BLOG

Reality Bites in the Spectrum Auctions

20.01.2020
Share this

In June last year, the latest round of US spectrum auctions raised $2.7 billion, with AT&T and T-Mobile between them spending $1 billion. This contrasted with figures of up to $45 billion that were spent on spectrum for 3G and 4G. There are more auctions to come, and a view that many companies are holding onto ‘dry powder’ to bid for subsequent bands. It’s also true that 5G infrastructure will be more expensive to build out. But it seems clear that underlying the fall is a determination to avoid the mistakes of the past, when companies allocated capital based on highly optimistic growth and revenue forecasts. Now there is a widespread expectation that 5G will command a small premium, if any, and to make a success of it companies cannot to afford to be saddled with high levels of debt.

In many IIC events over the last year, concerns have been expressed about the viability of 5G business models alongside pleas for governments not to make excessive demands. Regulators have heard this, and where once the objective was to maximise revenue, the balance appears to have moved in favour of ensuring the efficient allocation necessary to benefit the maximum number of consumers.

5G still has its sceptics. But spectrum that once cost dollars and pounds per citizen is now selling for cents and pennies as companies weigh the demands of their shareholders as well as their customers. More auctions are due this year, including in Europe and the US, and in Australia next year. More of the current pricing devaluation should be seen as an encouraging sign.

Scars from 3G should help to ensure that 5G will be a success

Theme:
Infrastructure and Spectrum, Governance
Region:
Asia Pacific, Americas, Europe
Andrea Millwood Hargrave Andrea Millwood Hargrave Director General, International Institute of Communications
You may also like... Blog
petri dishes
Coronavirus reminds us of the seriousness of fake news 18.02.2020
Blog
Will 2020 Be the Year Regulation Catches Up With Social Media? 16.01.2020
Blog
Data Aggregation and the Effectiveness of Antitrust, Merger Control and Regulatory Tools 16.01.2020

Latest

News
IMDA Singapore
Bids submitted for 5G licences in Singapore 21.02.2020
News
Mark Zuckerberg, Facebook
Zuckerberg’s stance on regulation 20.02.2020
Blog
petri dishes
Coronavirus reminds us of the seriousness of fake news 18.02.2020
News
FTC investigates 'big tech' acquisitions
FTC investigates ‘big tech’ acquisitions 17.02.2020
View All
Back to the top

The IIC is the world's only policy debating platform for the converged communications industry

We give innovators and regulators a forum in which to explore, debate and agree the best policies and regulatory frameworks for widest societal benefit.

Insight: Exchange: Influence

We give members a voice through conferences, symposiums and private meetings, as well as broad exposure of their differing viewpoints through articles, reports and interviews.

The new website will make it easier for you to gather fresh insights, exchange views with others and have a voice in the debate

Take a look Learn more about our updates
Please upgrade your browser

You are seeing this because you are using a browser that is not supported. The International Institute of Communications website is built using modern technology and standards. We recommend upgrading your browser with one of the following to properly view our website:

Windows Mac

Please note that this is not an exhaustive list of browsers. We also do not intend to recommend a particular manufacturer's browser over another's; only to suggest upgrading to a browser version that is compliant with current standards to give you the best and most secure browsing experience.