KT and LG Uplus will have their licences cancelled, while SK Telecom will have their licence term shortened by six months

South Korea is rightly looked to as a world leader in many fields of technology and, for the most part, 5G is no exception.

However, when it comes to mmWave 5G, results in the country have been so disappointing that the government is now moving to remove some of the telcos’ licences altogether.

A recent audit by the Ministry of Science and IT (MSIT) found that all three of the nation’s mobile operators – SK Telecom (SKT), KT, and LG Uplus – have failed to meet their obligations with regards to their mmWave spectrum licences.

According to the Ministry, the operators “did not meet even the minimum requirements for the 28-gigahertz band infrastructure”, having failed to invest sufficiently in rolling out the technology.

The South Korean telcos were first awarded the five-year 28GHz spectrum licences back in 2018, paying roughly $463.7 million for the privilege. As part of the conditions attached to the licences, the operators were obligated to deploy 15,000 base stations each by 2021.

The audit showed, however, that KT had deployed just 1,586 base stations by April this year, while LG Uplus had deployed 1,868, and SKT 1,605.

Considering these deployment figures alongside other licencing criteria, such as network performance and plans for further Deployments, the Ministry judged both KT and LG Uplus to have failed to reach the minimum requirements to retain their licences. As such, the Ministry will be reclaiming both licences.

The revoked licences will be reauctioned, with the government suggesting they will introduce a number of incentives to drive interest from potential suitors. Whether KT and LG Uplus will bid to regain their licences remains to be seen but is unlikely unless service obligations are reduced.

SKT, on the other hand, was deemed to have just barely exceeded the minimum requirements, hence their licence will not be revoked but rather punitively reduced in length by six months.

The Ministry strongly urged SKT to accelerate its deployment efforts, noting that they will still have to deploy the full 15,000 base stations by May 2023.

For the South Korean government, the operators’ lack of interest in mmWave is somewhat concerning.

mmWave spectrum is set to be a mainstay of 6G, the next generation of mobile technology that is set to mature around 2030. The government fears that, without an adequate deployment of mmWave infrastructure over the coming years, the nation will fall behind in the race to 6G supremacy.

“The relative immaturity of the domestic 28-gigahertz bandwidth ecosystem compared to other countries may undermine Korea’s foothold as the leading player in the telecom sector, and therefore is very worrisome,” said the Ministry.

‘Other countries’ here refers to the likes of the US, Japan, and China, all of which have been rolling out mmWave infrastructure at scale for the past two years.

But for the South Korean telcos themselves, mmWave has proved far less inviting. Despite offering far greater data speeds than the more widely used mid-band 5G spectrum, its relatively short propagation range makes it more expensive to deploy. Couple this with the fact that mmWave 5G is not compatible with existing consumer smartphones and you have a relatively niche service proposition, typically limited to enterprise use cases, like smart factories.

For consumers, on the other hand, most of the operators’ commercial 5G traffic currently flows over their 3.5 GHz spectrum, which is not only compatible with existing mobile devices but provides an appealing balance of high speeds and coverage distance.

This is the band where operators have been focussing their investment, with recent reports suggesting that there are over 25 million 5G subscribers in South Korea, accounting for roughly a third of total mobile subscriptions.

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