The Birth of the 4th Telecom Operator... StageX Wins 28GHz Frequency Bid (Comprehensive)

After 7 Failures and 8 Attempts... Sealed Bidding Decided on Day 5
Winning Bid 430.1 Billion Won... Twice the Existing Three Telecom Companies

StageX has been selected as the fourth mobile carrier, attracting significant attention.

The Ministry of Science and ICT announced this on the 31st of last month after concluding the fifth day of the 5G 28 GHz frequency band auction held at the IT Venture Tower in Songpa-gu, Seoul. StageX submitted a bid of 430.1 billion KRW, surpassing MyMobile to secure the frequency band. This amount is 355.9 billion KRW higher than the minimum competitive price of 74.2 billion KRW. It also marks 2.06 times the winning bid price of the 28 GHz band by the existing three telecom companies in 2018, which was in the early 200 billion KRW range.

On the morning of the 31st, when the auction for the 5G 28GHz frequency band to select the 4th mobile carrier resumed, Han Yoon-je, the bidding agent of StageX, was entering the IT Venture Tower in Songpa-gu, Seoul.
[Image source=Yonhap News]

Originally starting as a three-way contest, the auction proceeded as a two-party competition for five days after Sejong Telecom withdrew on the first day. On the final day, all 50 rounds of the scheduled first-stage multiple-round ascending bids were completed without a winner being decided. Subsequently, a second-stage sealed bid was conducted from 7 PM, and it was only after 9 PM that StageX was selected as the frequency allocation recipient. This moment marked the fruition of the government’s efforts to find a fourth mobile carrier, which began in 2010, on its eighth attempt.

StageX, having been allocated the frequency, is required to build 6,000 base stations nationwide over the next three years and fulfill obligations such as avoiding frequency interference. The StageX consortium, led by StageFive?a budget phone company spun off from Kakao?has reportedly secured funding of around 800 billion KRW with Shinhan Investment Corp. participating as a financial investor (FI).

StageX is preparing to expand its own lineup of mid- to low-priced devices, including the newly allocated 28 GHz frequency band, in line with its three main goals: revitalizing competition in the domestic telecom market, reducing household communication costs, and establishing an innovative ecosystem based on 5G 28 GHz. To this end, it has formed a strategic partnership with a mobile device manufacturing affiliate within Foxconn.

According to the frequency allocation conditions, StageX plans to build more than 6,000 wireless base stations across 90 hotspots over the next three years, aiming to offer 'Real 5G Innovation Services' targeting both B2B (business-to-business) and B2C (business-to-consumer) markets.

Considering the characteristics of this frequency, the company intends to prioritize deployment within leading enterprises and organizations in various sectors such as universities, hospitals, stadiums, concert halls, and airports. After sufficient verification, it plans to expand the service. In this process, StageX will conduct verification jointly with the KAIST ICT Research Center, implement the 'Real 5G Innovation Service' environment with Yonsei Medical Center, and collaborate with major stadiums and concert halls to develop telecom business models suited for K-content, the company stated. Additionally, it plans to provide fast communication services using the 5G 28 GHz frequency band to both domestic and international users at international airports.

However, there are skeptical views about whether the company can successfully establish itself as the fourth mobile carrier expected by the government and consumers. Although the 28 GHz frequency band is essential for ultra-high-speed, low-latency 5G services, it has poor diffraction, meaning it cannot reach far distances while avoiding obstacles, necessitating many base stations. The existing three telecom companies returned this frequency band due to poor business viability, as they failed to fulfill base station installation obligations. Therefore, it is considered unrealistic to expect a new operator to immediately provide widespread communication services that consumers can tangibly experience using a frequency band even the existing three carriers abandoned.

There are also concerns about whether capital procurement will proceed smoothly, but the company maintains that there are no issues.

Minister Lee Jong-ho of the Ministry of Science and ICT expressed gratitude for the efforts of the applicant companies that competed in good faith until the end, stating, "With the selection of the 28 GHz band allocation recipient finalized, we will support the new operator to settle early in the market."

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