5G spectrum pricing in Hungary and Taiwan at auctions

GSA has released the latest report on spectrum pricing for LTE and 5G networks during the first quarter of 2020.
Huawei 5G base station in ChinaMany countries are targeting C-Band spectrum as a key resource for 5G, balancing the need to achieve coverage with the need to deliver high capacity, while millimetre wave spectrum (mmWave) is being made available to enable the deployment of much smaller, but higher capacity zones within 5G networks.

Taiwan’s auction of 5G spectrum has ended in January after 261 rounds of bidding, raising a total of TWD138.081 billion or $4.6 billion. Chunghwa Telecom, Far EasTone Telecom, Taiwan Mobile Co and two other rivals bid for licences to the spectrum to operate their 5G networks in Taiwan.

Hungarian regulator National Media and Infocommunications Authority raised about 128.5 billion forints from the sale of 5G mobile spectrum, Reuters reported on March 26, 2020. Magyar Telekom, Vodafone Hungary and Telenor Hungary spent HUF128.5 billion or $400 million for acquiring 5G spectrum licences during the spectrum auction in Hungary.

C-Band auction

25 countries have auctioned or allocated C-Band spectrum with the intention of opening up the frequency range for mobile broadband and 5G usage since 2015. Hungary and Taiwan concluded auctions of C-Band spectrum during the first three months of 2020.

After a bidding war, the fees paid in the recent Taiwanese spectrum auction exceeded all previous auction prices, achieving an average of $0.72/MHz/Pop (with the highest bidder paying $0.74/MHz/Pop) –  much more than the previous maximum of $0.424 per MHz per Pop in Italy.

The Hungarian spectrum auction covered multiple bands, and the government has not released the prices paid for individual spectrum bands.

mmWave auctions

Fewer major mmWave auctions designed to support 5G deployment have yet taken place. The United States completed its major auction of spectrum at 37, 39 and 47 GHz in the first quarter, following up its auctions of spectrum at 24 GHz and 28 GHz in 2019. Taiwan and Thailand also auctioned mmWave spectrum during Q1 2020.

Data for Hong Kong shows the maximum cost over ten years after an initial transition period. Pricing is on an annual basis at nearly $0.0004/MHz/Pop. There is nothing payable in 2019, 30 percent in 2020 and 70 percent in 2021, and 100 percent thereafter; but fees get levied at all if 75 percent of all spectrum in the 26/28 GHz range is used.

The prices paid for mmWave spectrum have been much lower than the prices paid for C-Band spectrum to date, with the price per MHz per Pop ranging from just over $0.001 in the USA for spectrum at 47 GHz to nearly $0.02 per MHz per Pop for spectrum at 24-27 GHz in Thailand.

GSA said the number of countries allocating or auctioning C-Band or mmWave spectrum is expected to grow significantly during 2020. Ongoing or upcoming C-Band and mmWave auctions are currently expected in 33 countries this year.

Baburajan K