Carriers to vie for 1.8GHz frequency band

Pedestrians pass by a local handset outlet in downtown Seoul. Amid soaring demand for Long-Term Evolution (LTE) enabled portable devices, the nation's three carriers — KT, SK Telecom and LG Uplus — will bid in an upcoming auction of a license for the 1.8 GHz frequency spectrum to gain a competitive edge in their LTE services. / Korea Times file

By Kim Yoo-chul

Korea's telecommunication industry is expected to see another ''cash war'' as the top regulator plans an additional spectrum auction amid fierce rivalry for fourth-generation (4G) Long-Term Evolution (LTE) networks.

The Korea Communication Commission (KCC) said that it will auction the license for the 1.8 gigahertz (GHz) and 2.6 GHz LTE spectrum bands, respectively, in March at the earliest. KT, LG and SK Telecom have all said they will bid in the auction.

And attention is being paid to which company will get the license, especially the 1.8 GHz band one, which is regarded as the ''golden spectrum.'' More than 42 international mobile carriers are offering their LTE services within that radio frequency.

Currently, KT is using the 1.8 GHz as its main frequency to service its nationwide LTE networks, while the market leader SK Telecom is using the frequency as a secondary position.

The smallest local telecom LG Uplus has so far been using the 1.8 GHz bandwidth to offer outdated second-generation (2G) network services.

"KT is definitely better-positioned to win the bidding for the 1.8 GHz frequency. If it wins the auction, then KT will be able to provide much faster LTE network services. That's why SK Telecom and LG Uplus are trying to persuade the KCC to share the 1.8 GHz frequency,'' said a KCC official, Monday.

The government agency is mulling the possibility of barring KT and SK Telecom from fully participating in an upcoming spectrum auction to ensure fair market competition. KCC officials, who are familiar with the issue, declined to elaborate further by telephone.

''If the KCC grants the green-light for KT to fully handle the 1.8 GHz bandwidth, then we believe that's very unfair as that will give it a huge competitive edge in its LTE services,'' said Kim Seung-han, a salesclerk at LG's authorized outlet in Choongmu-ro, downtown Seoul.

SK Telecom is also calling for the government agency to create fair market competition in LTE services by banning KT from the auction.

"Our demand is simple. KT should be excluded from this auction,'' said an SK Telecom official by telephone, separately, who only wants to be identified as Park.

KT countered, "Radio frequencies are limited and so that means KT should be allowed to handle the 1.8 GHz frequency for qualified services to customers with better pricing.''

Huge demand for premium handsets and new speedier tablet computing devices in Korea has forced all three telecom firms to deploy LTE networks.

"Of course there are concerns about the winner's curse after this race, but they have to win this spectrum desperately for better services,'' said Yang Jong-in, an analyst at Korea Investment & Securities.