What Do Current 5G Spectrum Auctions Tell Us About its Business Case?

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2Q 2018 | IN-5123


United Kingdom Becomes the First Major Country to Hold 5G Auction


On April 5, 2018, United Kingdom’s telco regulatory authority Ofcom completed auction of 5G spectrum in the 3.4 GHz band. The four winners included Vodafone, O2, Three UK, and EE Limited, and the auction raised US$1.64 billion in revenue. The results were the following for a total of 150 MHz:

  • O2 won 40 MHz, paying about US$447 million (US$11.18/Hz).
  • Vodafone won 50 MHz, for which it paid US$532 million (US$10.65/Hz).
  • EE paid US$427 million for 40 MHz, and (US$10.68/Hz).
  • Three UK won 20 MHz, paying US$231 million (US$11.57/Hz).

The auction experienced a delayed start primarily due to regulations on the amount of spectrum an operator could bid for in the auction and the amount it could hold in total after the bidding. While legal appeals by Three UK and O2 to reduce the cap were rejected, Three UK had a year earlier completed the acquisition of U.K. Broadband and its spectrum in 3.4 GHz to 3.8 GHz, 3.9 GHz, 28 GHz, and 40 GHz. Following U.K.’s spectrum auction, South Korea as well as the United…

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