The limits of spectrum benchmarking
The responses of the Australian operators to ACMA’s consultation on expiring spectrum licences make for interesting reading.
The country has a total of 69 spectrum licences due to expire between 2028 and 2032, so the consultation is a major piece of regulatory work.
ACMA has decided to renew the vast majority of licences, but at a price. The regulator will calculate what fee the country’s three mobile network operators (MNOs) must pay for licence renewal.
The consultation, which was published earlier in 2025, gave a total, nominal price range for expiring spectrum licences for 4G/5G and FWA of A$5.0–6.2 billion. This is a non-inflation-adjusted figure and is a total for all the country’s MNOs.
The previous total, nominal price for the licences was $8.2 billion, the regulator said. The new lower figure reflects how spectrum values have fallen internationally and is a result of benchmarking against past auctions in the mobile industry going back as far as 2010 in a number of countries, including the US, Canada, many European countries, Asia (South Korea, Singapore and Hong Kong) and Latin America (Uruguay).
The consultation generated over twenty responses. So far, I’ve concentrated on those from two of the three MNOs: Telstra and Optus. After all, the MNOs are the ones with the most skin in the game.
Unsurprisingly, they both believe ACMA has overstated total renewal fees.
Telstra reckons ACMA’s pricing model overstates today’s full market price for spectrum “by at least 30 per cent” and the downward trend will continue by a further 50 per cent by 2028-32.
Applying these reductions would reduce total industry renewal fees to A$1.75-2.17 billion. In its submission, Optus argued for a similar figure of A$2-2.4 billion.
There are echoes of a similar debate in the UK earlier in 2025 when mobile operators disagreed with the regulator Ofcom over annual licence fees.
Reading the ACMA consultation as well as the Telstra and Optus submissions got me thinking about how difficult it is to establish a fair value for spectrum. And how we rely an awful lot on benchmarking of past auctions, about which there can be so much disagreement. In contrast, auctions provide so much clarity.
But what if auctions become less common as more regulators follow the ACMA approach and rely on benchmarking to establish a price for licence renewal? Or, as some MNOs want, licences are renewed automatically?
With no new auctions, the price of spectrum will be determined by the same past contests with no refresh. If that becomes the case, I have a (tongue-in-cheek) suggestion: stage an auction to sample demand, so that other regulators have a figure to benchmark against.
Here’s what PolicyTracker covered this week:
The UK government has announced a new plan to assess and potentially release spectrum for public use. London is also currently consulting on strategic priorities for spectrum management
SpaceX and mobile network operator One New Zealand have agreed to expand the capability of their satellite direct-to-device service in a deal that could serve as a template for other operators
SpaceX and mobile network operator T-Mobile have launched their satellite direct-to-device service, T-Satellite, in the US and Puerto Rico
Moroccan telecoms regulator ANRT has assigned 5G spectrum in the 700 MHz and the 3.4-3.8 GHz bands for $210 million
The new head of the US National Telecommunications and Information Administration will oversee controversial changes to the Broadband Equity Access and Deployment programme that have sharply divided the fibre and satellite sectors