Base Fee Set at 3.1 Trillion Won
Reduced to 2.9 Trillion Won with 20,000 Indoor 5G Stations
Incentivizing Investment Through Flexible Options
The government has decided to lower the reallocation fees for 3G and LTE mobile communication frequencies, which are set to expire next year, by approximately 15% compared to the previous standard. However, this reduction comes with conditions: operators will be required to transition to 5G standalone (SA) mode, and they will only fully benefit from the fee reduction if they establish a certain number of 5G indoor wireless stations.
On December 10, the Ministry of Science and ICT held a briefing at the Seoul Government Complex and announced the finalized detailed policy plan for the reallocation of 3G and LTE frequencies totaling 370 MHz. The reallocation fee set this time is about 3.1 trillion won, which is 14.8% lower than the approximately 3.6 trillion won that was presented as the base price during the previous reallocation. Additionally, an 'investment option' was introduced, which allows for a further phased reduction in the reallocation fee depending on whether 10,000 or 20,000 new 5G indoor wireless stations are established compared to December 1. If all three major telecom companies reach the target of 20,000 stations, the final reallocation fee could be reduced to about 2.9 trillion won.
Nam Youngjun, Director of Frequency Policy at the Ministry of Science and ICT, explained, "Since Korea became the first country in the world to commercialize 5G, the market has been gradually maturing, and we must also prepare for the commercialization of 6G." He added, "This reallocation plan reflects the direction of wireless network evolution, taking into account competition in AI and physical AI."
This reallocation also features different usage periods by frequency band. The 1.8 GHz 20 MHz band and the 2.6 GHz 100 MHz band, both considered candidate bands for 6G, will be reallocated for only three years until 2029, after which further reallocation or new auctions will be considered. The remaining 250 MHz will be given a five-year usage period to protect existing subscribers. Nam explained, "For the 2.6 GHz band, we considered broadband expansion through TDD (Time Division Duplex) conversion, and for the 1.8 GHz band, we took into account the possibility of utilizing adjacent unused bands."
The government also expanded some autonomy for telecom operators in how they use the frequencies. For the 3G band, operators can choose to maintain it as is or upgrade to LTE or higher. For the LTE bands at 2.1 GHz and 2.6 GHz, operators may shorten the usage period for one block each, provided it does not compromise user protection. Additionally, the government announced plans to preemptively revise relevant notifications so that frequencies currently reallocated for 3G and LTE can be converted to 5G or higher technologies, as long as user protection is not compromised.
Another pillar of this plan is the mandatory transition to 5G standalone (SA) mode. The Ministry of Science and ICT has specified in the allocation conditions that the domestic 5G network, which is currently mostly operating in NSA (non-standalone) mode, must transition to SA by the end of 2026. All 5G wireless stations built so far must be connected to 5G SA core equipment by the end of 2026, and all newly built 5G base stations must, in principle, be connected to SA.
Regarding concerns that the transition to SA could cause a temporary reduction in speeds, Nam stated, "Telecom operators will minimize perceived quality degradation by adjusting cell plans and other measures." He added, "Ultimately, speed is determined by the number of wireless stations and the width of the frequency band. Revising technical standards to allow the conversion of LTE bands to 5G is also intended for this purpose."
The government also clarified the penalties if telecom operators fail to meet the SA transition requirement by the end of 2026. Nam said, "If the allocation conditions are violated, a corrective order can be issued, and administrative action can be taken if necessary. From 2027, we will begin compliance inspections and take follow-up measures based on the results." Regarding the timing of the termination of 3G services, he said, "This is a matter handled by another department, separate from the reallocation, so it's difficult to specify a detailed schedule," but noted, "Some operators have been continuously expressing their intention to terminate 3G services."
On the topic of additional 5G frequency supply, the Ministry of Science and ICT stated, "We agree on the necessity from the perspectives of improving 5G quality, preparing for the AI era, and promoting competition, but at present, operator demand is uncertain. We will present specific supply plans once demand becomes clear."
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