Canada is opening its wireless spectrum to foreign companies in an attempt to bring more competition to the Canadian telecommunications market. Industry Minister James Moore began a cross-country speaking tour August 16 to emphasize that message amidst a strong lobbying effort from Canada’s three main telecommunications companies.
The next auction of the wireless spectrum is scheduled for January 14, 2014. Currently, Canada is one of the world’s ten most expensive countries for wireless services, with some of the highest roaming rates. International competition is expected to help remedy that. Currently, Canada’s three major wireless service providers – Rogers, Telus and Bell – own 85 percept of the Canadian wireless spectrum and hold 90 percent of its telecommunications market. They have launched a multi-million dollar ad campaign to maintain their positions. Prime Minister Stephen Harper wants to see a fourth competitor in each regional market, and points out that prices have dropped whenever competition has increased.
Canadian policies enacted since 2008 now allow foreign investment in companies that have less than 10 percent of the Canadian telecommunications market. For a foreign company to have more than 10 percent of the market, it must grow organically – not by mergers or acquisitions. Verizon Communications initially expressed interest in entering the Canadian market, but now appears to be wavering in its negotiations. No other major American players have indicated interest at this point.
The upcoming 700MHz spectrum auction includes caps to ensure that new entrants and regional service providers have access to prime spectrum. It also has set conditions so wireless services can be delivered expediently in rural areas. One of these methods extends tower sharing and roaming policies. That policy can make a particular difference in underserved areas, including British Columbia’s Gulf Islands, where towers easily can handle additional traffic.