South Korea has opened the bidding for spectrum in the 28 GHz band, a contest designed to bring a fourth mobile network operator into the market.

The spectrum auction is taking place to re-allocate frequencies seized from the country’s three existing mobile players, SK Telecom, KT Corp and LG U+, last year and the year before. The big three had their 28 GHz licences withdrawn after failing to meet rollout targets and the government pledged to use the spectrum to bring in new competition.

The country’s Ministry of Science and ICT on Thursday revealed that the first day of bidding had concluded after six rounds, the running total having reached 75.7 billion won (US$57 million). The contest began at a base price of KRW74.2 billion.

The ministry namechecked one bidder – Sejong Telecom – in a Korean language statement, but it is not clear why.

According to Korea JoonAng Daily, Sejong Telecom is one of a trio of bidders, the other two being Stage X and My Mobile Consortium.

The contest will take part over 50 rounds, the paper explained, so we could see a result in a couple of weeks. Should more than one contender still remain in the running at that point, the spectrum will go to the highest bidder. The paper noted that the final price paid will likely be in the region of KRW100 billion.

That is some way shy of the cash stumped up by SK Telecom, KT Corp and LG U+ back in 2018. The government auctioned off 28 GHz frequencies alongside 3.5 GHz, but while there was some competition for the latter, all three operators picked up 800 MHz of 28 GHz spectrum at the reserve price – around KRW207 billion each.

The band was available for use from the end of that year and the operators were required to use it to deploy 15,000 base stations within three years.

However, they channelled all of their energies into rolling out 5G at 3.5 GHz and largely ignored the mmWave. The government eventually got fed up of them dragging the heels and withdrew the licences, KT Corp and LG U+ in 2022 and later SK Telecom, which had made more of an effort but still only managed 1,650 sites by May 2023.

The government immediately set about discussing re-allocating the licences to other players and recognised that it would need to add various incentives to the T&Cs to attract interest; essentially, financial incentives to help new 28 GHz operators manage their investment burden and improve the business case.

That could well be the reason for the relatively low base price in this auction. Further, according to Korea JoonAng Daily, the winning bidder will have to build out 6,000 base stations nationwide within the first three years, as well as implementing certain measures to deal with frequency congestion and interference.

That base station target is only a third the size of that imposed on the MNOs in 2018, something that again suggests the state recognises that any new player will need a bit of a leg up.

It will still be a tall order to build a successful business based on 28 GHz, but the revised licence terms should help.

Original article can be seen at: