The opinions expressed in this editorial are those of the author and do not necessarily reflect those of Decima Reports. The subject of eligibility will likely be one of the more contentious issues in Industry Canada’s proposed auction of high-speed Internet spectrum. While the incumbents will preach the advantages of letting market forces rule, small wireless companies will push for limited participation by dominant carriers. Some emerging WSPs, primarily those in western Canada, already use some of this spectrum to provide high-speed Internet access to rural communities around the major centres (RoW, Oct. 2/00 and Oct. 16/00). They warn that if the dominant carriers are allowed unfettered access to bid on all licences, smaller players will be squeezed out of the market by unfair competitive pricing. In their defence, the incumbents will undoubtedly point out that the government is moving towards less regulation and greater reliance on market forces. To limit their participation would be a step backwards. Incumbents can also sell themselves as a safer bet for fulfilling the government’s broadband dream than less established companies that aren’t always able to follow through on licence commitments (remember MCS and LMCS?). Although well-intentioned, the government hasn’t always succeeded when it comes to so-called "managed competition". In an area as volatile and uncertain as the Internet, it should be market forces that decide winners and losers. That’s not to say that new entrants are locked out. When plans to auction spectrum in the 24/38 GHz bands was announced, new entrants predicted a sweep by deep-pocketed incumbents in the major urban centres. But when it all played out, it was the newcomers like Norigen and Wispra that won the most sought-after properties. There’s no question that demand for bandwidth is soaring in Toronto, Montreal and Vancouver. But will small WSPs really be the best to provide service in those large cities? Likely not. Incumbents will bid aggressively in areas where demand is highest. That, in turn, will open the door to new entrants and smaller existing players to win a majority of the tier 2 licences. If the small guys want to compete in the hotter real estate markets, they’ll have to pay market rates. That’s what competition is all about.