Set aside more wireless spectrum for new entrants: government

The federal government wants to give new entrants to Canada’s wireless market a leg up against the Big Three providers when it auctions off the next block of wireless spectrum.

On Friday, Innovation, Science and Economic Development Canada launched a consultation on the framework to auction spectrum licences in the 600 MHz band, a particularly valuable block of radio frequencies needed to power the growing demand for mobile communications.

Of the 70 MHz of spectrum available, the ministry proposed setting aside 30 MHz — 43 per cent — for facilities-based wireless providers that have less than 10 per cent of the national wireless subscriber market share. That includes regional carriers Shaw Communications Inc.’s Freedom Mobile and Quebecor Inc.’s Videotron. But it excludes incumbents BCE Inc., Rogers Communications Inc. and Telus Corp., which each serve roughly 30 per cent of Canada’s 30 million wireless subscribers.

Set-asides are “used to address issues of market power,” the ministry stated.

The department proposed making the licences non-transferable for five years to deter speculation. Videotron recently made millions selling set-aside spectrum that it never used to Rogers and Shaw.

The auction for the remaining 40 MHz would be open to all bidders. The department, which is seeking comments on its proposed auction rules and format, proposed kicking off the bids at $1.54 billion or $219.5 million per 10 MHz block. The U.S. auction of spectrum in the same band yielded $19.8 billion in revenue for 84 MHz.