Canadian AWS Auction is On
Canada’s government has launched an auction of wireless spectrum on Tuesday, reports Reuters, that will allow new players to break into the cellular phone market in the AWS band (1.7/2.1 GHz).
A total of 105 MHz of AWS radio spectrum will be open for bidding (map), which includes 40 MHz of AWS spectrum specifically set aside for new players, with another 65 MHz of spectrum for all bidders.
With only about 60 per cent of Canadians subscribing to a cellphone service, Canada is behind in adopting mobile communications. Canadian cellphone users pay higher prices than their U.S. or European counterparts, observers say, largely because there is less competition.
The three big players — Rogers Communications, Telus and Bell Canada Enterprises control about 95 percent of the wireless market in terms of revenue. A list of qualified bidders, released in April, included wireless newcomers Quebecor, Manitoba Telecom and Shaw Communications.
Analysts have doubts that any of the new players have enough money to launch very serious competition to the incumbents on a national scale. Quebecor, for example, is expected to initially target its home province of Quebec. Shaw, a cable and satellite TV company, has cautioned that its participation in the auction doesn’t necessarily mean it will build a network at all.
Manitoba Telecom suffered a setback last week when the consortium it had formed to participate in the auction dissolved. The company said it was still qualified to bid but analysts doubt it can expand its network beyond the province of Manitoba.
But the auction may result in increased competition, officials say, and pressure prices downward.
The auction is expected to raise up to $1 billion for the government treasury. Some 24 companies can bid electronically on 292 licenses in different geographical regions across Canada. The results of each round will be published on Industry Canada’s website.
In the first stage of the auction, officials raise the price on each license that received bids by 15 percent after each round. As the auction progresses and bids slow down, the price increase is smaller between rounds.
The AWS auction in the United States was held in 2006.
| Bidders | Net total of high bids |
| 1. T-Mobile | $4.2 billion |
| 2. Verizon Wireless | $2.8 billion |
| 3. SpectrumCo | $2.4 billion |
| 4. MetroPCS | $1.4 billion |
| 5. Cingular | $1.3 billion |
| 6. Cricket | $710 million |
| 7. Denali Spectrum | $365 million |
| 8. Barat Wireless | $127 million |
| 9. AWS Wireless | $116 million |
| 10. Atlantic Wireless | $81 million |
| Click here to find out who is backing these bidders. | |
T-Mobile was the big AWS winner in the United States.
| SOURCE: WiMAX Day
|
European operators are eagerly anticipating the 2.5-2.6 GHz auctions planned for the next two years, says Jeff Orr. However, not every EU country is ready to move ahead.
Sweden was the first EU member state to conclude a 2.6 GHz sale with 14 channels of paired 5 MHz FDD spectrum and a single unpaired swath of 50 MHz for TDD use. The Swedish auction was the first foray of chipmaker Intel into the business of spectrum ownership.
Norway completed its 2.5 GHz auction in November 2007. The Norwegian Post and Telecommunications Authority (NPT) issued licenses to five companies, including: Arctic Wireless, Craig Wireless, Hafslund Telekom, NetCom, a subsidiary of TeliaSonera, and Telenor.
Several EU countries, including Austria, France, Germany, Italy, the Netherlands, Portugal, Spain and the United Kingdom are preparing for similar auctions from 2008-2010 in anticipation of next-generation mobile networks. While the 50 MHz TDD block recommended by CEPT is nothing to scoff at, mobile WiMAX systems are not invited to play in the 140 MHz sandbox dedicated to FDD systems, says Orr.
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