Foreign investment restrictions lifted for smaller players in wireless auction

The Conservative government moved Wednesday to level the wireless playing field by placing limits on the coming wireless spectrum auction and lifting foreign-investment limits on small telecom firms.

Industry Minister Christian Paradis says the new measures will allow new wireless carriers into the market and foster greater competition in the telecom industry.

“The measures I am outlining today will ensure the timely availability of world-class wireless services at low prices for Canadian families, including those in rural areas,” Paradis said in a statement.

The government is also applying measures to the 700-MHz wireless spectrum auction to ensure rural Canadians receive the same level of service as people who live in bigger towns and cities.

Companies that hold more than one block of spectrum will have to provide wireless services to 90 per cent of their coverage areas within five years, and to 97 per cent of their coverage areas within seven years.

Antenna tower-sharing and roaming policies will also be changed, and a certain portion of the spectrum will also be set aside for public-safety services such as firefighters and police.

The caps will limit how much spectrum each company can bid for. The changes to the auction rules will let at least four companies obtain spectrum in each of Canada’s 14 licence areas.

As well, companies with less than 10 per cent of the telecom market will no longer have restrictions on foreign investment.

The combined market share of all the new entrants is about four per cent, according to Industry Canada officials.

Wind Mobile and Public Mobile — two of Canada’s smallest cellphone companies — had threatened to sit out spectrum auction if space wasn’t set aside for smaller players like themselves.

The new spectrum up for auction has the ability to allow cellphone calls in elevators, deep in underground parking lots in big cities and in basements and attics in suburban areas.

The frequencies, made available by the switch to digital television signals, also provide better and more affordable coverage in rural Canada because fewer cellphone towers are needed to provide coverage.

In 2008, the federal government set aside radio spectrum for newcomers opening up Canada’s cellphone industry to more competition and raising more than $4 billion for federal coffers.

The auction saw the debut of Wind Mobile, Public Mobile, Mobilicity and Quebec-based Videotron all launch into the cellphone market.

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