What's with the Telstra (ASX:TLS) share price and other telcos today?

The share price of Telstra and other ASX-listed telcos are on the move today following the results of the latest 5G band spectrum auction.

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Shares in ASX-listed telco companies barely moved today following the outcome of the 26 GHz band spectrum auction.

The share prices of Telstra Corporation Ltd (ASX: TLS), TPG Telecom Ltd (ASX: TPG), and Pentanet Ltd (ASX:5GG) have all remained fairly flat as the end of trading closes in.  

Telstra pays a hefty price for its share

The Australian Communications and Media Authority announced the results of its 26 GHz auction on Friday. Australian telcos placed their bids over the last month in an attempt to secure licenses of the 5G optimised spectrum.

With the spectrum split into 360 available lots, 358 were sold for a combined total of $647.6 million. These 358 lots were snagged by just 5 competing bidders, listed below:

  • Pentanet Ltd won 4 lots – paying $7.986 million
  • Dense Air Australia won 2 lots – paying $28.690 million
  • Mobile JV (TPG's bidding vehicle) won 86 lots – paying $108.187 million
  • Optus Mobile won 116 lots – paying $226.203 million
  • Telstra won 150 lots – paying $276.576 million

The millimetre wave, or mmWave, spectrum band sold is a short-range, high-frequency, and high-capacity band that unlocks the massive potential of 5G. Clearly, Telstra wants to be the frontrunner of 5G's future in Australia, with the company making up nearly 43% of the total money spent by winning bids.

Telstra commentary

Commenting on the auction results, Telstra CEO Andy Penn said:

High-speed connectivity is critical to Australia's future prosperity and our aspirations to be a world-leading digital economy.

It has become central to all of our lives – the way we live, work, keep ourselves entertained and stay connected, and more and more 5G will be at the heart of that.

In its update, Telstra also revealed it's on track to reach 75% of Australia's population with its 5G network by the end of June. At the time of writing, the Telstra share price is 0.2% higher trading at $3.40 per share.

What about competitors?

Singtel-owned Optus purchased 800MHz in mainland capital cities, along with 600MHz in Hobart and the Margaret River region of Western Australia.

Furthermore, TPG snatched up the 600MHz spectrum licenses across Brisbane, Adelaide, Canberra, and regional areas. In addition to licenses for the 400MHz spectrum across Sydney, Melbourne, and Perth.

There have been competition concerns among players due to the 5G allocations. Optus has nudged the Australian Competition and Consumer Commission for a 70MHz cap on all low-band allocations.

Motley Fool contributor Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Telstra Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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