March 7, 2013 9:19am
Industry Minister, Christian Paradis, held a press conference early this morning to outline the series of events that will lead up to a November 19th auction for the highly-coveted 700Mhz spectrum. Already in use in the United States, the 700Mhz band will facilitate wireless signals that more easily penetrate walls and deliver faster speeds in rural areas.
Citing renewed need for a competitive marketplace, Paradis ensured that all Canadian provinces will have at least four companies for customers to choose from. Similarly, at least four companies per region will be able to bid on the sought-after spectrum in November thanks to new rules around foreign investment.
The Canadian government will redouble efforts, he said, to “reduce cellphone proliferation,” by ensuring incumbent providers share towers with new entrants; no Canadian should be left without a cellphone signal, regardless of where they are in the country. WIND and Mobilicity, two of recent entrants to the national stage, currently roam on Rogers’ 2G EDGE network when outside so-called “domestic home zones,” differentiating between those areas, usually in larger cities like Toronto, Vancouver and Calgary, and “domestic away” zones.
This announcement, and promises of “greater wireless coverage at lower rates for consumers,” according to the Minister, come after consultations and public hearings around a proposed “Wireless Code of Conduct.” The Code, the final draft of which has yet to be completed, argues for more accessible unlocking plans by the carriers, less penalties when cancelling a three-year contract — often lambasted as the longest in the world — and discounts for users who choose to bring their own phones.
When the auction begins in late November, there are expected to be more companies fighting over less spectrum than the 2008 AWS auction that raised $4 billion for the Canadian government. Estimates put the 700Mhz spectrum between $2.9 and $3.5 billion, with incumbents Rogers, Bell and TELUS making up the majority in most large markets. Companies like Quebecor, Eastlink, SaskTel, MTS, Mobilicity and WIND Mobile, many of which emerged from the 2008 auction, have launched regional or national wireless networks, but few of them, especially the latter two, don’t have enough spectrum to launch LTE. It’s likely, especially based on WIND Mobile’s parent company Orascom’s poor quarterly earnings, that there will be an “in-market merger” with a company like Mobilicity, largely seen as a necessity in a market unwelcoming to new entrants.