TORONTO – Industry Canada will stage another wireless spectrum auction early next year, with more than half of that spectrum set aside for operating new entrants, in an effort to increase wireless competition.
At a press conference early Monday morning in Toronto, Industry Minister James Moore said that the AWS-3 auction will take place before the 2500 MHz auction, which is scheduled for April 14, 2015. The AWS-3 spectrum band also includes 50 MHz of paired spectrum and is is adjacent to the AWS spectrum auctioned in 2008. It is thought to be more valuable than the 2,500 MHz variety because it functions well in both urban and rural areas and its signals penetrate buildings better.
The Government will set aside one 30 MHz block of AWS-3 spectrum for operating new entrants, described as wireless carriers with less than 10% national and 20% provincial/territorial wireless subscriber market share, in each region of the country. In addition, these companies must be actually offering wireless service in the areas they wish to bid on in the auction, meaning that companies such as Wind Mobile, Mobilicity, and regional carriers such as Videotron (outside of Quebec) will be able to bid on the set aside spectrum where they already have committed to provide service.
Industry Canada described AWS-3 spectrum as ideal for delivering fast, reliable service to Canadians on the latest smartphones, tablets and mobile devices, and well-suited for mobile services using Long-Term Evolution (LTE) technology. It also said that the spectrum’s proximity to the AWS band “will facilitate expedited network deployment and availability of consumer handsets”.
"Our government will continue to make decisions that will lead to more choice, lower prices and better service for Canadian consumers”, said Minister Moore in a statement. “Today's announcement will help operating new entrants acquire valuable new spectrum to help expand their networks and deliver fast, reliable service to Canadians. The rules for this auction, consistent with the ones for the 700 MHz and 2500 MHz auctions, will encourage more competition in the wireless market while ensuring the interests of consumers first."
In addition to the set aside, the AWS-3 spectrum auction rules will include “strict provisions” on the transfer of spectrum, and a simpler, shorter auction process that will allow wireless providers to have the results of AWS-3 auction before the 2500 MHz auction.
Consultations on the licensing of this spectrum will begin this summer, and will ask for feedback on details like whether licences for AWS-3 should include deployment requirements in both the short term (for example, five years after the licences are issued) and the long term (ten years after); and whether a simplified and accelerated auction process, using a sealed-bid format, would be the best approach to encourage participation.
Wind Mobile was quick to applaud the announcement, calling it a “realistic and bold initiative (that) shows that the Government is firmly committed to giving Canadian consumers what they want and deserve, and understands what is required to achieve it”. (Ed note: not to mention that it also delivers exactly what Wind chairman and CEO Anthony Lacavera said he wanted during his interview with Cartt.ca editor and publisher Greg O’Brien during last month’s Canadian Telecom Summit.)
“Today’s announcement is proof that the Federal Government is taking significant and important steps in encouraging more competition, more choice and more value in the Canadian wireless industry, and I applaud Minister James Moore for his positive efforts,” said Lacavera, in the announcement. “Canadians are paying too much for wireless services that lag behind the rest of the world – and only increased competition will improve that. Competitive alternatives like Wind Mobile need additional spectrum to grow and flourish. Decisions like the one announced today recognize that the Canadian wireless industry is maturing and demonstrate that the Government is determined to see that the demands of Canadian consumers are addressed.”
Consumer groups Public Interest Advocacy Centre (PIAC) and Consumers’ Association of Canada (CAC) also praised the announcement, calling the spectrum set aside for new entrant wireless companies “good news for consumers.”
"Canadians are waiting for a fourth national wireless company," said CAC president Bruce Cran, in a statement. “Prices won’t fall and wireless competition will not really work until Canadians have another choice.”
It remains to be seen if the announcement will help spur Quebecor CEO Pierre Dion to move forward with plans to make Videotron Canada’s fourth national player, as he announced during the Canadian Telecom Summit. At that time, he said that if the Government overhauls its domestic roaming policy, it would consider “consolidation with one or two of the undercapitalized new wireless entrants” such as Wind and ailing Mobilicity, a move that he said would triple Videotron’s current wireless customer base.
