Government, mobile carriers agree frequency redistribution price

The redistribution price for 2G, 3G and 4G network frequency bands has been set between 3.17 trillion won ($2.86 billion) and 3.77 trillion won, ending a months-long dispute between the government and telecoms companies.

The specific amount that carriers have to pay is based on the number of 5G base stations they will build in the next two years.

Mobile carriers will lose their rights to operate on the frequency bands currently used for 2G, 3G and 4G network in June 2021. After the redistribution, the bands will be used for the companies’ 5G wireless network.

According to the Science Ministry on Monday, the exact price will differ according to the carriers' investments in 5G base stations.

The lowest price, 3.17 trillion won, will be offered if companies have installed more than 120,000 5G base stations in the country by 2022. The price will increase up to 3.77 trillion won if they stop at setting up 60,000 to 80,000 5G base stations.

At the moment, SK Telecom, KT and LG U+ operate around 50,000 5G base stations in total.

After negotiations with the carriers, the Science Ministry backed down from its original plan requiring the companies to establish more than 150,000 base stations in order to pay the minimum 3.2 trillion won. The highest price was set at 3.9 trillion won, if the three stop at setting up 60,000 to 90,000 stations by 2022.

Carriers, on the other hand, had argued against such standards, saying 1.6 trillion won was the appropriate price they had calculated with external experts.

“During the previous open discussion, telecommunication companies stressed that establishing 150,000 5G base stations by 2022 was realistically impossible,” said Oh Yong-soo, a Science and ICT Ministry official in charge of frequency policies, during a press conference, Monday.

“The new standard of 120,000 5G base stations was decided as it was slightly higher than the 5G investment plan the three companies had announced in June.”

Despite the price being more than double what they had suggested, the three mobile carriers said in Monday statements that they would “respect” the ministry’s decision and do their best to expand investments in 5G infrastructure.

BY SONG KYOUNG-SON [song.kyoungson@joongang.co.kr]