Omnibus auction to take place in late 2017; spectrum caps will only apply to 1800 MHz band, not 3.4 GHz, government rules.

The Australian government will allow mobile operators to bid for 5G spectrum later this year without placing limits on the amount a single player is permitted to own, the country’s comms minister revealed on Monday.

An upcoming multi-band spectrum auction scheduled for late 2017 will include airwaves in the 3.4 GHz band that Australia, like many other international markets, expects will be used for the provision of 5G services.

Acting on the advice of the Australian Competition and Consumer Commission (ACCC), the government will not place a cap on the 3.4-GHz spectrum, communications minister Mitch Fifield revealed.

"Due to the limited amounts of 3.4 GHz spectrum available in the omnibus spectrum auction, we do not consider allocation limits will sufficiently promote competition to warrant their imposition, and may hinder the economically efficient investment, and economically efficient use of, spectrum," an ACCC document on the matter stated.

Australia is preparing for the sale of what it terms omnibus spectrum, that is, unsold spectrum in the 1800 MHz, 2 GHz, 2.3 GHz and 3.4 GHz bands.

The government has decided to remove existing allocation limits on 2-GHz bandwidth "to allow all telecommunications providers to bid for residual spectrum from previous auctions," but will retain limits on the 1800 MHz band, Fifield’s statement explained.

Like the 3.4 GHz band, there will be no allocation limits on 2.3 GHz.

"Current allocation limits in the 1800 MHz band are sufficient to promote competition as they would allow Vodafone Hutchison Australia (VHA) or TPG to acquire spectrum in the Mackay area where they currently do not have any spectrum holdings in the 1800 MHz band," the ACCC said.

"We also consider that Telstra and Optus hold sufficient spectrum in the 1800 MHz band such that either entity is unlikely to be constrained in the mobile broadband market if it did not acquire further 1800 MHz spectrum in the omnibus spectrum auction," it added.

With regard to the other bands, allocation limits would not promote competition, encourage the economically efficient use of spectrum, nor facilitate a new market entrant, the ACCC said; "a potential carrier could not build a competitive mobile network using only the spectrum available in the omnibus spectrum auction."

However, Australia has more 5G spectrum to offer at a later date. Operators will be able to bid for 125 MHz of frequencies in the 3.6 GHz band, although the country has yet to share its plans for that allocation process.