CCSA, Distributel, Novus want application process reopened to allow more telecoms to participate in auction
TORONTO — Independent telecom service providers Distributel Communications, Novus Entertainment and the Canadian Communication Systems Alliance (CCSA), which has over 100 member companies, have written to Innovation, Science and Industry Minister François-Philippe Champagne in support of a request last week by the Competitive Network Operators of Canada (CNOC) for a 90-day delay to the start of the 3500 MHz spectrum auction currently scheduled to begin June 15.
In a letter today shared by Distributel CEO Matt Stein (who also chairs CNOC), the independent telecom company reiterates CNOC’s position that because the CRTC’s new regulatory framework for wholesale mobile virtual network operator (MVNO) services — which requires telecom providers to possess spectrum licences to access mandated wholesale MVNO services — was released after the deadline to participate in the spectrum auction, this “will have significant negative consequences on new entry and competition in Canada’s wireless market,” reads Distributel’s letter.
The CRTC released its new wireless policies on April 15th, 11 days after applications to take part in the auction were due to ISED.
In addition to asking for the 3500 MHz spectrum auction to be delayed, Distributel asks for the application process to be reopened to allow it and any other telecom service providers now interested since the CRTC changed its policies, to apply to participate in the auction, and to permit those who have already applied to revise their applications and deposit amounts if they wish to do so.
“A brief delay of the auction to allow parties to submit or revise their applications and deposits in light of Telecom Policy 2021-130 will therefore maximize participation in the auction and, in turn, serve to further the Department of Innovation, Science and Industry’s policy objective of supporting ‘sustained competition, so that consumers and business benefit from greater choice’,” reads Distributel’s letter.
In a letter dated April 23 and shared today with Cartt.ca, Novus Entertainment co-president and chief legal officer Donna Robertson writes: “Like CNOC, Novus believes that the combined effect of the Wireless Decision (April 15, Canadian Radio-television and Telecommunications Commission Decision Review of mobile wireless services, Telecom Regulatory Policy CRTC 2021-130) coming after the deadline for participation in the 3500 MHz auction has effectively shut the door to new competition in Canada for wireless services.”
She adds the situation is “even more troublesome” given the impending purchase of Shaw by Rogers and further consolidation of the communications industry in Canada.
“Novus, as a facilities-based new entrant in the communications industry has observed firsthand the positive effects of robust competition in an industry long ruled by former incumbent monopolies. We believe that our presence in the Metro Vancouver marketplace has done much to foster competition that has greatly benefited consumers,” writes Robertson.
“Novus believes that ISED should work with the independent communications service providers and delay the 3500 MHz spectrum auction as requested by CNOC. It would be a far more competitive and meaningful process if more parties were given an opportunity to participate,” concludes Novus’s letter.
In CCSA’s letter dated April 26, the organization’s vice-president of regulatory affairs, Chris Edwards, points out that very few of CCSA’s members — independent telecom service providers who operate broadband networks to provide services — have been able to offer mobile telecom services to their communities.
“That is because, to date, most have been unable either to purchase necessary spectrum or to gain wholesale access to the large incumbent carriers’ Radio Access Networks,” writes Edwards.
“[W]e submit that such an extension is a matter of basic fairness to potential competitive entrants who could not have been aware of the CRTC’s new rule at the time the auction registration deadline closed,” says the CCSA letter.
CCSA’s Edwards notes Novus Entertainment and several of CNOC’s members are also members of CCSA.
“CCSA believes that other companies among its membership also have an interest in providing competitive mobile services in their areas and, therefore, an interest in participating in the 3500 MHz spectrum auction to obtain the spectrum they now know they need to do that,” says CCSA’s letter.
As it stands now, the 3500 MHz spectrum auction is scheduled to begin June 15 and the list of qualified bidders was released on April 7.
Cartt.ca has contacted the Minister’s office for comment and we’ll let you know the response when we receive one. The auction has already been delayed six months as it was to happen in December 2020.
UPDATE April 28: This was the emailed reponse from the Ministry, and it gives no answers to our question whether or not it is considering a delay: “The 3500 MHz auction is currently scheduled to begin on June 15, 2021. The Government of Canada is reviewing the recent CRTC decision and remains committed to taking action to support a competitive marketplace with greater choice and affordable options for Canadians.”
We would ask the major carriers what they think of a possible auction delay but we feel pretty certain they would hate that idea. Plus, the first rule of spectrum auction is you don’t talk about spectrum auction. Any comment on the auction could get a prospective company banned from bidding.
