Korean operators to invest $3.4 billion in 5G infra in H1 2020: Report
South Korea’s Ministry of Science and ICT said that the country’s three major telecom carriers, SK Telecom, KT and LG Uplus, have agreed to invest KRW 4 trillion ($3.4 billion) in their 5G networks during the first half of this year, The Korea Times reports.
Operators will heavily invest to install additional 5G equipment with the aim of expanding the coverage of current 5G networks across the country.
The announcement follows an agreement between South Korea’s Minister of Science and ICT Choi Ki-young and the management of the three domestic operators.
The initial new investment had been initially set at KRW 2.7 trillion, but has been expanded to KRW 4 trillion. The additional investment will be used to deploy 5G infrastructure in subways, railroads, department stores and universities, according to the report.
As of the end of January, the three operators had deployed approximately 92,000 5G base station across the country, which represents nearly 10% of total LTE base stations in South Korea.
SK Telecom, the country’s largest mobile operator, expects to reach 6-7 million subscribers in the 5G segment by the end of 2020, the company’s CFO, Poong-Young Yoon, recently said during a conference call with investors. At the end of last year, the operator had reached 2.08 million 5G subscribers, the executive said.
Rival operator KT ended 2019 with a total of 1.42 million subscribers in the 5G segment. The telco experienced a slowdown in the adoption of 5G subscriptions as net additions during the last quarter of the year amounted to 363,000, down from 636,000 in the third quarter.
Meanwhile, LG U+ reported that it closed last year with a total of 1.16 million 5G subscribers. The carrier’s 5G subscriber base increased by 33.1% during the fourth quarter of 2019.
South Korea claimed to be the first country in the world to launch full 5G commercial services on April 3, 2019. 5G coverage in Korea is restricted to urban areas and places where there are a large number of people.
The three Korean telcos launched limited 5G commercial services in December 2018 as part of an agreement with the ICT ministry to launch simultaneously to avoid excessive competition. The three mobile carriers initially launched the 5G service in limited areas in Seoul.
In June 2018, South Korea completed a tender process through which it awarded spectrum in both the 3.5 GHz and 28 GHz bands. The government made available a total of 280 megahertz in the 3.5 GHz spectrum band and 2,400 megahertz in the 28 GHz band. The spectrum was divided into 28 blocks and 24 blocks.
Participant operators SK Telecom, KT, and LG Uplus had a 10-block cap per spectrum band. The telcos paid a total of 3.6183 trillion won ($3.3 billion) for the spectrum, 340 billion won higher than the starting price of 3.3 trillion won.
The 3.5 GHz band licenses cover a ten-year period and the 28 GHz band licenses a five-year term.
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