Operators in Germany are acting despondent after a spectrum auction reached a price they claim could limit their ability to invest in 5G network deployments. Following 497 rounds of bidding that begin in mid-March, Germany’s regulatory agency banked $7.4 billion for 420 megahertz of spectrum in the 2 GHz and 3.6 GHz bands earmarked for 5G mobile services.

Dirk Wössner, head of market leader Deutsche Telekom Germany, said “the auction leaves a bitter aftertaste,” and Vodafone Germany CEO Hannes Ametstreiter described the final price tag as “catastrophic.”

The auction also reinforced 1&1 Drillisch, a new player that bid $1.2 billion for 70 megahertz of spectrum. The outcome all but ensures that the company, which has operated as a mobile virtual network operator (MVNO) thus far, will become a viable fourth operator in Germany. “With this step, 1&1 Drillisch has laid the foundation for a successful and permanent positioning of the [company] as Germany’s fourth mobile network provider,” the company wrote in a prepared statement following the auction’s close.

Deutsche Telekom Germany was the biggest spender, acquiring a total of 130 megahertz of spectrum for $2.43 billion, but its management was not happy with what it spent. “The network rollout in Germany has suffered a significant setback. The price could have been much lower. Once again, the spectrum in Germany is much more expensive than in other countries,” Wössner wrote in a prepared statement.

“Network operators now lack the money to expand their networks,” he added. “With the auction proceeds one could have built approximately 50,000 new mobile sites and close many white spots.”

Vodafone Germany also acquired a total of 130 megahertz of spectrum for $2.1 billion. Vodafone Group CEO Nick Read said the operator is committed to widespread 5G deployments despite the high cost paid for spectrum. “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,” he said in a prepared statement.

Telefónica Deutschland is paying $1.62 billion for 90 megahertz of spectrum, bringing its total 5G spectrum holdings to 310 megahertz. CEO Markus Haas said he plans to continue waging a legal battle over auction terms that he called unfair, according to CNBC. “We must learn from our mistakes and from other top 5G nations that are a good nose-length ahead of us. We have blown this chance — the money is going to the finance ministry and not into building networks.”

German telecom operators had similar grievances in 2000, following the auction of spectrum licenses to support 3G services. Operators ended up bidding nearly $43 billion for those licenses.

The new spectrum, which is spread across 41 blocks, won’t be formally allocated until 2021. The 3.6 GHz band will be made available first, followed by the 2 GHz band in 2026.