Minister for Communications, Cyber Safety and the Arts Paul Fletcher announced on Thursday he has directed the Australian Communications and Media Authority (ACMA) to set limits on the upcoming millimetre wave auction due in March.
"I have directed the Australian Communications and Media Authority to set allocation limits of 1GHz," Fletcher said.
"Success in the mobile market ultimately depends on access to spectrum. Applying allocation limits means that the 26GHz spectrum cannot be monopolised by any one operator."
The 26GHz band, from 25.1GHz to 27.5GHz, is set to be allocated by the ACMA in 29 areas across the country, while the 28GHz band, from 27.5GHz to 30GHz, will be restricted to apparatus licences. The former band will be allocated via an auction and administrative process, while the latter band will only be allocated by an administrative process.
"The 26GHz band is the first high-band spectrum earmarked internationally for 5G deployment to be allocated in Australia," the ACCC said in February when releasing a consultation paper.
"The propagation characteristics and large bandwidths of high-band spectrum, such as 26GHz and 28GHz, favour densely concentrated, small cell deployment models that support high-capacity broadband services. However, some network operators may adopt less dense deployment models with larger coverage areas per cell, especially for fixed broadband networks."
Fletcher said the government has plans to introduce legislation into Parliament that will "modernise the spectrum management framework" and be more flexible.
In April, NBN said it had tested using millimetre wave spectrum with propagation distances of over 10 kilometres.
"Our studies, and those of our technology partners provide high levels of confidence that the long-range use would allow NBN to have significant flexibility to maximise our deployment and upgrade options," NBN said.
"This long-range approach is enabled by our unique network topology with 100% external CPEs (consumer premises equipment), and largely line of sight deployment in regional and rural areas"
The current NBN fixed wireless network uses 4G LTE and has a propagation limit of 14 kilometres.
Telstra previously said it should get at least 1GHz of contiguous spectrum, equal to 42% of the spectrum available in the 26GHz band.
"A low (sub 1GHz) allocation limit which restricts operator optionality during the auction could therefore constrain or disincentivise future 5G deployment, investment and development," Australia's incumbent telco said. "A higher (at least 1GHz) limit reduces this risk."
"At the same time, in the longer term, other mmWave bands may become available, expanding the range of potential 5G deployment options open to operators."
Should the ACCC accept Telstra's arguments, clearly, one of Australia's three mobile network operators would be left with the rough end of the spectrum pineapple, potentially holding only 16% of the spectrum on offer.
Conversely, and much more mathematically equal, Optus put forward the idea of setting the allocation limit at 800MHz instead.
"An allocation limit of 800 MHz will allow networks to deliver peak speeds greater than 20Gbps, consistent with ITU 5G specifications; while ensuring the market would see at least three mmWave networks," the Singaporean-owned telco said.
"Importantly, it would ensure that no single operator can be dominant in the deployment and establishment of 5G services in this band."