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Auction for 2.1 GHz Frequency emerges as ‘Hot Potato’…“needs to be auctioned by The Rule vs. Reallocation is more Efficient”
09/15/2015 | By Kim, Yongjoo (kyj@etnews.com)

 

Method to auction 2.1 GHz frequency bandwidth emerged as an issue for industry.

 

It is an issue because a possibility was brought up that 80 MHz range out of 100 MHz bandwidth range can be reallocated to previous users.

 

To guarantee convenience of users that currently use this frequency, some people are suggesting that reallocation is more efficient. However it seems that there will be a battle between parties as there are criticisms that reallocation violates a principle that states that frequency with expired period of usage needs to be relocated through an auction.

 

According to telecommunication industry, Ministry of Science, ICP and Future Planning (MSIP) will tentatively confirm a direction that frequency allocation 226 including reallocation will be going by end of next month.

 

According to Radio Regualation Law, MSIP needs to notify telecommunication businesses about whether or not 100 MHz range out of 2.1 GHz bandwidth, which its period of usage will expire in December of 2016, can be reallocated a year before its expiration date. MSIP will decide on basic policy by end of next month and will confirm its plan in November.


Currently SK Telecom and KT are using 60 MHz and 40 MHz range respectively out of 100 MHz range from 2.1 GHz bandwidth, which is a subject of allocation. Although 20 MHz out of 60 MHz range is confirmed through an auction for frequency, there are controversies because a method for allocating rest of range has not been decided yet.


Auction For 2.1 GHz Frequency Emerges As ‘Hot Potato’…”Needs To Be Auctioned By The Rule vs. Reallocation Is More Efficient”
In principle, 20 MHz that is confirmed and 80 MHz range need to be allocated through an auction. But the fact that SK Telecom and KT are currently using them for 3G and LTE is a problem. A core point of controversies lies on whether or not reallocation is needed for these two companies that are currently using frequencies.


Opinions from two parties disagree heavily. One side criticizes the other that auction without reallocation violates a principle that is based on ‘allocation of frequency according to a price’. If the government makes businesses pay a price that it has calculated without any competition for prices, it will decrease frequencies’ prices which will cause great loss for the government.


On the other hand, objection about protecting users is also very strong. Telecommunication businesses argue that if a use of many frequencies is terminated for previous users, terminal chips need to be replaced one by one so that corresponding users can use communication service in other frequency bandwidth.


When MSIP confirms a method between reallocation and auction, it seems that telecommunication businesses will greatly oppose according to their interests.


“According to Mobile Gwanggaeto Plan 2.0, only 20 MHz range out of 2.1 GHz bandwidth was confirmed to be auctioned and there is no confirmed allocation plan for the rest. We are going to finalize our decision after discussing with industries.” said one person affiliated with MSIP.


 

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