Bains says spectrum auction dates to give industry predictability

TORONTO — Innovation Minister Navdeep Bains announced Wednesday the timing of the next three spectrum auctions — including the much talked-about 3.5 GHz — as well as a $10-per-month broadband plan for low-income families that critics say puts incumbents in control. Industry will see three auctions occur in the next three years: the 600 MHz in 2019, 3500 MHz in 2020, and 1 GHz of the millimetre wave in 2021. Speaking at a telecom industry conference in Toronto, Bains said it was too early to talk about potential set-asides for smaller players. He also said all bands are important for 5G deployment, but he emphasized the 3.5 GHz frequency. “The 3500 megahertz spectrum is going to be one of the essential parts and bands for the 5G services,” Bains said in his announcement. “The consultation reflects our commitment to get this spectrum to the marketplace in timely manner and that also supports competition — a key priority of our government.” Over the past couple of days, the Telecom Summit heard from some incumbent telecom executives, including from Telus Corp., who’ve urged the government to release the spectrum as quickly as possible for them to compete against global players in the “race to 5G.” Bains said Wednesday he’s heard them loud and clear. “Let me assure you: our proposals align with international trends in the band and represent an important step toward ensuring that the 3500 will be available to meet consumer demand for 5G.” In a statement, Telus' senior vice-president of government and regulatory affairs Johanne Senecal said the company welcomes Bains' announcement. Though she noted the company "would have preferred an expedited timeline for upcoming spectrum auctions to catch up to other countries that have already begun auctioning spectrum." Senecal added that Telus looks forward to participating in the consultations and will be doing "everything we can to launch 5G as swiftly as possible." In consultations on the five-year spectrum outlook, the telecoms clamoured for the release of the spectrum in a timely manner. Meanwhile, earlier this year, BCE Inc. used the 3.5 GHz band in fixed wireless trials in rural areas. Bains told reporters that the timeline provides predictability and puts Canada in the top five versus international peers and ahead of countries like Australia or Germany. “It’s about our commitment to making the right spectrum available at the right time to meet current and future demand,” he said. Scotiabank analyst Jeff Fan said in a research note that “the launch of the consultations and update on the timing of the auctions provide the companies and investors with better clarity on the 5G rollout.” The big three players did not address whether the timeline was too late when reached for comment. Bains also said that part of its Innovation and Skills Plan, ISED’s Connecting Families program will plow $13.2 million over five years toward an online portal that eligible families will be able to use to get internet at 10 Mbps download speeds at $10 per month with 100 GB of data. Another program will distribute 50,000 computers to those households. Bell, Rogers Communications Inc., Telus, Shaw Communications Inc., Cogeco Inc., and Quebecor Inc.’s Videotron will deliver the services. But the fact that only incumbents are servicing the new program did not sit well with some smaller providers. “The parties that he talked about working with to achieve it, again, are all incumbents — there’s no reason for that,” Andy Kaplan-Myrth, vice-president of regulatory at TekSavvy Solutions Inc., said in an interview. “Competitors, independents have a role to play in this, but at regulated rates that we pay, we just can’t do $10 service plans.” Kaplan-Myrth suggested perhaps a subsidy model — for example, a joint arrangement — for the small providers to deliver the services. Currently, wholesale rates are too high for the smaller players to be able to deliver those services, Kaplan-Myrth explained. “We would love to be at the table, talk to government about how we can be part of delivering those services,” he said. “Not being at the table is part of a general trend in sort of marginalizing competitors that really concerns me.” Matt Stein, spokesman for the Canadian Network Operators Consortium (CNOC) and CEO of Distributel Communications Ltd., acknowledged the difficulty in getting all ISPs involved, as CNOC members were not approached about the program. Stein, otherwise, praised the program as a “wonderful charitable initiative” in an email. The Public Interest Advocacy Centre (PIAC) welcomed the plan in a blog post on Wednesday, but also expressed concern on several fronts: that no other internet service providers will participate, there are no regulatory guarantees that the incumbents will maintain the program to the end of the five-year period, and it leaves out some families, as the program is targeted to those with children. “This is half a loaf offered to only some low-income Canadians and not to others,” PIAC executive director John Lawford said. “While better than nothing, this ‘political solution’ is the direct result of the CRTC refusing to create a fair and equitable subsidy to support affordable Internet for all low-income Canadians,” Lawford said in the post. In a press release, internet advocacy group OpenMedia said while the plan is a forward step, it doesn’t go for enough, noting that the 10 Mbps speeds are significantly lower than the CRTC’s basic service standard of 50 Mbps. Executive director Laura Tribe said in the release that there is still an urgent need for a national broadband strategy. “Millions of households that do not meet the eligibility requirements to the Connecting Families initiative but nevertheless battle day to day to afford their necessities, will be left behind,” she said. Some incumbents already have $10-per month plans. In 2013, Rogers launched a $10 plan with 3 Mbps download and a 30 GB montly cap for $10. In 2016, Telus launched a pilot program In British Columbia — which expanded to Alberta — for single-parent families called Internet for Good, which offers 25 Mbps downloads with a 300 GB cap per month for that same price. For Bell, Wednesday’s announcement will be its first foray into $10 deals. All three said in separate statements that they look forward to delivering the services. — With reporting by Ahmad Hathout at ahathout@thewirereport.ca and editing by Anja Karadeglija at akarad@thewirereport.ca

Bains says spectrum auction dates to give industry predictability

News | 06/06/2018 6:51 pm EDT

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