5G spectrum auctions – the show must go on in APAC

  • 5G rollout didn’t go quite as planned this year, for obvious reasons
  • But, with 5G’s economic impact poised to help economies recover, the show must go on
  • Spectrum are proving a challenge, but they’re a key part of 5G implementation 

2020 was expected to be the year of 5G. Leading carriers across the Asia-Pacific region had already launched the fifth generation technology in 2019, the rollout of 5G was ramping up, and new 5G-ready devices were in the product pipelines of major manufacturers. 

But like many other segments of the economy, the coronavirus (COVID-19) pandemic is slowing down 5G implementation – the technology penned as the backbone for Industry 4.0 tech, autonomous vehicles and smart cities, and much more. 

According to a report by GlobalData, one of the key challenges for mobile network operators has been securing spectrum. This has been a “constant challenge” both leading up to, and amid the pandemic. 

5G spectrum is acquired at auctions held by national regulators. These see operators place bids for airwaves to determine the amount of spectrum they get. The carriers then will bid to decide on the specific frequencies that are allocated. 

Largely due to financial issues – with carriers needing to shore up funds for other parts of their operations – but also due to health concerns, 5G spectrum auctions have actually been put on hold in some parts of the world, such as Spain, which greatly slows down the pace of 5G implementation and infrastructure development. 

In parts of Asia, however, regulators have pushed on, knowing that spectrum auctions are critical for the swift roll-out of 5G. 

In Thailand, regulators managed to raise more than US$3.2 billion in a recent 5G spectrum auction, with operators securing 48 licenses. Officials believe that the fifth-gen network deployment will fuel the country’s digital economy, driving at least 177 billion baht (US$5.5 billion) this year. 

Owed to financial uncertainty, New Zealand took a different tact. With a spectrum auction set to take place in May, the NZ government decided to instead take a direct allocation approach, meaning spectrum was assigned for a set fee. 

“At a time when the impact of Covid-19 means operators are having to make tough calls on how they spend their capital, it needs to be focused on the networks delivering the capacity people need – and can use – today,” said Mark Aue, CEO of NZ-based telecom 2degrees.

“This will provide time for 5G use cases to develop, and initial deployments, in advance of long term spectrum rights that will power national 5G services from late 2022.”

GlobalData research director, Siow Meng Soh, said regulators in can help the region’s preparedness by providing “greater transparency and visibility into their spectrum planning, allocation time-frame as well as regulatory changes.

“Greater certainty on spectrum availability will enable mobile operators to plan their investment and activities to get new 5G services to the market in a timely manner.”

It is still possible for spectrum auctions to be carried out while addressing health concerns, Soh added, with regulators able to set up online auctions or take extra precautions for on-site auctions. 

Hungary for example, had on-site health monitoring during its 5G auction process and enforced social-distancing precautions.

In other jurisdictions, regulators undertook temporary relief measures to give mobile operators access to additional spectrum to increase network capacity. 

In the US, the FCC has allowed major operators Verizon, AT&T, T-Mobile and US Cellular to temporarily borrow spectrum from existing licensees in the 600 MHz and AWS frequency bands (1700 MHz / 2100 MHz) for a 60-day period. 

While there may be logistical and financial challenges in securing 5G spectrum, it could be worth pushing on. “In the long-term, 5G and the ecosystem around it will be a major contributor to the economy and facilitate economic recovery post-COVID,” said Soh.

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