Germany has raised some 6.5 billion euros (S$10 billion) from the sale of 5G frequencies to telecoms firms, the Federal Network Agency, said Wednesday, announcing the result of a three-month auction.
The sale far exceeded expectations of between three billion and five billion euros, and the windfall will go towards closing the digital gap in a country whose wireless networks rank only 46th in the world for download speeds.
Germany's three main mobile network providers - Deutsche Telekom, Vodafone and Telefonica Germany (O2) - and 1&1/Drillisch, which specialises in internet services, bought the 41 frequency blocks on offer, with Deutsche Telekom taking the lion's share, the network agency said in a statement.
5G is the latest high-speed generation of cellular mobile communications.
It promises radically quicker transfers of data, making possible widespread use of artificial intelligence and other high-tech advancements such as self-driving cars and "telemedicine".
Berlin will require the winning bidders to offer the service to at least 98 per cent of German households and along motorways and rail lines.
The United States has urged Berlin to bar operators from building networks on hardware from Chinese tech firm Huawei, arguing that the equipment could help Beijing spy on Western companies and governments.
Huawei Technologies Co Ltd has told Verizon Communications Inc that the U.S. carrier should pay licensing fees for more than 230 of the Chinese telecoms equipment maker's patents and in aggregate is seeking more than $1 billion, a person briefed on the matter said.
Verizon should pay to "solve the patent licensing issue," a Huawei intellectual property licensing executive wrote in February, the Wall Street Journal reported earlier. The patents cover network equipment for more than 20 of the company's vendors including major U.S. tech firms but those vendors would indemnify Verizon, the person said. Some of those firms have been approached directly by Huawei, the person said.
The patents in question range from core network equipment, wireline infrastructure to internet-of-things technology, the Journal reported. The licensing fees for the more than 230 patents sought is more than $1 billion, the person said.
Huawei has been battling the U.S. government for more than a year. National security experts worry that "back doors" in routers, switches and other Huawei equipment could allow China to spy on U.S. communications. Huawei has denied that it would help China spy.
Companies involved, including Verizon have notified the U.S. government and the dispute comes amid a growing feud between China and the United States. The licensing fee demand may be more about the geopolitical battle between China and the United States rather than a demand for patent fees.
Huawei and Verizon representatives met in New York last week to discuss some of the patents at issue and whether Verizon is using equipment from other companies that could infringe on Huawei patents.
Verizon spokesman Rich Young declined to comment "regarding this specific issue because it's a potential legal matter."
However, Young said, "These issues are larger than just Verizon. Given the broader geopolitical context, any issue involving Huawei has implications for our entire industry and also raise national and international concerns."
Huawei and U.S. wireless carriers T-Mobile US Inc and AT&T Inc did not respond to Reuters' requests for comment. Sprint Corp declined to comment.
The United States last month put Huawei on a blacklist that barred it from doing business with U.S. companies on security grounds without government approval, prompting some global tech firms to cut ties with the world's largest telecoms equipment maker.
Washington is also seeking the extradition of Huawei Chief Financial Executive Meng Wanzhou from Canada after her arrest in Vancouver last December on a U.S. warrant.
China has since upped the pressure on Canada, halting Canadian canola imports and in May suspended the permits of two major pork producers.