Factbox: Canada's wireless telecom industry
TORONTO | Tue Mar 1, 2011 3:51pm EST
(Reuters) - Canada's telecom sector is dominated by three major players but has seen further competition since a 2008 government spectrum auction welcomed in new entrants to the wireless market.
Here are some facts about the industry, recent spectrum auctions and new players in the sector.
MAIN PLAYERS
Some 95 percent of the wireless market in Canada is controlled by three main players: telephone companies Telus and BCE's Bell Mobility, and cable company Rogers Communications, which broke open the industry when it launched a wireless service in the 1980s.
Rogers has almost 9 million wireless subscribers, while Telus and Bell Mobility have more than 7 million each.
SPECTRUM AUCTION PAST
The federal government raised C$4.25 billion ($4.29 billion) in a wireless auction in 2008, selling spectrum to incumbent players and cable companies looking to broaden their footprint. It also set aside a portion for new companies eyeing the lucrative market, which boasts some of the steepest rates in the world.
Ottawa's stated aim in enforcing the set-asides was to create a more competitive market, increase the number of service providers and lower prices.
The auction was for 105 megahertz of spectrum in the 2 GHz range, with 40 MHz reserved for new entrants. This spectrum is known as advanced wireless services (AWS), and is suitable for high-speed video and Internet, with faster access for cellphones and other hand-held devices.
NEW PLAYERS
Among the newcomers buying spectrum were Globalive, Mobilicity and Public Mobile. Globalive spent C$442 million and Mobilicity spent C$243 million on licenses covering Canada's major cities. Public Mobile, despite being an eligible new entrant, paid $52 million for spectrum in the populous provinces Ontario and Quebec that was not set aside.
Established cable and media companies Shaw Communications and Quebecor also bought spectrum in the 2008 auction. Quebecor launched a service in Quebec in September, while Calgary, Alberta-based Shaw has delayed its launch until early 2012.
Rogers, Bell and Telus also bought spectrum.
Under the terms of the 2008 auction, the incumbents cannot acquire the set-aside spectrum held by Globalive, Mobilicity, Quebecor and Shaw until at least the middle of 2013.
FUTURE SPECTRUM AUCTIONS
Consultations on two further wireless auctions, for 700 MHz and 2,500 MHz spectrum, are due to start early this year with auctions expected by late 2012. Discussions will cover policy issues, frequency band structure and spectrum requirements.
The 700 MHz airwaves are being freed up as most television broadcasters are due to switch from analog to digital delivery by August 2011. This frequency is considered valuable as it can cover long distances and more easily penetrate obstacles such as thick walls and buildings.
The 2,500 MHz frequency range allows for more speed and capacity, but less easily penetrates buildings.
The government has not yet indicated whether it will set aside some of the spectrum for new entrants, nor whether the new entrants from 2008 would still be eligible if they did.
($1=$0.99 Canadian) (Reporting by Alastair Sharp; editing by Rob Wilson)
Credit: Reuters (www.reuters.com)
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