Auction for 5G frequencies to take place June 15

By Jun Ji-hye

A frequency auction for fifth-generation (5G) networks will take place June 15, the Ministry of Science and ICT announced Thursday.

The nation's three mobile carriers _ SK Telecom, KT and LG Uplus _ will compete for the frequencies to achieve the goal of beginning the world's first commercial 5G services in March 2019.

During a news conference held at the government complex in Gwacheon, Gyeonggi Province, the ministry said the high-end 5G network frequency bands of 3.5 gigahertz and 28 gigahertz will be for sale at the auction.

The ministry will provide 280 megahertz of bandwidth at the 3.5 gigahertz band, and 2,400 megahertz of bandwidth at the 28 gigahertz band.

The minimum bid for the 3.5 gigahertz blocks is 2.65 trillion won ($2.5 billion) with a period of use for 10 years, and for the 28 gigahertz blocks is 621.6 billion won with a period of use for 5 years.

The ministry has set the limit on the maximum amount of frequencies that can be assigned to one mobile carrier, adding this is to offer all players opportunities to attempt 5G innovation under similar conditions.

Under this rule, a mobile carrier can secure a maximum of 100 megahertz bandwidth of the 3.5 gigahertz frequency band, and 1,000 megahertz bandwidth of the 28 gigahertz frequency band.

“I ask all competitors to strive to take the leadership in the global market of the Fourth Industrial Revolution, beginning with the provision of 5G frequencies,” said ICT Minister Yoo Young-min.

Differing reactions from mobile carriers

The three telecommunication companies expressed different reactions to the ministry's announcement _ SK Telecom expressed regret, while the other two welcomed it.

The top mobile carrier said customer convenience has not been sufficiently considered when the ministry decided to put a cap on the maximum amount of the frequency band of 3.5 gigahertz that can go to one company to 100 megahertz bandwidth. The firm originally wanted to secure 120 megahertz of bandwidth.

The frequency band of 3.5 gigahertz is considered important as it would be used to build a nationwide network.

“It is regrettable that the ministry set the limit on the effective use of limited resources,” an SK Telecom official said. “Measures to provide additional frequencies should be urgently drawn up to prevent a shortage.”

Meanwhile, KT said the ministry's measure was proper and will help ensure fair competition between the three companies at a time when all of them are at the start line to launch commercial 5G network services.

A KT official noted, “The measure will also correct SK Telecom's previous monopoly.”

LG Uplus said it will make full efforts to lead the global telecommunication market by offering the best 5G services.

The ministry was originally planning to put 300 megahertz of bandwidth of the 3.5 gigahertz frequency band up for auction, but later decided to reduce it to 280 megahertz of bandwidth due to concerns over interference with the LTE frequency in the 2 gigahertz range.

The ministry said it will carry out more studies with experts and officials from mobile carriers to decide on the method and timing for the provision of the remaining 20 megahertz of bandwidth of the 3.5 gigahertz frequency band.

“We will fairly operate the auction process so that frequencies can be effectively distributed and cut-throat competition can be prevented,” a ministry official said.