The war for 5G frequencies in the 3.6 GHz range in Bulgaria was short. Perhaps expectations for the way the intrigue will unfold were set too high after heated remarks between operators before the auction. On the plus side, now that it's over, the companies can finally focus on offering 5G services, and each telecom has a different strategy and deadline.
The auction for 5G frequencies was held at the beginning of April by the Communications Regulation Commission (CRC) and resulted in awarding licenses for 100 MHz bands in the 3.6 GHz range to all three local telecoms. A1 Bulgaria, part of A1 Telekom Austria Group, won the bidding and the right to choose a bandwidth by offering 4.7 million levs (2.35 million euro). It chose the mid-band of 3600-3700 MHz, considered the most desirable one. The second-highest bid came from Bulgarian Telecommunications Company (BTC) operating under the Vivacom brand. The telecom offered 4.6 million levs and chose the highest bandwidth of 3700-3800 MHz. Thus, the low band in the 3500-3600 MHz range was left for Telenor Bulgaria which was the first to drop out of the bidding at 4.1 million levs. In the end, the state won 13.4 million levs. In addition, each of the telecoms will pay a total of 8 million levs in annual fees in the next 20 years.
The new normal
The distribution of the frequencies marks the official commercial launch of 5G services on the Bulgarian market, and each telecom has a plan of its own. In the fall of last year, BTC announced it was launching its commercial 5G network, albeit by using frequencies also in use for its 4G network, and with a number of limitations in geographical coverage and capacity. A few months later, A1 Bulgaria did the same, emphasizing in their campaign that they were the first to offer real 5G services and speed, and began to cover the big cities. On April 23, Telenor announced its plans to launch commercial 5G services on June 10. CEO of Telenor Jason King told Capital Weekly in an interview that the company will begin by covering "the big cities and the seaside resorts", and will continue to expand its coverage by adding cities as time goes on. "Our goal is to be able to say that we are the leader in coverage and quality of offered 5G network services by mid-2022," said King.
The winner
"The procedure for allocating the radio frequency resource in the 3.6 GHz range took some time and went through various phases, including attempts at administrative delays by our competitors, who were afraid of our technological and market advantage," the CEO of A1 Bulgaria, Alexander Dimitrov, told Capital. According to him, the A1's 5G network is the only one operating on 5G frequencies and with 5G equipment, and is covering over 75 cities and resorts in the country.
"In practice, we are ready for a commercial launch," added the manager, according to whom the investments in the 5G network will be close to 40 million levs for 2020 and 2021 combined. In the next four years, the company intends to invest 780 million levs in its mobile network. Dimitrov also said that the first commercial 5G services will be offered to both private and business customers.
BTC and Telenor
BTC stated that they were satisfied with the results of the bidding. "The investments we make in the development of the fifth-generation network will enable our customers to use services of the highest quality and at the same time will support the process of digitalization of society and the growth of the Bulgarian economy," BTC CEO Atanas Dobrev said in a statement after the competition. According to the telecom, its 5G mobile services are already available in the downtown areas of Bulgaria's 27 regional centres.
Telenor Bulgaria also congratulated CRC for the "professionally conducted auction".
"Telenor Bulgaria believes that there is no significant difference between the frequency bands and that they are equally suitable for building a high-quality 5G network. We will continue to offer our customers a first-class network and quality user experience in the coming years," the operator said in a statement.
It remains to be seen whether there would be a sharing of 5G resources between the local telecoms - something that can be expected given the significant investments in infrastructure and equipment necessary. According to unofficial estimates, the three operators might invest a total of 1 billion levs (500 million euro) in such assets in the coming years. One of the benefits of the 3600-3700 MHz range is that it can be shared with either of the other two operators more easily than the other bands. The first signs of negotiations between BTC and Telenor already emerged but all kinds of combinations are possible, including all three working in the same bandwidth.
In the coming years, other high-end frequencies like the 26 GHz band will also have to be auctioned. However, a more significant issue for the three telecoms is likely the case of the lower-end frequencies between 700 and 800 MHz which guarantee national coverage. For years, they have been and still are occupied by the military who are using them for communication between the Russian-made MiG aircraft of Bulgarian Air Force. Expectations currently are that the issue will be addressed next year.
The war for 5G frequencies in the 3.6 GHz range in Bulgaria was short. Perhaps expectations for the way the intrigue will unfold were set too high after heated remarks between operators before the auction. On the plus side, now that it's over, the companies can finally focus on offering 5G services, and each telecom has a different strategy and deadline.
The auction for 5G frequencies was held at the beginning of April by the Communications Regulation Commission (CRC) and resulted in awarding licenses for 100 MHz bands in the 3.6 GHz range to all three local telecoms. A1 Bulgaria, part of A1 Telekom Austria Group, won the bidding and the right to choose a bandwidth by offering 4.7 million levs (2.35 million euro). It chose the mid-band of 3600-3700 MHz, considered the most desirable one. The second-highest bid came from Bulgarian Telecommunications Company (BTC) operating under the Vivacom brand. The telecom offered 4.6 million levs and chose the highest bandwidth of 3700-3800 MHz. Thus, the low band in the 3500-3600 MHz range was left for Telenor Bulgaria which was the first to drop out of the bidding at 4.1 million levs. In the end, the state won 13.4 million levs. In addition, each of the telecoms will pay a total of 8 million levs in annual fees in the next 20 years.
