18 Mai VATM and DIALOG CONSULT Present the 27th Analysis of the German Telecommunications Market
Cologne, 12 May 2026. The digitalisation of Germany and the expansion of high-performance telecommunications infrastructure in both fixed-line and mobile networks continue to be driven primarily by competitors in the market, with significant investment efforts. The latest figures from the 2026 market analysis by DIALOG CONSULT and VATM, based on the overall market data for 2025 and the first months of 2026, provide a detailed view of developments across the various telecom market segments and allow forecasts for anticipated market movements over the course of the year.
• Indicative investment willingness: Companies are investing 24.8 per cent of their revenue, led primarily by competitors in the telecommunications market.
• Gigabit coverage by 2026: 88.6 per cent of all households and SMEs will have access to a gigabit-capable network.
• Fibre reach by 2026 (Homes Passed): The expanding companies will reach 32.0 million households and SMEs (69.0 per cent) with fibre.
• Fibre coverage by 2026 (Homes Connected): The proportion of households with fibre connections will be 26.9 per cent (12.5 million households). Nearly 70 per cent of these are offered by competitors, who have further increased their coverage.
• Fibre subscriptions by 2026 (Homes Activated): A total of 7.8 million customers will be using fibre. Most fibre customers have contracts with competitors (5.1 million). Competitors’ take-up rate stands at 30.2 per cent (Telekom: 17.9 per cent).
• Strengthening of the former monopoly: The ex-monopolist continues to consolidate its position in the fixed-line and business customer markets.
• Fibre forecast for 2031: In the optimistic scenario, fewer than 17 million FTTB/H connections (Homes Activated) will be in use by the end of 2031. DSL will remain the most widely used access technology.
• High-performance mobile networks: Nearly all households and the majority of Germany’s land area will have 5G coverage.
• Growing demand for data: The volume of data transmitted over fixed-line and mobile networks continues to increase.
• Digital services in the AI era: Customer contact via service hotlines remains important.
“The telecommunications sector invests nearly 25 per cent of its revenue in tangible assets,” explains Andreas Walter, Managing Partner of the consultancy DIALOG CONSULT GmbH. This places the telecom sector well above comparable figures from other industries, which typically invest no more than 10 per cent of their revenue. With €9.3 billion, competitors’ investments are once again significantly higher than those of Deutsche Telekom.
In the mobile sector, this financial commitment is reflected in near-complete 5G coverage of households and a network that reaches over 96 per cent of the country’s area.
Competition remains the key driver for fibre-optic provision to households and SMEs (Small and Medium-sized Enterprises) in Germany. By the end of the year, the proportion of homes with fibre connections (Homes Connected) is expected to reach just under 27 per cent, with almost 70 per cent of these offered by alternative providers. Competitors have also consistently outperformed Deutsche Telekom in terms of the number of households subscribing to fibre.
Fibre expansion is progressing, but the path to comprehensive fibre coverage across Germany remains challenging.
“By the end of 2026, network operators had extended their fibre-optic cables to 32.0 million households and SMEs, with some households reached by two carriers,” explains Walter. This corresponds to a reach of 69 per cent. Deutsche Telekom responded relatively late to the competitors’ fibre expansion efforts but is now making significant progress, particularly in terms of Homes Passed. Its take-up rate, however, still lags well behind that of its competitors.
The study also highlights significant competitive distortions in the German telecommunications market. “Deutsche Telekom’s market dominance is increasing year by year,” emphasises the researcher. “This is evident both in the company’s end-customer market share for broadband connections and in its revenues in the fixed-line market. In the important business customer segment, 67 per cent of connections are provided via Telekom’s network. In the DSL market, Telekom’s market share is also growing. At the same time, customers of Telekom’s FTTH connections have struggled for years to achieve any significant market share.”
VATM President Valentina Daiber: “The migration from copper to fibre will bring the market into a new phase. It is essential to manage this transition reliably. This is why the upcoming amendment to the Telecommunications Act (TKG) is so important.”
VATM President Valentina Daiber emphasises, on the occasion of presenting the market analysis, that the latest figures also serve as a reality check for the industry as well as for policymakers and regulators.
Fibre expansion is progressing, but the gap between homes that could be reached and those actually connected remains a key challenge. “A fibre connection that passes a house but is not used is not yet a success for digital transformation,” stresses Daiber. The political task, therefore, is to create a framework that accelerates uptake and ensures a reliable fibre-based future.
The crucial question is how the transition from copper to fibre is managed in order to protect investments, preserve competition, and bring customers along.
“The migration must not lead to a re-monopolisation of the market,” emphasises the President. “We have long observed the strengthening of Telekom. Experience has shown that light-touch regulation is simply not sufficient when structural market power persists. Market problems arising from the behaviour of a dominant company require clear and enforceable solutions. This is why the upcoming amendment to the Telecommunications Act (TKG) must ensure effective asymmetric regulation.”
Equally important in this high-investment phase for the industry is speed. Companies expanding both fixed-line and mobile networks must not be slowed down by unnecessary bureaucracy, duplicate reporting obligations, or lengthy procedures. “VATM has been calling for this for many years,” reminds the President. “Many necessary legislative initiatives are progressing only slowly or are not implemented locally. Municipalities, districts, and states must make official commitments and unlock the acceleration potential that exists everywhere.”
Although 5G expansion in Germany has been a success story, the final few percentage points needed for full coverage remain particularly challenging. “The prioritised power supply for mobile masts must therefore be enshrined in law through the TKG amendment,” urges the President.
Finally, while the focus on infrastructure is important, it must not be forgotten that networks are not an end in themselves. What truly matters are the services, applications, and solutions that emerge on these networks.
