AWS-3 auction set for March 3, consultation starts on 600 MHz

Industry Canada on Thursday announced March 3 as the date for the beginning of the AWS-3 auction and proposed policy changes to make 600 MHz, AWS-4 and 3500 MHz spectrum available for mobile use in the near future. The government said in a press release it has launched consultations on the release of 600 MHz spectrum, is looking to allow mobile use on the 3500 MHz band currently used for fixed-wireless connections and is planning for the release of AWS-4 spectrum “so that a new competitor can offer more choice to Canadians, especially those in rural and remote areas.” At a Thursday press conference in Vancouver, Industry Minister James Moore emphasized the need for Industry Canada to encourage more wireless competition through the use of spectrum regulation. "While we put more spectrum in the marketplace than ever before, we have a coherent and consistent policy as a government to make sure that we reserve more capacity than ever before for more competition in the wireless space," he said. Yet Moore also said that the incumbent players — Rogers Communications Inc., Telus Corp. and BCE Inc. — have also accessed more spectrum in the years since 2006, and provide "world-class services" to Canadians. "They are doing great things in the Canadian marketplace," he said. "They're some of the best wireless companies that exist anywhere on the globe." Bidding in the AWS-3 auction currently underway in the United States has exceeded $44 billion US, yet Moore refused to speculate on how much money Industry Canada's AWS-3 auction would raise. "I don't think anybody in this country pegged the tail on the donkey of what was going to be the exact precise return on the 700 MHz spectrum auction," he said. "We will get a return, but the goal of these policies is not to get the highest possible return on an auction." The department's approach, Moore said, is to divide up the spectrum and use it to benefit the consumer in the long term. The government said in July it was planning to set aside 60 per cent of the available bandwidth in the AWS-3 auction for "operating new entrants," a policy Moore confirmed Thursday. Quebecor Inc. president Pierre Dion said he was pleased that the government is following through on the proposal. "Minister Moore's announcements definitely go in the right direction, and today is certainly a good day for Canadian consumers," he said. Industry Canada said in the release that, in 2006, 98 per cent of the mobile spectrum available for wireless service was owned by Canada’s largest carriers. By May 2015, it said, 25 per cent of the available mobile spectrum will have been sold in auctions in which new competitors were given an opportunity to bid. By that time, the amount of spectrum available for mobile use in Canada will have increased by 60 per cent since early 2014, the release said. Canaccord Genuity telecom analyst Dvai Ghose said in a research note issued Thursday that, despite government moves over the years designed to put spectrum in the hands of smaller wireless providers, 95 per cent "of Canadian wireless subscribers are still with the incumbents and spectrum set-asides have not guaranteed new entrant success. ... In our view, new entrant spectrum set-asides have generally led to underutilized or unutilized spectrum." The deadline for applications to participate in the AWS-3 auction will be Jan. 30, according to a new government document, and the list of those who applied to participate will be published within four days after that. The list of qualified bidders will be published on Feb. 13, and deadline for bids will be noon on March 3. The winners will be announced three days later, on March 6, and will have until March 20 to make final payments, Industry Canada said. The newly announced 600 MHz consultation involves spectrum that, like 700 MHz, is useful for wireless carriers because it penetrates buildings well and balances strength over long distances with speed, the department said. Much of the 600 MHz spectrum on offer has been repurposed from over-the-air television broadcasters, and Industry Canada said it plans to work with authorities in the United States on a “multi-year process” to free up additional spectrum while allowing existing TV operators to continue broadcasting. A 600 MHz auction is expected to happen in the U.S. in early 2016, the Federal Communications Commission (FCC) said in an October post on its website. Industry Canada also promised a “new licensing approach” for the 3500 MHz band, currently used for fixed-wireless services such as rural Internet connections but for which the department plans to open up for mobile services. Concerns had previously been expressed by Internet service providers such as Xplornet Communications Inc. about how such plans will affect Internet service in areas dependent on wireless connections. Xplornet's concerns have apparently been addressed, as its president Allison Lenehan contributed the following comment for Industry Canada's press release Thursday: “Xplornet is pleased that the minister has today affirmed his continued commitment to consumers by acknowledging that the 3500 MHz spectrum plays a fundamental role in connecting rural Canadians to all the advantages of the digital world. This decision ensures that the 3500 MHz spectrum continues to be available to provide fast and affordable Internet service to Canadians.” The AWS-4 decision will enable a new competitor to offer wireless service to Canadians in rural and remote areas, the department said in the release. According to a document posted on Industry Canada's website Thursday, existing licence holders of AWS-4 spectrum, Gamma Acquisition Canada ULC (a subsidiary of U.S. satellite services company Dish Network Corp) and TerreStar Solutions Inc., are being invited to apply for a new licence. The licence is will be issued April 1 if an application is received from them, it said. If not, it will initiate another consultation. Technical rules still need to be established, the document said. TerreStar president Andre Tremblay said in a news release shortly after Industry Canada's announcement that spectrum is the “fuel” that drives technological change, new wireless services, and lower prices for consumers. “By modifying existing policies to make this spectrum useable in Canada, the Harper government will contribute to lower prices and will allow companies to provide better services for consumers, regardless of whether they are in highly populated cities or more rural and underserved communities,” he said. Wind Mobile chairman Anthony Lacavera said in a Thursday press release he welcomes the spectrum initiatives from government. "The federal government's commitment to sustained competition from a fourth carrier in every region is entirely in the best interest of Canadians," he said. “True competition means better wireless packages and lower rates for consumers." Industry Canada also promised to streamline the process for getting new licences on the 24, 28, and 38 GHz bands and reiterated its “use it or lose it” policy for newly acquired wireless spectrum on all bands. The department also said on Thursday it was releasing 2100 MHz of new spectrum for backhaul connections between the infrastructure in carriers' networks. Another auction, for 2500 MHz spectrum, will take place in April, the government noted in its release. — With reporting by Peter Henderson at phenderson@thewirereport.ca and Anja Karadeglija at akarad@thewirereport.ca and editing by Derek Abma at dabma@thewirereport.ca

AWS-3 auction set for March 3, consultation starts on 600 MHz

News | December 18, 2014

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AWS-3 auction set for March 3, consultation starts on 600 MHz

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