ISED’s non-competitive licensing framework provides needed flexibility for regional players: expert

WINNIPEG-One of Canada’s leading experts in spectrum policy says ISED is finally opening up good chunks of spectrum to be used for rural, remote and Indigenous connectivity which will in turn open the door for smaller regional players. “Even with set-asides and spectrum caps some of the small wireless players were never going to be involved for two reasons: one: the price of getting involved in an auction, and second: the tier sizes were too big," Gregory Taylor, the principal researcher for Canadian Spectrum Policy Research and a professor at the University of Calgary, told the Wire Report in a phone interview. "This is something that has been a big problem in some of the earlier auctions, and I think we're starting to see that being remedied.” Last week, Innovation, Science and Economic Development Canada (ISED) released comments received on its consultation on a non-competitive local (NCL) licensing framework covering the 3900 MHz band and the mmWave band. Mark Saunders, a manager in ISED’s spectrum policy branch, gave a talk on the department’s spectrum access initiatives at the Indigenous Connectivity Summit on Tuesday and said the NCL framework will be more flexible in terms of service areas. “What is kind of cool about this one is that it is different than our different policies and frameworks because it allows for more customizable licence areas,” he said. Saunders said ISED is developing a user-friendly tool where prospective spectrum users can carve out specific areas for use (a vector-based licence area). It is a map that starts with a Tier 5 area (the smallest pre-defined service areas) and allows a user to draw around the area in which they wish to access spectrum (such as a university, mining area, a forest, or Indigenous community). “Essentially what it will allow is more access to more users and to facilitate more access for Indigenous communities by allowing them to draw around the community themselves,” he said. Taylor said the NCL framework also provides flexibility with its deployment conditions, which no longer calls for 20-year licence terms. “In my view, it's been a big problem in the past and I've hammered this in my submissions for years. They used to have 20 year leases. And my point was always that's an eternity in the digital world. And now they're starting to get a little shorter,” Taylor said. ISED proposed one year leases in its NCL framework and then reviewing the licences once its term is up. The shorter terms, coupled with the smaller tier sizes will allow smaller players to hit their deployment targets in terms of area covered and population served. “And they're smaller players in areas that you know, Rogers, Bell and Telus have ignored now for 20 years and so there shouldn't be any protest from them saying ‘well what about us?’ Well, they've had the run of the table for 20 years,” Taylor said. The Canadian Association of Wireless Internet Service Providers (CanWISP) on the other hand told ISED that the framework “does not enable small local telecommunications service providers to access high-quality spectrum.” CanWISP argued in its Oct. 11 intervention that ISED’s wireless broadband services (WBS) framework, made available on an all-come all-served basis, stimulated investment in rural communities that have been under served by large national service providers. Yet in 2021, ISED displaced users from the WBS band (the 3800 MHz band). “Investments in expanding and improving rural networks have been suspended or delayed. Based on ISED’s stated intentions, CanWISP members anticipated that the 3900 MHz band would provide a viable platform for future investment. The NCL licensing framework, as proposed by ISED in this consultation, does not provide that platform.” CanWISP wrote to ISED that its members cannot fully use other bands, such as TV whitespace, 6 GHz, 5150-5250 MHz, and 5850-5895 MHz, to build broadband networks. The TV whitespace band is useful for connecting the most remote areas but does not support widespread delivery of 50/10 service. The power level restrictions in the 6 GHz and 5150-5250 MHz bands would require significantly more base station sites, therefore, significant capital investment with no additional coverage, customers or revenue. ISED is also coupling its non-competitive licensing with an access licensing (“use-it-or-lose-it”) framework to tackle rural and remote connectivity as well as better connectivity for Indigenous communities. A decision is still pending on that framework. CanWISP, in its consultation response to the NCL framework, noted that the access licencing framework will likely only be used in very narrow circumstances. CanWISP took issue with the one-year licence terms, arguing it does not provide the business certainty required to invest in building rural broadband infrastructure. “In transitioning from the WBS band to the new 3900 band, WISPs will be required to make substantial investments in new equipment and infrastructure. It will take years to realize a positive return on these investments. Network operators will not invest in rural infrastructure without a longer licence term,” it wrote. CanWISP further proposed that ISED prohibit the national mobile service providers (BCE Inc., Telus Corp. and Rogers Communications Inc.), along with the regional mobile service providers (Saskatchewan Telecommunications Holding Corp., Shaw Communication Inc.’s Freedom, Quebecor Inc.’s Videotron, and Xplore Inc.) from obtaining NCL licences. “These large companies have a strong incentive to foreclose access to smaller operator ISED is also right to seek methods to prevent NCL licensing from becoming ‘an extension of the commercial mobile networks operated by large and regional service providers.’ A straightforward prohibition of large national and regional mobile network operators from accessing these licences achieves the purpose of preventing foreclosure, while preserving the utility of the spectrum,” CanWISP wrote. “An exception to this prohibition should be allowed for WBS deployments that are actively serving customers to be transitioned to the 3900 MHz band,” it added. CanWISP also proposed that ISED lift its proposed spectrum cap of 20 MHz in the 3900 MHz band, with the possibility of a higher spectrum cap in rural areas. “A spectrum cap of 20 MHz will render the 3900 MHz band ineffective for providing broadband connectivity using fixed wireless networks,” it wrote. “It severely limits the commercial viability of the 3900 MHz band beyond extremely limited deployment scenarios.” Meanwhile, Canada’s big three telecommunications providers, generally supported the NCL framework. Bell, in its Oct. 11 submission, said it supported the vector-based licence areas. In addition to the custom vector-based licence areas, ISED has also proposed a radius-based licence area – based on a specified circular licence area with a defined radius from a specific geographic point. “The custom vector-based licence area approach ensures that the spectrum licence only covers the deployment area of interest and therefore maximizes spectrum efficiency. The radius-based approach, on the other hand, may create licence areas that contain geographic areas that the licensee is not interested in serving,” the company wrote. Bell also supported a first-come first-served model (which offers certain protections from ISED) as opposed to all-come all-served (no priority among operators and no restriction on where operators can acquire additional spectrum licences and deploy). Bell noted that the Internet of Things (IoT) and industrial applications are likely to require low latency, which require a high quality of service and no interference. “Using a FCFS approach, in conjunction with the department reviewing applications and deployment plans will provide the department with the opportunity to remedy interference issues before they arise.” CanWISP argued for an all-come all-served approach, arguing it is an administratively simpler framework, and it will support more spectrum users. In its Oct. 11 submission, Rogers argued ISED’s proposed base fee rates for the NCL bands “are much too high.” ISED is proposing an NCL low-band and mid-band licence fee base rate of $35.93 per MHz per km2 for metro/urban areas, adjusted for area size instead of population – with a discounted base-rate of $8.98 for rural areas and $1.80 for remote areas. “In particular, the proposal to use the current cellular and personal communications service fee-rate – a fee rate that is already much too high in absolute and relative terms compared to peer countries – as a comparable fee base rate for 3900- 3980 MHz is bad for Canadian wireless policy.” Rogers argued that the fee rate is only appropriate for low-band spectrum in urban and metropolitan areas; and the fee rate should be “progressively reduced” for higher bandwidths where spectrum is more available. “It would also set an incredibly negative precedent for future commercial mobile/flexible use spectrum base fee rates, which would ultimately harm rural wireless deployments with already challenging economics while also greatly impacting affordability for all wireless customers in Canada,’ the incumbent wrote in its submission. Rogers said ISED should consider an approach that is based on the number of apparatus licences requested within a Tier 5 area. The company said basing its fees on an area (km2) basis will force operators to focus deployment on population centers rather than covering wide areas. Reply comments for the framework are open until Nov .14. At the Indigenous Connectivity Summit, Saunders encouraged Indigenous service providers and other telecommunications stakeholders to participate in the process. This is one of the first times ISED has specifically added consultation questions related to Indigenous connectivity, he pointed out. ISED is seeking comments on “approaches that would make the NCL licensing accessible for Indigenous service providers, businesses and communities,” on how it should define a licence applicant as Indigenous, and comments about “the challenges (e.g. administrative, regulatory, technical etc.) Indigenous peoples face when accessing spectrum, and suggestions on how ISED can remove these barriers.” In an Oct. 11 intervention, Eeyou Communications Network, a Cree-majority owned broadband service provider in Queebec’s North, used the opportunity to bring up Indigenous spectrum sovereignty. The not-for-profit company noted Canada’s recent commitment to the United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP), and argued that Indigenous communities should be rights holders, not stakeholders in the telecommunications sector. “The current approach used by ISED, CRTC, and industry is to treat Indigenous peoples as one of many stakeholders in projects that affect their communities and territories. This is in direct contradiction to the roles and responsibilities of Indigenous rights holders as defined in the UNDRIP,” Eeyou wrote. Eeyou noted that UNDRIP states that Indigenous peoples have an “inherent right to self- determination” and that UNDRIP is a framework for reconciliation applicable in all sectors of society, including telecommunications. “As the inherent right holders, First Nations have the right to access, own, engage with, and administer digital technologies; influence and benefit from the technology sector; and provide leadership in the development of policies, regulations, and laws concerning digital technologies,” Eeyou wrote. Eeyou suggested that ISED engage in direct consultations with Indigenous communities rather than requiring them to participate as intervenors. “Currently, as far as we can determine, no First Nations entity holds a spectrum license for the provision of Internet, thus many of the more technical questions will be impossible to answer. If one has no experience holding and managing a spectrum license, it is very difficult to ascertain the best methodology for determining aggregate limits for example.” Finally, the company said ISED should should recognize spectrum as a natural resource and recognize Indigenous inherent rights over that natural resource. Saunders did note at the Indigenous Connectivity Summit that last month ISED’s spectrum policy branch started an Indigenous Spectrum Policy Team. The small team is led by Saunders and composed of several individuals with spectrum policy experience and experience in Indigenous engagement. – Reporting by Jenna Cocullo at jcocullo@thewirereport.ca and editing by Michael Lee-Murphy at mleemurphy@thewirereport.ca.

ISED’s non-competitive licensing framework provides needed flexibility for regional players: expert

News | October 26, 2022

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