Supreme court ruling paves way for Chile’s 5G tender

An anticipated ruling by Chile’s supreme court ratified the country's new national spectrum plan, paving the way for a 5G spectrum auction.

In a decision announced on Monday, the court ratified the mix of macrobands with dynamic limits proposed by regulator Subtel, in addition to clarifying spectrum usage rules.

Subtel’s proposal had consisted of a more flexible regime of dynamic spectrum caps, with a maximum amount per operator per band rather than a total amount of spectrum per operator.

Under the plan, Subtel proposes to establish a spectrum limit of 50MHz for low bands (under 1GHz), a 60MHz limit for medium-low bands (1-3GHz), an 80GHz limit for medium-high bands (3.4-3.8GHz) and a 200MHz cap for high bands (27.5-28.35GHz).

In the low bands, the court set a cap of 32% of spectrum per operator (Subtel had proposed 35%), 30% in the 1-3GHz bands, 30% in the 3-6GHz bands and 25% in the millimeter waves (higher than 24GHz)

Telecoms undersecretary Pamela Gidi hailed the decision, saying it “will lay the foundations for the 5G network tender, of which we will soon have news,” she said via Twitter on Tuesday.

“This ruling, by putting clear rules regarding the spectral capacity that companies may have, removes the last existing obstacle to carry out the next spectrum contest for the development of 5G networks.”

Subtel has said a mix of bands with dynamic spectrum caps implies that in future assignments there would be no obligation to review or validate spectrum limits each time a new frequency is awarded, expediting the process.

“With this, the digital ecosystem will provide greater certainties, both legal and economic, and agility to encourage future investments in the sector,” Gidi said.

CONTEXT

The case that reached the country’s highest court involved a challenge brought by the National Corporation of Consumers and Users of Chile (Conadecus) and Netline questioning spectrum rules. 

Conadecus and Netline had contested what they saw as excessive spectrum in the hands of large carriers, with negative effects for competition in the mobile market. This led Subtel to propose a new plan with dynamic spectrum.

Conadecus also accused the telcos of surpassing the 60MHz cap during the auction of the 700MHz band in 2014. Telcos were then ordered by the courts to return spectrum to bring them back down to the 60MHz limit.

But the carriers argued that 60MHz was an unrealistic limit and took the case to the higher courts.

"This ruling shows that our arguments on the dominant position of the three large operators were heard, and revealed the need for correction through the granting of mitigation measures," Ximena Rojas, Netline's legal manager, was quoted by paper La Tercera as saying.

“We’re satisfied with this ruling, since the path to provide better services for all Chileans can finally begin with the future development of the 5G network. That’s why the publication of the bidding rules for spectrum must now come so we can begin this process,” the paper quoted WOM’s CEO Christopher Laska as saying.

Chile plans to award 1,000MHz of spectrum in four bands: 700MHz, AWS, 3.5GHz and 28GHz.

The watchdog will offer 20MHz in 700MHz, 30MHz in AWS (1,700-2,1000MHz), 50MHz in 3.5GHz and 850MHz in the 28GHz bands.