5G is a key driver in digitalisation, a global mega trend that embraces all areas of society from people’s everyday life to health care and industries. 5G can deliver an attractive combination of high capacity, high reliability, and low latency but only when supported by a balanced set of spectrum resources.

In consequence, telecom authorities globally have continued efforts to ensure that operators have sufficient frequency resources to roll out 5G. In fact, awards of the 5G pioneer bands, 700 MHz, 3600 MHz, and 26 GHz, have been completed in most European markets and have proceeded well in other markets as well. In consequence, operators’ spectrum portfolios are now largely intact, and they can focus on optimising their production setup, to make the most out of their frequency holdings.

5G spectrum auctions in 2022

5G pioneer bands 700 MHz, 3600 MHz, and 26 GHz, provide a combination of low, mid, and high frequencies to deliver both coverage and capacity. So far, the key focus of both mobile operators and authorities has been on the 700 MHz and 3600 MHz; the 26 GHz (millimetre wave) band has remained a niche.

European 5G frequency awards in 2022 include the following: Belgium (700 MHz & 3600 MHz, after a lengthy process), Estonia (3600 MHz), Ireland (700 MHz), Lithuania (700 MHz), Montenegro (700 MHz and 3600 MHz), Romania (700 MHz & 3600 MHz) and Slovakia (3600 MHz)i. Unsurprisingly, awards in the biggest markets raised the most money: Ireland 448 M€, Romania 433 M€ and Belgium 286 M€. In general, however, year 2022 led to no material changes in valuation of spectrum; no new records in €/MHz/pop valuation and relative valuation of low and mid/high bands remained intact. The third 5G pioneer band, 26 GHz, has remained a niche: it has been awarded in only seven European countries. The only new European 26 GHz award was run in Spain; valuation was as low as in earlier auctions which suggests that no serious business case for the band has been found yet.

After these awards the 700 MHz and 3600 MHz bands have become almost fully completed in European markets. The most notable exceptions are Poland, where both bands remain unawarded, and the Netherlands, where award of the 3600 MHz band has been delayed. Both countries are expected to proceed during 2023.

Examples of 5G awards outside Europe in 2022 include Kazakhstan, India, Bangladesh, South Korea, and Malaysia (a special arrangement with a state-owned wholesale operator) as well as Nigeria and South Africa.

Focus on optimisation of production setup

After a series of 5G frequency awards since 2015, operators’ frequency portfolios seem now rather secured. Naturally, there will be renewals of legacy bands, but they are not expected to change the market setting in any material way. In consequence, most operators can shift their focus from acquiring spectrum to optimal usage of spectrum.

Typically, operators’ frequency holdings include 700 MHz, 800 MHz, 900 MHz, 1800 MHz, 2100 MHz, 2600 MHz, and 3600 MHz. A lot of frequencies with different characteristics. Further, some of the bands are occupied by legacy technologies, such as 2G or 3G, with sub-optimal productive efficiency. Given its higher spectral efficiency, deployment of 5G technology is a key option in any of the bands. However, an early full switch might not be viable due to several reasons; for example, operators must continue to support legacy end user terminals, licence terms may not be fully technology neutral and full replacement of productive assets would likely lead to excessive upfront investments. Gradual network development via capacity investments and replacement investments is likely to provide better flexibility and higher returns. With several frequencies and technologies to choose from, investment planning must be tailored to the context, there is no one-size-fits-all solution.

5G pioneer bands‍

• The 700 MHz band is a low frequency band. It provides best possible coverage with minimum investments but suffers from lack of capacity. Typical holdings are not more than 2 x 10 MHz per operator.
• The 3.6 GHz band (also known as C-band) provides a combination of coverage and capacity and is often used as a key capacity layer in mobile networks. Works nicely also in FWA deployments. However, most often not viable in sparsely populated areas due to challenges in coverage. Typical holdings are around 100 MHz per operator and part of the band is often allocated for local/vertical use.
• The 26 GHz band is most appropriate in provision of high-speed data services in hotspot areas. Typical holdings can be as large as 800 MHz per operator, more than all the other bands combined. Currently, however, the band is often seen merely as an option for potential further use. Part of the band is typically allocated for local/vertical use.

How can Omnitele support you?

Omnitele has assisted its customers through the modelling and simulation of different RAN (Radio Access Network) strategy scenarios with varying input parameters, including:

• Different spectrum band combinations: legacy spectrum holdings complemented by newly acquired 5G bands and/or potential new spectrum to be acquired
• QoS/Throughput objectives
• Traffic model with varying traffic growth factors
• Technology development, technology choices & costs thereof
• Regulatory obligations and constraints You can read more about how we could help you from our customer case.

‍