Germany's internet is slow because it relies heavily on unbundling, implemented poorly: https://www.telekom.com/en/media/media-information/archive/f.... Telekom has little incentive to invest in upgrading its infrastructure because it has to lease it out to its competitors anyway.
Contrasting Germany and the U.K. offers a really good illustration of how important it is to set incentives correctly. The U.K. also relies heavily on unbundling, through BT. But when British Telecom was privatized, the U.K. intensely studied the issue of how to set the appropriate incentives: http://www.bath.ac.uk/management/cri/pubpdf/Conference_semin.... The end result was a regulatory structure where rates were set such that BT ended up being very profitable. (Last year, BT's profit margin was around 16%, versus 3% for Telekom.) That created the incentive for BT to invest in pushing fiber further into its DSL network.
Contrasting Germany and the U.K. offers a really good illustration of how important it is to set incentives correctly. The U.K. also relies heavily on unbundling, through BT. But when British Telecom was privatized, the U.K. intensely studied the issue of how to set the appropriate incentives: http://www.bath.ac.uk/management/cri/pubpdf/Conference_semin.... The end result was a regulatory structure where rates were set such that BT ended up being very profitable. (Last year, BT's profit margin was around 16%, versus 3% for Telekom.) That created the incentive for BT to invest in pushing fiber further into its DSL network.