Albania's authority for electronic and postal communications, AKEP, said it has opened a tender for the use of radio frequencies in the 3400-3800 MHz band, necessary to deploy the fifth-generation telecommunications network (5G).

AKEP is offering five individual authorizations for these frequencies, valid for 15 years and up for extension, it said in a tender notice last week. 5G provides faster speeds, lower latency, and greater capacity than its predecessors. The bidding will take place in five rounds, and a bidder will be able to win a maximum of three usage rights which must be put to use within 6 months from the authorization. Offers can be submitted until September 17.

The 5G network isn’t yet available for cellular internet users in Albania. In March, AKEP said two local telecommunication companies had expressed interest to start providing 5G services for the first time in the country. If AKEP manages to successfully use the entire available frequency spectrum, the minimum amount that the state budget will benefit from this process is calculated at approximately Euro 12.7 million.

The sole evaluation criterion for determining the winning bids will be their price. The tender regulation provides that the bid price can be paid in two installments, namely the first installment of 50% within seven days of receiving the notification of the winner and the second installment of 50% within six months of the granting of the Individual Authorization.

The minimum price set in the competition is significantly higher, compared to neighboring countries. For example, in Kosovo, the rights to use a larger amount of spectrum (100 MHz versus 80 MHz in the case of Albania) were granted for a price of around Euro 2 million. In North Macedonia, a right of use in the same band, always for an amount of spectrum of 100 MHz, was given to us for Euro 3 million.

The higher price can be argued with the larger population compared to neighboring countries, although the last Census showed a significant contraction, to 2.4 million inhabitants.

According to the competition regulation, a single bidder cannot win more than three usage rights or 160 MHz of spectrum in total.

In theory, the process also creates space for new operators to enter the mobile market. However, taking into account the small size of the Albanian market and the large investments needed to set up networks, in practice the chances of new mobile network operators entering the market are estimated to be small.

The deadline for submitting offers will be October 17 of this year, the date when the submitted offers will be opened. The start time of using the frequencies will be no later than 6 months from the date of the device with Individual Authorization.

The conditions of the tender require a coverage of 55% of the population with 5G services by 2027 and 85% of the population by 2030. Regarding the terms of territory coverage, the tender regulation requires coverage with 5G services in the authorized band (part of the spectrum 3.4 GHz - 3.8 GHz), until the end of 2025 in the ports of Durrës, Vlorë, Shengjin, Sarandë, Porto Romano, the airports of Tirana, Kukës and Vlora, the industrial zone Tirana - Durrës and the Hospital Centers of Tirana.

Meanwhile, the deadline for the extension of 5G services in all cities of Albania will be 2028.