The 4th Telecom Operator's Frequency Bid Reaches '200 Billion Won'... Comparable to the Top 3 Telecom Companies

StageX vs MyMobile Two-Way Battle
38th Round Reaches 195.5 Billion Won
Final Amount Expected to Easily Exceed 200 Billion Won

The frequency auction to determine the fourth mobile carrier has entered a two-way battle, escalating into fierce competition. With the bid price rising to 195.5 billion won, attention is focused on whether it will surpass the winning bids of 200 billion won by the three existing mobile carriers (SK Telecom, KT, LG Uplus). As the bid price has jumped to 2.6 times the minimum competitive price, experts predict that whoever wins this competition will inevitably face the 'winner's curse.'

[Image source=Yonhap News]

According to the Ministry of Science and ICT on the 31st, as of the fourth day of the frequency auction held the previous day, the bidding had proceeded through 38 rounds, with the minimum bid price rising from 74.2 billion won to 195.5 billion won, which is 2.6 times the minimum competitive price (74.2 billion won). The winning bids for the frequency band, which had been returned by the three mobile carriers SKT, KT, and LG Uplus, were 207.3 billion won, 207.8 billion won, and 207.2 billion won, respectively. From the first round onward, the minimum bid amount is determined by adding a bid increment within 3% of the highest bid from the previous round, but there is a strong possibility that the bid price will exceed 200 billion won.

The auction, which has become a two-way battle between the Stage Five consortium Stage X and the Mirae Mobile consortium My Mobile, is fiercely competitive with neither side giving up. After Sejong Telecom, one of the candidates, withdrew midway, the two consortia, who had been engaged in a game of nerves, are now competing even more intensely. The bid price increased slightly from 75.7 billion won after 6 rounds on the first day of the auction to 79.7 billion won after 14 rounds on the second day, but from the third day (25 rounds) onward, competition intensified sharply, causing the minimum competitive price to surge to about 141.4 billion won, nearly double.

Concerns about financial capability arose even before the auction began, and worries are growing as the bid price, initially expected to be around 100 billion won, continues to rise. The government specified in the frequency auction announcement that 10% of the allocation fee must be paid before the allocation date, and 100% must be paid in five installments by March 20, 2028, including this initial payment. The final winning bidder must prepare at least 20 billion won in funds before the allocation date.

Additionally, the final winning bidder who becomes the fourth mobile carrier will have network construction obligations in addition to paying the allocation fee. For nationwide coverage, they must build a total of 6,000 units of 28 GHz base station equipment within three years from the allocation date. Both consortia are working hard to secure funding. Stage X has secured 800 billion won in funds with Shinhan Investment Corp. participating as a financial investor, while Mirae Mobile plans to increase its capital to 1 trillion won through a partnership with the global company Vodafone.

However, if the bid price is decided in the 200 billion won range, exceeding 2.6 times the minimum competitive price, the burden will be inevitable regardless of who becomes the final winner. Professor Mo Jeong-hoon of Yonsei University's Department of Industrial Engineering said, "There is talk that at least 1 trillion won is needed to become the fourth mobile carrier," adding, "Even if there is a funding plan, it remains to be seen how things will unfold." He further noted, "With the two companies overheated and the bid price rising, if it goes even higher, the economic burden of installment payments will also be considerable."

The auction will proceed with multiple rounds of bidding up to 50 rounds, and if no consortium withdraws by then, it will switch to a sealed bid method. Since 13 rounds were conducted in one session the previous day, it is expected that a final decision may be reached as early as today.

This content was produced with the assistance of AI translation services.