Taiwan calls temporary halt on $4.6B auctionTaiwan calls temporary halt on $4.6B auction
Taiwan's regulator has put its 5G spectrum auction on hold following the withdrawal of one bidder.
January 17, 2020
Taiwan's 5G auction has completed its first round in near-record territory, with the five operators committing NT$138 billion ($4.6 billion) for more than three times the government reserve price.
Just over NT$137 billion went to the 3.5GHz band, putting the medium-sized Asian economy third behind Italy and Germany in aggregate spending and second in terms of spending per megahertz. Bids for the 28GHz frequencies raised about NT$1 billion.
But the auction isn't over. The regulator, NCC, called a halt Thursday morning after the smallest player, Hon Hai-backed Asia-Pacific Telecom, withdrew from 3.5GHz bidding.
The process will resume on February 21, when the operators are expected to negotiate with each other for specific frequencies within the spectrum bands. The NCC said it would step in only if they are unable to reach agreement.
The biggest winners were Chunghwa Telecom, the number-two operator, which bid NT$45.7 billion for 90MHz of 3.5GHz spectrum, FarEasTone, which committed $40.6 billion for 80MHz, and Taiwan Mobile, which will pay NT$30.45 billion for 60MHz.
Source: NCC Units.
Local credit agency Taiwan Ratings has warned that with debt loads already expected to rise to fund the 5G rollout, the unexpected high cost of spectrum is adding further pressure. It forecasts operators may "adopt a more conservative approach to infrastructure deployment."
Investors aren't too thrilled, either. Since the auction began a month ago, they've marked Taiwan Mobile down 4.4% and FarEasTone 2.1%. Chunghwa's stock is unchanged.
Chunghwa Telecom, the part state-owned giant, has forecast annual 5G investment of up to NT$9-10 billion ($300-334 million), with total cost expected to significantly overtake its total NT$60 billion investment in 4G.
Want to know more about 5G? Check out our dedicated 5G content channel here on
The official Central News Agency reported that telco execs have said privately that, because the sum raised far exceeds the government's anticipated revenue take, they expect relief measures in the form of tax cuts, incentives, basestation subsidies or other measures.
So far none of these has materialized, but NCC Acting Chairman Chen Yaw-shyang says the government can introduce "administrative measures" to ensure consumers enjoy access to "high-quality and affordable" 5G.
He said the Taiwan cabinet would hold an interdepartmental meeting to discuss distribution of the auction proceeds, including investment in upgrading telecom infrastructure, Taipei Times reported.
The Taiwan Telecommunications Industry Development Association (TTIDA) has also called for 5G to be exempt from spectrum usage charges and for a delay on the issue of spectrum for private network services. (See Taiwan's Telcos Seek Govt. Help as 5G Auction Blows Out.)
— Robert Clark, contributing editor, special to Light Reading
Read more about:Asia
About the Author(s)
You May Also Like
5G Network Automation and AI at Global Megaevents: A Telco AI-at-scale case study with Ooredoo and EricssonOct 10, 2023
5G Transport & Networking Strategies Digital Symposium.Oct 26, 2023
Improve Service Efficiency in the Call Center and Field with Slack AutomationOct 13, 2023
Open RAN Evolution Digital Symposium Day 1Jul 26, 2023