Canada raises $7.2 billion in auction of 3.5 GHz frequencies for 5G

Wireless

The government of Canada raised a total of CAD8.9 billion ($7.2 billion) in its auction of 3.5 GHz spectrum, which will be used by local carrier to further expand 5G services in the country.

The spectrum 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

5G licenses in this key band were made available based on 172 localized service areas covering the entire country, allowing bidders to target geographic markets, including rural areas.

The government noted that a total of 23 companies participated in the auction. In total, 1,495 out of 1,504 available licenses were awarded to 15 operators, including 757 licenses to small and regional providers across the country.

The government had reserved up to 50 megahertz of spectrum in the 3.5 GHz band for small and regional providers to enhance competition in the Canadian wireless market. The spectrum acquired by these companies will support the deployment of high-quality wireless services so consumers and businesses across Canada, including those in rural and remote regions, the government said.

Winning bidders have until August 13, 2021, to submit 20% of their total final payment. The remaining 80% is due on October 4, 2021.

“The 3.5 GHz auction is a key step in our government’s plan to promote competition in the telecom sector, improve rural connectivity, and ensure Canadians benefit from 5G technologies and services. As intended, small and regional providers have gained access to significantly more spectrum, meaning that Canadians can expect better wireless services at more competitive prices, which has never been more important for working, online learning and staying connected with loved ones,” said François-Philippe Champagne, minister of innovation, science and industry.

Local operators Rogers, Bell, Telus, Videotron, Xplornet and SaskTel have all secured 5G licenses in the spectrum auction. Preliminary results showed that Bell spent CAD2.1 billion, Rogers CAD3.3 billion and Telus CAD1.9 billion. Vidéotron, owned by Quebecor, spent a total CAD830 million to expand its geographic footprint in Canada, buying licenses not just in Quebec but also in Ontario, Manitoba, Alberta and British Columbia.

Rogers, which secured a total of 325 licenses, said its investment in this new spectrum will allow it to reach 99.4% of Canadians with 5G. “This investment in 5G spectrum will build on our existing 5G assets and enable us to deliver the world-class connectivity Canada needs to increase productivity, fuel innovation, create jobs, and compete in a global economy for decades to come,” said Joe Natale, President and CEO, Rogers Communications in a statement.

Videotron won 294 licenses, Bell received 271, Telus secured 142, while Xplornet received 263 licenses.

Freedom Mobile, the country’s fourth largest cell service provider, had decided not to take part in the auction amid a takeover deal of its parent company Shaw Communications by Rogers that is still awaiting regulatory approval.

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