MIC to revise spectrum allocation process to open up 5G market

28 Nov 2017

The Nikkei Asian Review reports that the Ministry of Internal Affairs and Communications (MIC) in Japan will revise its spectrum allocation process in a bid to encourage new players to enter the country’s 5G market in the coming years. With the big three cellcos – NTT DOCOMO, SoftBank and KDDI gearing up to launch nationwide fifth generation service by the 2020 Tokyo Olympics, the government is keen to introduce competition from new players in the hope that it will drive down charges in Japan, where mobile call plans currently cost more than in many other countries.

The Ministry is understood to be sitting on a new report compiled by a government panel on regulatory reform, that is eyeing new ways of bidding for spectrum to increase transparency regarding how it is awarded and adopt what will likely look close to competitive bidding. In the past, the bid process has drawn criticism for what some say has been a ‘behind closed doors’ selection method in which the powerful ministry has been left free to ‘exercise broad discretion’ on the outcome of any tender. The Nikkei notes that out of the 35 countries in the Organization for Economic Cooperation and Development (OECD), only Japan does not auction off bandwidth via competitive price bidding. ‘The ministry will introduce some features of these spectrum auctions under a new framework,’ it says. Spectrum may go to even non-telecom companies with advanced technological capabilities and strong finances. Many businesses are expected to seek entry into 5G service, which will likely be used for IoT, virtual reality and automated driving in addition to smartphones.

The details of the new tender are expected to be finalised in the coming year (i.e. fiscal year starting April 2018) and the MIC aims to submit a proposal to amend relevant legislation in 2019.