In May 2026, after more than a year of consultations and competing economic analyses, Australia's Communications and Media Authority settled on a number: A$7.32 billion. That is the combined price it will charge Telstra, Optus, TPG Telecom, and NBN Co to renew mobile spectrum licences expiring between 2028 and 2032 — licences that currently underpin more than 30 million mobile services across the country. The first application window opened on 18 June 2026, covering the 850MHz and 1800MHz bands, with the full suite of bands (700MHz, 2GHz, 2.3GHz, 2.5GHz, and 3.4GHz) to follow. Successful applicants will hold their licences until 2044.
The question hanging over the exercise is whether the price attached to that certainty reflects what the market would actually bear — or whether it is a government revenue target dressed up as an independent valuation.
The Case for Charging Market Rate
The regulator's position is defensible in principle. Spectrum is a finite, publicly owned resource, and ACMA Chair Nerida O'Loughlin has stated plainly that "$7.32 billion represents the market rate" following a "rigorous benchmarking process." The regulator commissioned independent consultants DotEcon and Ian Martin Advisory to validate its methodology, and it has publicly noted that even at A$7.32 billion, the renewal bill remains below the approximately A$8.2 billion carriers paid in competitive auctions during the 2010s. Under this framing, a renewal at below-auction prices is already a concession to incumbents — the industry's objection amounts to asking for an even larger one. ACMA also argues its own analysis shows telcos can absorb the cost without raising retail prices, and Australia's consumer advocacy group ACCAN welcomed the higher pricing as protecting the public asset's value.
Those are real arguments. But the case against the methodology that produced the A$7.32 billion figure is not thin.
A Methodology Under Serious Scrutiny
Independent consultants Aetha Consulting and NERA, retained to review ACMA's benchmarking approach, identified four material shortcomings. First, the model fails to account for well-documented global declines in spectrum prices over the past decade. Second, the benchmark dataset contained missing auctions and material errors. Third, the analysis does not adequately account for asymmetric risk when renewal prices are set above fair market value. Fourth, forward-looking inflation assumptions were applied despite persistent long-run spectrum price deflation in comparable markets.
The combined effect, Aetha and NERA concluded, is a pricing outcome that "carries a substantial risk of being above actual fair market value, most notably in the Sub-1GHz and Lower 1-3GHz band groups" — precisely the bands that form the backbone of 4G coverage and rural 5G service in Australia. These are not industry-funded critiques designed to shave a few percentage points off the bill. Aetha is a specialist spectrum consultancy that works across multiple jurisdictions and regularly advises regulators as well as carriers. That ACMA moved only A$20 million — from A$7.34 billion to A$7.32 billion — in response to the consultation process suggests the independent findings did not substantially alter the regulator's view.
What the Numbers Show
The carriers' specific positions add granularity. Telstra argued in its pre-budget submission to Treasury that ACMA's pricing is "dramatically above global norms," putting its own fair-market share at approximately A$1.2 billion against ACMA's allocation of around A$2.8 billion — a A$1.6 billion gap that, Telstra noted, could fund its entire Aura inter-city fibre network or double its A$800 million network improvement program. The industry as a whole proposed a cap of approximately A$3.9 billion, less than half the final figure.
TPG Telecom went further, commissioning independent modelling that suggested ACMA's prices were up to four times too high in certain spectrum categories. The Australian Telecommunications Alliance warned the final pricing would "make it harder for carriers to deliver fast reliable mobile broadband services at affordable prices." Telstra has also cited research suggesting a 10 percent increase in spectrum costs correlates with roughly 8 percent slower download speeds and 6 percent reduced 5G coverage — a directional relationship that, if it holds, has real consequences for the 30 million services depending on this spectrum.
Optus raised a related concern: higher renewal costs put at risk its "capability to continue investing in network upgrades and the regional infrastructure and services Australians deserve and expect" — a pointed reference to the politically sensitive question of rural connectivity.
The International Benchmark Gap
The international context is the most awkward element of ACMA's position. According to Telstra's analysis, the UK regulator Ofcom set 2025 low-band spectrum prices at approximately half those proposed by ACMA, with mid-band prices 30 to 40 percent lower. Australia has legitimate infrastructure cost differences from the UK — it is a vast country with challenging terrain and a dispersed population — but a 60 percent premium in low-band pricing requires a proportionate explanation. ACMA has not publicly engaged with those specific comparisons in detail.
What Happens Next
Carriers have limited formal recourse. Telstra has flagged that the pricing approach is "not immune from legal challenge" in the Federal Court as "legally unreasonable," but judicial review on administrative grounds is difficult to win and expensive to pursue. The more likely outcome is that carriers proceed with applications and manage the cost through capital reallocation — with practical consequences flowing through to network investment timelines rather than quarterly reports.
For policymakers and observers, the A$7.32 billion decision raises a structural question that goes beyond this particular renewal cycle. When a public regulator sets prices for a captive industry — where carriers have no alternative but to pay or exit the market — it carries a higher burden of methodological rigour than a competitive auction. The existence of independent technical critique identifying systematic errors in the benchmark dataset and analytical assumptions is not something that should be resolved with a A$20 million token adjustment.
Proportionate spectrum pricing does not mean free spectrum. It means pricing grounded in what comparable spectrum would actually fetch, using a methodology that accounts for market trends, dataset quality, and downside risk when valuations are contested. Whether ACMA's process met that standard is now the central question — and the carriers' next move, legal or otherwise, will determine whether it gets answered.