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Canada moves to open wireless market to new entrants

Thu, 03/15/2012 - 3:04pm
Maisie Ramsay, Wireless Week

Canada announced yesterday it is opening its telecommunications market to foreign investors and capping the amount of spectrum that can be owned by operators as it works to inject more competition into its wireless market, which is dominated almost entirely by Rogers, Bell and Telus Mobility.

The policy changes will lower prices for consumers and give new entrants a better chance of competing against incumbent providers, Industry Canada Minister Christian Paradis said in a transcribed copy of his Wednesday afternoon speech.

The country is amending its Telecommunications Act to lift foreign investment restrictions on companies that hold less than a 10 percent share of the Canadian telecommunications market.

It also will limit the amount of spectrum that can be purchased by a single company in its upcoming 700 MHz and 2500 MHz auctions to "facilitate four or more companies in each license area securing this spectrum."

"This will enable new entrants to acquire this valuable spectrum and improve their ability to compete," Paradis said.

The 700 MHz auction is scheduled for the first half of next year, and a portion of the band will be reserved for use by public safety. The 2500 MHz auction will follow "within a year" of the 700 MHz sale.

Companies that win more than one block of 700 MHz spectrum or gain access to it through sharing agreements will be required to deploy networks covering 90 percent of the population in their coverage area within five years and 97 percent of the population within seven years. The government also decided to "indefinitely extend" policies on mandatory roaming agreements and tower sharing first enacted in 2008.

Start-up Canadian operator Wind Mobile said the changes didn't go far enough and criticized the spectrum caps, which it said will leave new entrants shortchanged on the spectrum they need to deploy LTE.

"The government is prepared to take credit for creating a level playing field in the upcoming auction, when all they've really done is stack the deck in favor of the incumbents," the company said in response to Paradis' speech. "To build out an LTE network, 10 MHz of spectrum is necessary. This decision only allows new entrants access to half that amount and will prevent any carriers, other than the incumbents, from building faster networks."

Wind Mobile and other operators like Lynx Mobility hold just a fraction of the Canadian wireless market.

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