Might be ‘late’ for regional wireless competitors: Cogeco

Cogeco Inc. is raising caution about the negative impact the government's existing auction formats could have on regional wireless players after it backed out of a significant 600 MHz spectrum auction it said focused on locations too large for it to compete. That auction for the crucial 600 MHz spectrum represents the last big chance in some time to take hold of low-band frequencies widely considered important for a wireless operation. The list released by Innovation Canada last month did not include Cogeco, which said the auction model was not economical for it -- though it maintained it isn’t abandoning its wireless ambitions. But in a submission to the panel reviewing Canada’s communications laws, Cogeco said the 600 MHz spectrum auction represented “the last of its kind for the foreseeable future” and that “no significant amount of spectrum below 1000 MHz will soon be available.” “Any company without sufficient blocks after this auction will be unable to obtain any,” it added. “This creates a long-term, structural barrier to increased competition.” The auction is slated to take place this year. Other scheduled auctions include the 3.5 GHz in 2020 and millimetre wave in 2021. The Montreal-based cable company harkened back to recommendations made by the country’s auditor general -- including focusing on the size of geographic areas, deployment conditions, and unused spectrum in underserved areas -- suggesting it “might be late in the game for reaping the full benefits that smaller tier auctions could have generated in fostering the emergence of regional facilities-based players.” Late last year, ISED launched a consultation on a newly proposed category of smaller service areas for spectrum licensing, known as tier 5, but that won't affect the 600 MHz spectrum auction. To address some of this problem, Cogeco recommends the government “encourage wireline facilities-based broadband providers to enter the wireless market via a limited and orderly mandated wholesale regime to be offered at regulated tariffs by the 3 national wireless providers.” This recommendation is in line with Cogeco’s favourable view of mandated roaming for mobile virtual network operators (MVNOs). Cogeco’s wireless ambitions have been shrouded in mystery since it emerged that the only Canadian telecom without such a business was interested in a profitable way to enter that market. Early last year, it indicated a renewed interest in wireless, which it said was driven by the opportunity to jump directly into building a 5G network. It bought $24.3-million worth of 2300 and 2500 MHz spectrum in May, followed by another $8 million worth of the 2500 MHz in June. In a first quarter conference call this year, executives said the 600 MHz isn’t an absolute must-have for networks, adding they are communicating with ISED about other models. Analysts have also speculated that a spectrum-sharing arrangement could be one likely option, if it finds a partner. The company under previous head Louis Audet said it may be able to hurdle over the current technological challenges by planting small cells, crucial for ubiquitous connectivity 5G promises, on cable facilities. In its submission to the review panel, Cogeco said the rules should adopt a new technology-neutral approach because the wireline and wireless networks are quickly converging -- wireline traffic is “increasingly originating” over WiFi and mobile networks are using more backbone fibre as they move to LTE. But Cogeco added that because of this convergence, those without a strong underlying network infrastructure “will not succeed” as those technologies converge. The company’s 26-page submission also touched on other major points of interest to the panel on telecom matters, including net neutrality, which it supports but suggested not to put in “statutory rigidities,” as well as the “anti-competitive” behaviour of vertical integration. On broadcasting matters, Cogeco said the government should focus on discoverability of Canadian content and ensure that all broadcasting players “active in the provision of audio and audiovisual information and entertainment content to Canadians within Canada must either be required to contribute in an equitable manner to Canadian content funding, or else be equally relieved of such funding contributions.” If contribution from all players is required, it said the governor-in-council should issue a policy direction to the CRTC to require all online service providers, non-Canadian providers included, to report their Canadian subscriber numbers, subscription and advertising sales above a minimum, and direct the CRTC to review the digital media exemption order to require those players to contribute to the system as a condition of licence exemption. Cogeco also recommended having improved access to over-the-air radio stations by mandating smartphones sold in the country to have activated FM chips. Unlocking FM chips in cell phones is not a new proposition, with the idea previously spawning a campaign. Early last year, Samsung Electronics Co. Ltd. announced that it would unlock the chips on new devices. CLARIFICATION: This story has been updated to clarify the context of Cogeco's concern about regional wireless players. — With reporting by Ahmad Hathout at ahathout@thewirereport.ca and editing by Anja Karadeglija at akarad@thewirereport.ca

Might be ‘late’ for regional wireless competitors: Cogeco

News | 01/23/2019 5:05 pm EST

To keep reading, get a free trial.

Already a Subscriber?

Related Stories

Freedom answers to ‘unlimited’, offers $0 phones on select plans

News | 07/25/2019 6:41 pm EDT

No broadcaster compensation for 600 MHz move, ISED confirms

News | 05/28/2019 1:48 pm EDT

Shaw says patience, not regulation, required to see organic MVNO market

News | 05/17/2019 4:55 pm EDT

Reuse & Permissions

Inside The Wire Report

Information

Hill Times Publishing

Get in Touch With Us