New Wireless Spectrum Auction Pegged for 2012?

by Jordan Richardson on November 23, 2010

Industry Minister Tony Clement says that he’s expecting a new wireless spectrum auction in 2012. While some crazies might think 2012 marks the end of the world, Clement says that the year could mark the selling of 700 MHz wireless spectrum. Consultations on the possible auction will begin “shortly.”

Clement made the announcement while speaking at the International Institute of Communications in Ottawa. He also alluded to another round of consultations over the auctioning of 2,500 MHz wireless spectrum, with those consultations set to take place in 2011.

The 700 MHz spectrum is currently the purview of the television broadcasters, but the upcoming analog-to-digital switch will make that available for wireless communications networks by mid-2011. That should give the auction plenty of time to be prepared and implemented effectively.

This is a sign of forward thinking from the government, as it shows they are seeing the writing on the wall with respect to network clogging. Analysts have long pointed to the signs of heavy network traffic due to data usage, so this auction should be taking place right on schedule. Allocating spectrum can take years, says Duncan Stewart of Deloitte Canada, and it can’t be reversed once it’s doled out.

“If you are currently not happy with your wireless connection, this is a big part of how that problem gets solved,” says Stewart.

Also part of the agenda for Clement is a revisiting of the foreign ownership rules prior to the auction. Some things will still need to be hammered out in terms of how the rules apply before the doors to spectrum are opened to the companies with an interest. “This just makes sense,” he said. “After all, how spectrum is allocated and who is eligible to compete for it — and pay for it — are interrelated issues.”

It’s still too early to tell how the current apparatus is working in terms of giving Canadians more wireless choice, but this spectrum auction could open up some new opportunities for some if the bankroll is big enough. If foreign ownership rules are relaxed significantly, for instance, we could see WIND lap up more spectrum. It’s also possible that we could see other carriers seek funding elsewhere so that they have more of an opportunity at the table.

Stay tuned here for more information in the coming months. I’ll try to break down the rules and procedures behind a spectrum auction, too, so that should be an interesting ride.

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