Thai 5G auction raises $3B as Singapore bids close

Asian markets have picked up the pace in the march to 5G.

In a busy few days, a Thai auction has raised $3 billion, Singapore telcos have lodged their bids and Taiwan players are set to start crucial talks.

The largest Thai operator, AIS, was the biggest winner in the weekend spectrum auction, acquiring 23 licenses across all three bands, Channel News Asia reported.

The second-biggest telco, China Mobile-backed True Corp, won 17 licenses, and the third-largest, Telenor's DTAC, obtained two. The soon-to-merge state players CAT and TOT acquired six between them, including two in the prized 700MHz band.

The auction raised 100 billion baht ($3.21 billion), with most attention focused on 700MHz frequencies, attracting 51.5 billion baht ($1.65 billion) in bids, according to the National Broadcasting and Telecommunications Commission (NBTC).

Singtel-controlled AIS collected one of the 700MHz licences, as well as ten in the 2.6GHz band and 12 in the 26GHz band. True won nine in 2.6GHz licenses and eight 26GHz licenses.

AIS is expected to launch service in the fourth quarter.

In Singapore, regulator IMDA said it had received three applications for 5G licences when bids closed Monday afternoon. Besides submissions from market leader Singtel and newcomer TPG, M1 and Starhub have mounted a joint bid, IMDA confirmed. (See SE Asia Hops Onto 5G-Sharing Bandwagon.)

Four licenses are on offer, although only two are to be nationwide. The other two are restricted to regional coverage and expected to be enterprise-focused.

The IMDA, which had extended the deadline an extra month to today, will choose the licensees on a basis of network rollout targets and investment commitments.

DBS Group analyst Sachin Mittal said in a January research note that each 5G network would cost upwards of S$1 billion ($719.8 million) over the first five or six years, compared with the S$600 million StarHub spent on its LTE network.

He says TPG, already struggling in the market, would be under increased pressure to exit if it does not win a national license. The Australian-based telco is currently offering a free trial service to 300,000 customers, having invested barely half of its anticipated S$300 million in 4G capex.

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Meanwhile in Taiwan, operators will start formal negotiations on Friday over spectrum allocations.

The five telcos racked up a NT$138 billion ($4.6 billion) bill in the initial stage of the auction – virtually all of it on prized 3.5GHz frequencies. (See Taiwan calls temporary halt on $4.6B auction.)

The sizeable bids, three times above the government's reserve price, are weighing on stock prices and prompting a good deal of discussion about 5G viability.

But the bidders have one more hurdle. In the unusual format devised by the National Communications Commission (NCC), they must reach agreement with each other on which specific spectrum slots they will be assigned.

It will be tricky, though. Analysts point out that besides the limited amount of 3.5GHz spectrum – 270MHz – there will be intense rivalry to acquire the mid-section of the band, which is the cleanest.

If, as seems likely, the operators can't hammer out an agreement, the auction continues and the bids will go even higher.

— Robert Clark, contributing editor, special to Light Reading