ISED proposes to keep 3500 Mhz set-aside rules in 3800 Mhz auction consultation doc

The department of Innovation, Science and Economic Development (ISED) is proposing to keep the set-aside spectrum auction rules established in its recent 3500 Mhz auction for its planned 3800 Mhz auction, despite Quebecor Inc.’s purchase of the recent set-aside spectrum being challenged in court. ISED announced a consultation process for the rollout of 3800 Mhz band (3650-3900 MHz) late Friday afternoon after parliament had risen for the Christmas break. The consultation follows a decision announced in June by Minister François-Philippe Champagne to use the 3800 Mhz band for 5G services. The spectrum auction will take place in 2023. A 110-page background document released at the same time fleshes out the proposal. In its document ISED proposed to use the same criteria as those used in the 3500 MHz auction which limited eligibility to bid on set-aside licenses to those registered with the CRTC as facilities-based providers, that are not national mobile service providers (NMSPs), and “that are actively providing commercial telecommunications services to the general public in the relevant Tier 2 service area of interest” effective as of the date of application to participate in the auction. NMSPs are defined as “companies with 10 per cent or more of national wireless subscriber market share.” In the 3500 MHz auction a set-aside of 50 MHz (approximately 25 per cent of the total band; 42 per cent of spectrum at auction) was made available which Shaw Communications Inc. was expected to purchase before it decided to sit out the auction on the heels of the announcement of its deal to be acquired by Rogers Communications Inc. ISED did not adjust the rules for the 3500 Mhz auction around set-aside spectrum and Quebecor Inc.’s Videotron subsidiary spent just shy of $830 million on 294 set-aside spectrum licenses covering approximately 30 million people in Ontario, Alberta, and British Columbia combined as part of its attempt to become the fourth national competitor. In August, BCE Inc. and Telus Corp. filed parallel court challenges with the Federal Court arguing seeking to block the purchase. The incumbents argued that Quebecor should not have been eligible to bid on set-aside spectrum because the 3500 Mhz auction rules dictated that only companies that are “facilities-based providers” that are “actively providing commercial telecommunications services to the general public” are allowed to do so. In October the court rejected Telus’s request for an injunction to stop ISED from issuing licenses, however, full judicial review remains to be heard. Friday’s consultation document also notes that 25 blocks of spectrum will be made available in the 3650-3900 Mhz band range. The plan would support long-term evolution (LTE) and 5G New Radio (NR) to operate using a 10 Mhz channel bandwidth and be licensed in Tier 4 service areas (172 localized service areas ). “Although licensing based on smaller tier sizes such as using Tier 5 might afford licensees additional flexibility, the smaller tier size, given the propagation characteristics of mid-band spectrum, larger tiers could better enable licensees in maximizing the benefits of higher power deployments while minimizing interference concerns between neighbouring licensees, especially in urban areas,” ISED wrote in its consultation document. ISED is also suggesting that spectrum set-aside or a cross-band spectrum caps be applied across the 3500 MHz and 3800 MHz bands for bidders. Three options have been proposed: a 50 Mhz set aside; a 100 Mhz cross-band cap across the 3500 Mhz and 3800 Mhz bands; and a 50 Mhz set aside and a 100 Mhz cross-band cap. ISED proposed that if a cross-band spectrum cap is applied, in licence areas where a licensee already holds 3500 MHz spectrum licences, in excess of the spectrum cap they would not be eligible to bid for additional licences in the 3800 MHz band auction in service areas where the spectrum cap has been met. The department is presenting a pricing scheme based on money, Mhz and population, dependent upon the number of census metropolitan areas (CMAs) in each region. For service areas over 2 million the fee would be $0.232; for areas between 1 and 2 million, $0.1; under 1 million with at least one CMA $0.065; and all remaining areas $0.051. There will be a 60-day comment period for the consultation, followed by a 30-day reply period. –Reporting by Paul Park at ppark@thewirereport.ca and editing by Jenna Cocullo at jcocullo@thewirereport.ca

ISED proposes to keep 3500 Mhz set-aside rules in 3800 Mhz auction consultation doc

News | December 20, 2021

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ISED proposes to keep 3500 Mhz set-aside rules in 3800 Mhz auction consultation doc

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