4th Mobile Carrier Buys 400 Billion KRW Worth of '28GHZ' with High Initial Investment... "Saw Future Value"

'StageX' Secures 28GHz Frequency Allocation
Roaming Improvements and Up to 400 Billion Policy Financing

The government's project to create the '4th mobile carrier,' which had been attempted seven times since 2010 but failed, was completed after 14 years. Attention is focused on StageX's bold move to secure the business rights with a bid in the 400 billion won range, far exceeding the initially expected price.

According to the Ministry of Science and ICT on the 1st, StageX was selected as the designated corporation in the 28 GHz band frequency auction for 5G mobile communication services held on the 31st of last month. StageX is a consortium centered around StageFive, a tech-based telecommunications operator spun off from Kakao, with Shinhan Investment Corp participating as a financial investor.

Although the auction price was initially expected to be around 100 billion won, StageX participated in the second-stage sealed bidding along with MyMobile (Future Mobile consortium) and won the business rights at 430.1 billion won. StageX pushed forward to acquire the business rights at a higher-than-expected bid price because it highly valued the future potential of the frequency. The 28 GHz frequency band is faster than the currently used 3.5 GHz for 5G mobile communication services but has low diffraction, making it difficult to reach far distances by avoiding obstacles. Therefore, it has the disadvantage of requiring denser terrestrial base stations. The cost of installing 6,000 base stations is expected to be at least in the 200 billion won range. This means the initial investment cost is relatively high.

[Image source=Yonhap News]

Government support measures also had an impact. To ensure smooth service provision in the early stages of market entry, improvements were made to allow shared use (roaming) of other companies' networks, and policy financing up to 400 billion won, tax credits, and device distribution support were promised. At the 'Korea Digital Spectrum Plan Public Forum' held the day before, a Ministry of Science and ICT official stated regarding the priority supply of the 2.3 GHz band frequency to new operators, "We will provide maximum support so that operators who demonstrate sincerity in their networks can gain competitiveness."

Professor Mo Jong-hoon of Yonsei University's Department of Industrial Engineering said, "Without substantial government support, the 4th mobile carrier is economically impossible."

There are indications that StageX plans to utilize government support policies in its planned B2C (business-to-consumer) services. After winning the frequency auction, StageX announced plans to provide nationwide 5G services by combining ultra-high-speed 28 GHz hotspots with cloud core networks and roaming using the networks of the existing three mobile carriers. To promote competition in the telecommunications market and reduce the burden of device purchase costs, they also plan to distribute 5G 28 GHz band devices through strategic partnerships with Samsung, Apple, Google, Foxconn, and others. A StageFive representative participating in the consortium said, "(Government support measures) will obviously be helpful, and we are also making efforts on our own."

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