Canada’s 3.5 GHz spectrum auction raises record US $7.2B

Canada’s 3.5GHz auction ended this week with a total of $7.2 billion (C $8.9B with US $1  = 1.2444 Canadian dollars) in winning bids. Bell Canada (BCE), Rogers Communications and Telus captured roughly 80% of the spectrum offered for sale by Canada’s government.

Out of 1,504 available licenses, 1,495 were awarded to 15 Canadian companies, including 757 licenses to small and regional providers, Innovation Minister Francois-Philippe Champagne said in a statement on Thursday.

The results would boost competition, he added, a reference to Ottawa’s push to open up a market dominated by BCE Inc, Telus Corp, and Rogers Communications Inc, known as the big three.

Canadian consumers have complained of steep wireless bills, which are among the highest in the world, and Prime Minister Justin Trudeau’s Liberal government has asked operators to cut prices by a quarter by 2021.

Preliminary results showed that BCE Inc spent C$2.1 billion, Rogers C$3.3 billion and Telus Corp C$1.9 billion.

The 3500 MHz range frequencies are seen as important to provide 5G wireless services as they carry larger volumes of data over longer distances (than mmWave, for example). Mid-band spectrum also offers faster upload and download speeds and help power everything from smart cities to driverless cars.

Vidéotron, owned by Quebecor Inc, spent C$830 million to expand its geographic footprint in Canada, buying licenses not just in its native Quebec but also in Ontario, Manitoba, Alberta and British Columbia.

The move indicates that Quebecor plans to become a service provider in those areas, said Mark Goldberg, an industry analyst. He noted that the areas where the company did not bid – Saskatchewan and Atlantic Canada – both have preexisting strong fourth competitors to the big three.

“They’re prepared to be the fourth service provider… This is showing pretty close to a billion dollars in investment in spectrum,” Goldberg said.

Vidéotron said in a statement that the investment would help the company to “realize its ambition of boosting healthy competition in telecom beyond the borders of Québec.”

Bell, Rogers and Telus said their investments will help to provide reliable 5G services.

The auction, initially set to take place in June 2020 and delayed due to the COVID-19 pandemic, closed after eight days and 103 rounds of bidding, the government said.

………………………………………………………………………………………

Xona Partners analyst Frank Rayal noted the Canadian auction clocked in at an average of $1.83 per MHz-POP. The per MHz-POP calculation is applied to most spectrum transactions and reflects the number of people covered compared with the amount of spectrum available, though it can be affected by a wide variety of factors.  Rayal said that’s a record price for mid-band spectrum and far higher than the $0.94 per MHz-POP that U.S. operators paid for similar C-band spectrum in the FCC auction earlier this year.

“Underscoring the Bell team’s goal to advance how Canadians connect with each other and the world, acquiring this significant additional 3500MHz spectrum will drive Bell’s ongoing leadership in 5G, a critical component in our multibillion-dollar program to accelerate investment in Canada’s next-generation network infrastructure and services,” Mirko Bibic, president and CEO of BCE and Bell Canada, said in a press release.

References:

https://www.reuters.com/business/media-telecom/canada-raises-72-bln-via-auction-3500-mhz-spectrum-firms-gear-high-speed-2021-07-29/

 

Leave a Reply

Your email address will not be published.

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>

*

 
 

 

Solve : *
7 × 9 =