Applications open for Australia's sub-1 GHz 5G sale

Australia has formally opened its sub-1 GHz 5G spectrum auction process and interested parties have three weeks to submit their applications for a contest that will take place before the end of the year.

With the country still chasing its ‘Year of 5G’ dream, a buzz phrase it came up with in late 2020 that essentially covers its plans to carry out two spectrum auctions this year, the regulator needed to get its skates on with the second sale. It has 70 MHz of paired spectrum in the 850/900 MHz band to offload via an auction pencilled in for late November or early December.

“The spectrum available in this auction will facilitate a wide range of new services that will benefit businesses and consumers across Australia,” said Australian Communications and Media Authority (ACMA) Chair Nerida O’Loughlin. The low-band sub-1 GHz frequencies are particularly important in a country like Australia, due to their ability to carry signals over long distances.

Thus there should be no shortage of interest in the auction from Australia’s main telcos. But there’s a hint that the state is expecting the process to attract potential newcomers too.

“O’Loughlin said the allocation of 5G-optimised spectrum in the 850/900 MHz band will support new and existing operators to better deliver services across regional, rural and remote areas of Australia, as well as to major population centres,” the regulator’s announcement reads.

We’re probably not looking at new full-scale telco players here, but the frequencies could be useful for companies looking to set up regional fixed wireless services, for example. Perth-based ISP Pentanet won spectrum in Australia’s first 5G auction of 2021 in April, picking up four lots of 26 GHz frequencies, while small cells neutral host Dense Air Australia won two lots.

The big three – Telstra, Optus and TPG Telecom – will likely share the majority of available spectrum though, just as they did with the 26 GHz band.

Optus and TPG will have the added advantage of having spectrum set-aside for them to ensure they are able to continue running their existing services. It has been a subject of debate for some months – naturally Telstra had a few things to say on the subject – but last month the government confirmed it would require the ACMA to guarantee the two smaller players the opportunity to acquire 10 MHz of 900 MHz spectrum to support continuity of services.

“Optus and TPG Telecom rely heavily on their 900 MHz holdings for their national mobile networks,” said a statement from Communications Minister Paul Fletcher.

It’s not all bad news for Telstra though. At the same time the Ministry announced that

auction bidders will be limited to holding 40% of low-band spectrum in metropolitan and populous areas, while holdings will be capped at 45% in remote and sparsely populated areas. There had been talk of maintaining a consistent cap of 40%, but Telstra had been lobbying for a higher limit in the regions.

The ACMA has set a range of minimum prices depending on location and frequency range: the starting price for the lower 900 MHz range is A$0.75 ($0.55) per MHz/pop, rising to A$1.15 ($0.84) per MHz/pop for the 850 MHz expansion and upper 900 MHz ranges. The set-aside spectrum in the upper 900 MHz range is priced at a 25% increase on the base rate, coming in at A$1.44 ($1.06) per MHz/pop. In total, the set-aside frequencies are priced at A$356.8 million ($261.9 million); for the rest, we will have to wait and see.