Operators spar over MCS/MDS transition to commercial spectrum licences

An Industry Canada consultation on the migration of MCS/MDS licences to commercial broadband radio service (BRS) licences has divided the country’s wireless Internet providers regarding the appropriate geographic market size for licences. Small operators want smaller and more localized tier 3 or tier 4 licences, while the larger providers say province-wide (tier 2) licences make more sense. Unlike MCS and MDS, which are used to transmit data and video programming to subscribers using high-powered systems, BRS is a higher capacity broadband system capable provided integrated access to voice, high-speed data, video-on-demand, and interactive delivery services from a wireless device. Inukshuk Internet Inc., the largest MCS licensee in the country, argues that such wide area, high-mobility systems are better suited for provincial serving areas, which is consistent with how Industry Canada has licensed commercial mobile spectrum in the past. “The use of tier 4 areas in particular will increase the risk that large numbers of tier 4 licences will remain unlicensed following the upcoming licensing process for available and liberated spectrum in the band,” Inukshuk tells the department in comments. “This is inevitable for the simple reason that, if less profitable areas are not included in the same licence with more profitable areas, the less profitable areas will remain unassigned. Including less profitable areas in a tier 2 licence will increase the likelihood that they will be licensed and eventually implemented.” ABC Communications disagrees, noting that smaller-sized licences are more affordable to smaller companies. “And the availability of more affordable licences encourages deployment by small and local internet service providers,” the Quesnel BC-based firm writes. Other small providers go one step further arguing that they shouldn’t be required to transition their MCS/MDS licences to the new BRS designation. SSI Micro Ltd., a holder of two MCS licences in the Northwest Territories and Nunavut planning to offer Internet service to 54 of the most remote communities in Canada, says converting the licences will have a negative impact on its network. Harmonizing these bands with international standards for BRS service will decrease the channel size, and SSI Micro says “a narrower channel width will require the addition of approximately one more base station for every 12 base stations in use in order to maintain current capacity.” The financial resources to do this aren’t available, the company adds. Craig Wireless Systems Ltd. tells Industry Canada that since MCS licences were generally granted on a provincial basis, then MDS licences have to be afforded the same treatment in the transition to BRS. Since the department is likely going to auction unassigned MCS/MDS spectrum then both bands must have the same geographic serving areas. Industry Canada has proposed to adopt a fixed transition deadline of March 31, 2011 with most supporting the department’s proposal. But some believe the department must include some flexibility in the process to allow for technology upgrades to fully take place. Others, such as Bragg Communications, argue that “it is neither necessary nor appropriate for the department to force that transition in 2011.” It bases its submission on the fact that once transitioned to BRS this band will be used entirely for mobile services and that recent Industry Canada consultations (AWS auction consultation) reveal that incumbent wireless operators don’t need any additional mobile bandwidth. Licensing more mobile spectrum, according to Bragg, “would simply allow incumbent operators (i.e., those with the deepest pockets) to hoard additional spectrum for which… they have no need. In other words, making additional mobile spectrum available at this time would simply allow the incumbents to further solidify their market advantage.” Perry Hoffman is an Ottawa-based freelancer writer. He can be reached at perry@messagingmechanics.com.

Operators spar over MCS/MDS transition to commercial spectrum licences

News | August 26, 2009

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