The Korean government announced plans to award spectrum in the 28 GHz band to a new mobile operator in a move to boost competition in the domestic mobile market.
The 28 GHz spectrum has a narrower coverage area compared to the 3.5 GHz band, but it has a higher speed and lower latency. In particular, the new operator will be given the priority to use one of the two frequency bands in the 28 GHz band, while the other band will be allocated three years after the first operator launches the service, according to the Ministry of Science and ICT.
The decision was made as a result of current changes regarding the spectrum usage rights happening in the telecom sector in Korea recently. At the beginning of this month, the Korean government effectively canceled the spectrum licenses in the 28 GHz band that had been previously allocated to local operators for 5G deployments, due to the lack of investment and missed rollout requirements. Consequently, local operators KT and LG Uplus lost the right to use the 28 GHz frequencies they had won in a spectrum auction in 2018. Meanwhile, South Korea’s largest mobile operator, SK Telecom, had its use time of the 28 GHz spectrum reduced by six months. The telco will also lose the right to use the spectrum completely if it fails to deploy 15,000 radio stations that use the 28 GHz spectrum by the end of May 2023.
The three aforementioned operators had secured frequencies in the 3.5 GHz and 28 GHz bands in an auction in 2018, under the condition that they each deploy 22,500 and 15,000 radio stations for each spectrum band. The government now noted that the telcos had fulfilled the stipulated number of radio stations for the 3.5GHz spectrum but all failed to reach the deployment goal for the 28GHz frequencies.
Therefore, the 28 GHz spectrum will be allocated to the new operator only, during an initial three-year period in order to be able to secure its market position. Financial benefits, including tax benefits and loans, will also be provided to the new entrant, the ministry added.
“The government is giving businesses an opportunity to enter the market, one in which they can take their time, considering that it might be hard for them to make new investments in the 28 GHz band due to rising economic uncertainties at home and abroad,” the ministry said. It is also highlighted that the process to select a new 5G operator will start in the second quarter of 2023.
In June 2018, the ICT ministry completed an auction for 5G frequencies in which local carriers SK Telecom, KT and LG Uplus secured spectrum to launch 5G services in the Asian nation. SK Telecom and KT each won 100 megahertz in the 3.5 GHz band while LG Uplus had obtained a bloc of 80 megahertz of spectrum. In July 2022, LG Uplus secured an additional 20 megahertz of spectrum to use for 5G.