The top two mobile operators in South Korea are engaged in a battle to secure additional LTE spectrum, a week after an auction was launched by the Korea Communications Commission (KCC) – with the final price tag expected to reach KRW1 trillion (US$919.5 million).
SK Telecom and KT Corp are vying to secure the spectrum so they can expand their LTE services, reports Reuters. SK Telecom launched LTE services in Seoul in July with KT planning to do the same in November.
The auction has been running for more than a week with the initial bid price for the 1.8Ghz spectrum starting at KRW445.5 billion. In addition to the 1.8Ghz spectrum, the country’s 2.1Ghz band has already been licenced to LG Uplus for KRW445.5 billion while the 800Mhz band is yet to receive a bid.
According to Reuters, South Korea has seen a surge in mobile data traffic as smartphone penetration has risen from 2 percent two years ago to hit 42 percent. However, mobile operators haven’t seen this increase in smartphone use translate into significant sales growth.
The high spectrum prices could put pressure on operator earnings as they also contend with mobile tariff cuts –as the government strives to control inflation – and network investment.
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