Stage X wins mmWave spectrum to become South Korea’s fourth 5G player


The company’s winning bid of $322.1 million comfortably exceeded analyst expectations

This week, South Korea’s Ministry of Science and ICT has announced the results of its latest spectrum auction process, revealing Stage X as the winner poised to become the country’s fourth national mobile network operator.

Stage X, owned by a consortium led by tech giant Kakao Corp., placed the winning bid of $322.1 million for a licence in the 28 GHz (‘mmWave’) band.

As part of the licencing terms, Stage X will be required to build 6,000 base stations nationwide within the first three years and implement various measures to address frequency congestion and interference.

“We will work to become a new brand in the communications market and facilitate fresh and innovative changes in the market by boosting the 5G network service,” said Stage X CEO Seo Sang-won in a statement.

South Korea’s relationship with mmWave spectrum has been somewhat fraught. All three of the country’s major mobile operators – SK Telecom, LG U+, and KT – won five-year spectrum licences in the 28 GHz back in 2018, paying a collective $463.7 million for the privilege. These licences carried rollout obligations, with the group required to jointly deploy 15,000 mmWave base stations by 2021.

However, all the operators missed these targets by significant margins, instead focussing their 5G rollout on the more utilitarian mid-band spectrum, leading the South Korean regulator to revoke the mmWave licences of LG and KT entirely in 2022. SK Telecom, which had performed slightly better than its rivals, initially simply had the length of its licence reduced by six months, but its licence was ultimately cancelled too last year due to a lack of improvement.

By the start of 2023, the South Korean Ministry of Science and ICT had already devised plans to reauction the spectrum, notably setting aside a tranche of spectrum for a new market entrant, saying this would drive up 5G competition.

By late last month, multiple parties were reported as interested in acquiring the licence, with three named by media reports as Sejong Telecom, Stage X, and My Mobile Consortium.

Sejong Telecom is an existing internet service provider and mobile virtual network operator, while Stage X and My Mobile Consortium are purpose-built partnerships between various tech firms to participate in the spectrum auction.

Having won the auction, Stage X says it plans to work alongside major smartphone manufacturers like Samsung, Apple, and Google, to develop mmWave 5G-capable smartphones.

This is certainly an interesting proposition. mmWave is characterised by shorter range and penetration than more traditional midband 5G but has considerably higher speeds. As such, operators have typically focussed their mmWave projects on more focussed deployments thus far, such as for backhaul or fixed wireless access services – the latter having been a huge success in the US, and increasingly elsewhere.

Using mmWave spectrum for 5G mobile subscriber connectivity will be more challenging, requiring denser (and therefore more expensive) infrastructure deployments to ensure consistent coverage. On the other hand, customers connecting to mmWave 5G will have access to incredible speeds, potentially enabling far more extravagant 5G-adjacent, latency-sensitive services, such as extended reality.

So far, most operators around the world have baulked at the idea of such largescale deployments of mmWave spectrum, struggling to see the business case as viable, particularly in today’s economic climate. But if there is any 5G market in which mmWave 5G smartphones could prove a success it is South Korea, with its strong consumer appetite for the latest technologies and services.

Stage X now has three years to prove the business case for consumer mmWave. The company’s rivals will surely be watching closely.

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