Bandwidth bidding war concludes

The bidding war between the nation’s top mobile carriers to secure more bandwidth has come to a close after only eight rounds of bidding, the Ministry of Science, ICT and Future planning said Monday.

In 2011, a similar auction for bandwidth on the 1.8-gigahertz (GHz) frequency went 83 rounds. More bandwidth allows telecommunication providers to offer better quality and speed. This makes bandwidth directly related to the competitiveness of each company, which are willing to spend hundreds of billions of won to acquire it as a result. At this year’s auction, the third for bandwidth since 2011, a total 140 megahertz (MHz) of bandwidth over four frequency bands - 700MHz, 1.8GHz, 2.1GHz and 2.6GHz - were put up for auction. The bandwidths were divided into five blocks, one block per frequency band with two blocks offered on the 2.6 GHz band.

The nation’s largest mobile carrier SK Telecom took the most bandwidth, acquiring the 40MHz and 20MHz blocks on the 2.6GHz band for 1.2777 trillion won ($1.12 billion). KT took 20MHz on the 1.8GHz band for 451.3 billion won, while LG U+ took 20MHz on the 2.1GHz frequency band for 381.6 billion won.

Except for the 40MHz block on 2.6GHz band bought by SKT, biddings for all other blocks closed at the minimum bid prices. Total spending by the three carriers was 2.1106 trillion won, lower than earlier expectations that fierce competition could bring up total spending to as high as 3 trillion won.

Bidding on the 700MHz band was dropped without a winner. Concerns that broadcasting and telecommunication frequencies on the band could jam easily were cited as the major reason carriers opted not to place bids.

“This auction allocated the bandwidth necessary ... without overheated competition like the last two,” said an official from the ICT Ministry.

BY KIM JEE-HEE [kim.jeehee@joongang.co.kr]