Shares of telecommunications companies listed on ASX barely budged today following the outcome of the 26 GHz spectrum auction.
The stock prices of Telstra Corporation Ltd (ASX: TLS), TPG Telecom Ltd (ASX: TPG), and Pentanet Ltd (ASX: 5GG) have all remained fairly stable as the end of trade nears.
Telstra pays a high price for its part
The Australian Communications and Media Authority announced the results of its 26 GHz auction Friday. Australian telecom operators presented their offers over the past month in an attempt to obtain licenses for spectrum optimized for 5G.
With the spectrum broken down into 360 available lots, 358 were sold for a combined total of $ 647.6 million. These 358 lots were won by only 5 competing bidders, listed below:
- Pentanet Ltd won 4 lots – paying $ 7.986 million
- Dense Air Australia won 2 prizes – paying $ 28.690 million
- Mobile JV (TPG’s auction vehicle) won 86 lots, paying $ 108.187 million
- Optus Mobile won 116 prizes – paying $ 226.203 million
- Telstra won 150 prizes – paying out $ 276.576 million
The millimeter wave spectrum band, or mmWave, sold is a short-range, high-frequency, high-capacity band that unlocks the enormous potential of 5G. Clearly, Telstra wants to be the pioneer of the future of 5G in Australia, with the company accounting for almost 43% of the total money spent to win deals.
Commenting on the auction results, Andy Penn, CEO of Telstra, said:
High-speed connectivity is essential to Australia’s future prosperity and our aspirations to become the world’s leading digital economy.
It has become central to all of our lives – the way we live, work, play and stay connected, and more and more 5G will be at the heart of it.
In its update, Telstra also revealed that it is on track to reach 75% of Australia’s population with its 5G network by the end of June. At the time of writing this article, the Telstra share price is 0.2% higher at $ 3.40 per share.
And the competitors?
Singtel property Optus bought 800 MHz in the capitals of the continent, as well as 600 MHz in Hobart and in the Margaret River region of Western Australia.
In addition, TPG has recovered the 600 MHz spectrum licenses in Brisbane, Adelaide, Canberra and regional regions. In addition to licenses for 400 MHz spectrum in Sydney, Melbourne and Perth.
There have been competition issues between players due to 5G allocations. Optus pushed the Australian Competition and Consumer Commission to a 70 MHz cap on all low band allocations.
Where to invest $ 1000 now
When investment expert Scott Phillips has stock advice, he can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter that he’s been running for over eight years has offered thousands of paying members stock picks that have doubled, tripled, or even more. *
Scott has just revealed what he believes to be the five best ASX stocks for investors to buy now. These stocks are trading at very low prices and Scott thinks they are a great buy right now.
* Returns from February 15, 2021
Motley Fool Contributor Mitchell lawler has no position in any of the listed securities. The Motley Fool Australia owns shares and recommended Telstra Limited. The Motley Fool has a disclosure policy. This article only contains general investment advice (under AFSL 400691). Authorized by Bruce Jackson.