another €806.5mln to "provide continuity and expansion of existing services" with 40 MHz of 2100 MHz spectrum. Both bands have a licence term through to 2040.
Germany's Federal Network Agency, Bundesnetzagentur, carried out 497 bidding rounds for the spectrum auction, with results showing that Vodafone spent less than Deutsche Telekom's €2.15bn for the same bands of spectrum.
Telefónica's German arm spent €1bn on 70MHz in the 3.6GHz band plus €381mln for 20MHz in the 2GHz band, while Drillisch spent €0.74bn 50MHz in the 3.6GHz band and €335mln for 20MHz in the 2GHz band.
Chief executive Nick Read said: “Vodafone is committed to bring the full benefits of a digital society to Germany through our gigabit network including 5G. We believe it is important to have a balance between the price paid for spectrum and our strong desire to create an inclusive society through investment in mobile network coverage.”
Analysts weigh in
Analysts at Mainfirst said Vodafone “seem to have come off worse” in the auction.
Deutsche Bank noted reports that Vodafone's UK business is likely to switch off its 3G network in three years in order to deploy lower-frequency spectrum for 5G as it looks to try and narrow the spectrum gap with Three, which announced on Monday that it would launch 5G in August with the highest speeds, helped by a superior spectrum position.
"It will be interesting to see whether Vodafone plumps for 5G premium pricing (EE charges an extra £5) or provide 5G as a free upgrade, which we understand will be Three's approach on launch."
But Vodafone shares were up 1.2% to 130.90p after just over an hour of trading on Thursday.