“Innovative developments made in Germany must receive strong political support,” Daiber emphasises. “Forward-looking AI solutions that strengthen Germany as a business location require regulations that enable innovation and corporate performance, rather than hinder them.”
VATM expects the TKG amendment to provide a clear regulatory compass: protecting investments, safeguarding competition, enabling migration, preventing abuse, and reducing bureaucracy.
“If this succeeds, the amendment can become a catalyst for fibre, mobile networks, and digital services,” says Daiber. “If it fails, there is a risk of further market consolidation, reduced investment security, and a fibre migration that proceeds too slowly and in a one-sided manner.”
The Telecommunications Market in Detail:
The German telecommunications market is expected to reach €59,7 billion in revenue in 2026. In the fixed-line segment, Deutsche Telekom is increasing its already high market shares at the expense of competitors (see Fig. 2). Of particular importance for Germany as a business location is the highly competitive business customer market, which accounts for one-third of the total market. With €13.8 billion in revenue in 2025, Telekom further strengthened its long-standing dominant position in the business customer segment and is expected to reach a market share of 67% by the end of 2026. For competitors, following a slight decline in 2025, a further 5.6% decrease to €6.8 billion is anticipated for the current year (see Fig. 3).
Investments in the telecom market continue to be driven largely by competitors. In 2025, they invested €9.3 billion in telecom assets, compared with €5.5 billion by Deutsche Telekom (see Fig. 7). Compared with other industries, the telecommunications sector has a high investment ratio, amounting to 24.8% of revenue (Spotlight 1).
Fixed-Line Market:
Among active broadband connections, DSL will continue to dominate until the end of 2026, accounting for more than 57% (21.8 million connections). FTTB/H is actively used in 7.8 million connections (20.5%), while HFC connections make up 22.3%, or 8.5 million connections (Spotlight 2).
In 2025, Deutsche Telekom dominates the broadband market: nearly 66% of all broadband connections are provided via Deutsche Telekom’s network (see Fig. 17).
In the still-dominant mid-term DSL market, Telekom continues to expand its market share. This makes competition-promoting measures on the phase-out of the copper network by the Federal Network Agency even more important (see Fig. 11).
By 2026, approximately 41.1 million households are expected to be capable of receiving gigabit connections. The gigabit coverage rate is projected at 88.6%. Fibre reaches 32.0 million households, as well as small and medium-sized enterprises (SMEs) (see Fig. 12).
The proportion of homes with fibre connections (Homes Connected) is expected to grow to nearly 27% by the end of 2026, equivalent to around 12.5 million households served. Almost 70% of these fibre connections are provided by competitors (see Fig. 14).
By the end of the year, 7.8 million households will have subscribed to FTTB/H connections (Homes Activated), the majority of these with competitors in the telecommunications market. Competitors provide most of the active fibre connections, with a take-up rate of 30.2%, compared with 17.9% for Deutsche Telekom (see Fig. 15).
A closer look at Telekom’s insufficiently regulated FTTH and DSL platforms shows that the dominant company continues to expand its end-customer market share. Competitors have little opportunity to utilise the FTTH platform (see Fig. 16).
The forecast for the development of subscribed fibre connections (Homes Activated) shows the following: Even in an optimistic scenario for fibre development, assuming an annual increase of 1.7 to 2.0 million new FTTB/H connections (Homes Activated) – by the end of 2031, only around 16.5 million fibre connections will be in use. In this optimistic scenario, 13 million DSL connections would still be in use (see Fig. 18).
Mobile Market:
5G coverage in the mobile market is already well advanced. By the end of 2026, the 5G network will serve 99.8% of all households and cover 96.5% of Germany’s land area (Spotlight 5). Mobile network operators continue to invest in connecting base stations with fibre, while microwave links remain important backhaul technology (see Fig. 30).
With an expected increase of 13.4 million new SIM cards by the end of 2026, bringing the total to 227.9 million, the mobile market continues to grow (Spotlight 4 and Fig. 19). More than 96 million SIM cards will be used by the end of 2026 for connecting IT systems and machines (see Fig. 20).
Digital Services:
The data appetite of Germans shows no sign of slowing. In 2026, the volume of data used over fixed-line networks is expected to reach 187.5 billion gigabytes, representing an increase of 12.3% and an average of 412.3 gigabytes per broadband connection per month.
Mobile Data Traffic is also on the rise. The total volume is expected to grow by 14.4% to more than 15 billion gigabytes, with the average mobile data usage reaching 11.5 gigabytes per month per active personal SIM card by the end of 2026 (see Fig. 25).
Instant messaging remains the primary form of personal digital communication. Usage appears to have reached a saturation point, with an estimated total of 2.76 billion instant messages sent per day in Germany in 2026, equivalent to 33 messages per person per day (see Fig. 26).
Digital services continue to show their importance in the AI and chatbot era. Customer contact via service phone numbers and service SMS remains a significant market segment, generating €226 million in revenue. Competitors, who account for 83% of this revenue, provide key services to customers, particularly through toll-free 0800 numbers and geographic numbers (see Fig. 6).
The 27th Telecommunications Market Analysis 2026 by VATM and Dialog Consult can be found here (in german):
VATM-Marktstudien
Andreas Walter is Managing Partner of the consultancy DIALOG CONSULT GmbH and has been observing and analysing the development of the telecommunications market for more than 26 years. He also holds a teaching appointment at Hochschule RheinMain.
Valentina Daiber is President of VATM e. V. and serves as Executive Board Member for Legal & Corporate Affairs at Telefónica Deutschland.
