Wireless spectrum debate under way

29 May 2007

Canada’s existing mobile operators and potential new entrants have submitted proposals for a new auction of wireless spectrum scheduled to be held early next year. Industry Minister Maxime Bernier in February issued a discussion paper that asked interested parties to suggest rules for the auction, with the deadline for proposals set for last Friday. Parties have until 27 June to issue rebuttals to others’ suggestions, and the government is expected to announce final auction rules this autumn. The three national network operators Rogers Wireless, Telus Mobility and Bell Mobility say they need more spectrum for new advanced services, including mobile video, and back an open highest-bidder auction process. Regional providers such as MTS and SaskTel, and any prospective new bidders, are in favour of reserving spectrum for a fourth national licence that Rogers, Bell and Telus are prohibited from bidding on. Prospective entrants are also expected to ask the government to mandate roaming charges between carriers and force existing cellcos to lease infrastructure to new rivals. MTS argues that an open auction would simply allow the national incumbents to raise the bidding price beyond the reach of newcomers. Bell Canada on Friday recommended that Industry Canada auction spectrum for advanced wireless services (AWS) using an open framework that does not give potential new entrants special advantages. The company expressed the opinion that government intervention in the market such as spectrum caps or set-asides in the auction process would, in effect, subsidise new entrants at the expense of mobile users. ‘Industry Canada’s obligation is to obtain the maximum benefit for advanced wireless services (AWS) spectrum for all Canadians – not just new entrants,’ the company said, adding that ‘the simplest way to achieve that goal is to auction off the AWS spectrum to the highest bidders who can use it to deliver the next generation of communications tools and services.’ The government has signalled that it would like to see new wireless players.