Reply Comments to the "Consultation on a Policy, Technical and Licensing Framework for Use of the Bands MHz and MHz"

Transcription

1 Reply Comments to the "Consultation on a Policy, Technical and Licensing Framework for Use of the Bands MHz and MHz" Canada Gazette, Part I Notice SMSE July 22nd, 2014 Submitted By: Ontario Limited mike.dixon@web4wireless.com 1 P a g e

2 July 22nd, 2014 DISCLAIMER Although efforts have been made to ensure the accuracy of current spectrum allocations, assignments, services and applications, the authors cannot warrant the quality, accuracy, or completeness of any information, or data in this document and assume no responsibility for any possible errors or omissions. It is the responsibility of all persons who use this report to independently confirm the accuracy of the data, information, or results obtained through its use. In no event will the Authors, its Directors, Employees, and Agents; or its employees, servants or agents have any obligation to the user for any reason including claims arising from contract or tort, or for loss of revenue or profit, or for indirect, special, incidental or consequential damages arising from the use of this information. This report is being submitted with the intent that it be readily available for personal and public noncommercial use. 2 P a g e

3 Background The Government of Canada has a policy objective to encourage competition for the provision of mobile wireless services in Canada, by attempting to create favourable business conditions for a fourth facilities based carrier to emerge in each region of the country. Previous governments have attempted similar policies, and in the 1990 s both ClearNet and Microcell (Fido) were created to provide such competition as new entrants to the incumbents Bell, TELUS and Rogers. In 2000 a period of consolidation began when ClearNet was purchased by TELUS, and in 2004 Fido was purchased by Rogers Communications. Although these new carriers were absorbed, many of the new innovative services that they developed were adopted by their new owners. Any review of wireless business cases will reveal that to create a facilities-based telecommunication company is capital intensive, and requires that investors continue to invest in a cash flow negative operation for as many years as it takes to reach a critical mass and profitability. In 2008, in support of the fourth carrier strategy, the government arranged the AWS-1 auction and made provision for set aside spectrum that was only available to new entrants and indeed several more wireless operators entered the market. In Western Canada, Shaw Communications purchased spectrum and started to construct a wireless network, while Videotron s strategy was to concentrate on services to the residents of Quebec. Other companies (WIND Mobile, Mobilicity and Eastlink) also bought spectrum and started to build networks. It is unfortunate that none of these companies considered a network sharing business model, where the capital cost of radio sites could be shared and competition on the retail front would be the business focus. The AWS-1 spectrum allocated to the 2008 new entrants could support such a model and the technology to allow this approach was already available in While Shaw Communications soon ended their AWS-1 investments in favour of a wireless strategy involving unlicensed spectrum (Wi-Fi), the other new entrants continued with WIND and Mobilicity deciding to compete in the same five cities with each other (as well as competing with Bell, TELUS and Rogers). Eastlink has chosen to compete in the Maritime provinces. This fragmented business model approach adopted by the new entrants was not a success and yet Industry Canada has suggested that 60% of the additional new spectrum known as AWS-3 will be reserved for a single new entrant in each region, and that a (future) public consultation will soon appear, while the current consultation (SMSE ) appears ready to extend the license for the AWS- 4 spectrum to TerreStar Canada (a DISH subsidiary) without an auction, on the grounds that it is a mobile satellite band although no such services have been provided for over a decade, while AWS-2 has been ignored. This proposed arrangement likely will not create a robust basis for a fourth carrier in each region, since it does not address the business case fundamentals. 3 P a g e

4 Discussion of AWS-4 Industry Canada received thirteen submissions in response to SMSE of which two came from corporations that provide satellite communications systems (TerreStar and OmniSpace) both of which are controlled by US corporations, and the remaining submissions were from interested parties based in Canada. TerreStar and OmniSpace both operate satellites with S-Band capabilities and presumably compete with Irridium, GlobalStar and Orbcomm for global communication services in areas where terrestrial mobile wireless options are limited or non-existent. TerreStar is owned by DISH, which purchased its satellite operations from DBSD North America (previously part of ICO Global) and TerreStar as part of Chapter 11 proceedings. Today DISH operates two satellites (G-1 and T-1) that could provide wireless services using S-Band spectrum. After ICO Global's geostationary-orbiting satellite was sold to Dish Network of Englewood, Colo., for $325 million as part of Dish s purchase of DBSD, what remained of ICO Global was renamed Pendrell. The company has had a medium earth orbiting satellite in operation for over a decade. The spacecraft, built by Boeing, was to have been part of a 12-satellite constellation ringing the Earth to provide broadband communications. The first satellite failed on launch, but the second satellite (ICO F2) was launched in 2001 but the remaining ten satellites were abandoned in various stages of construction. In April 2004, Boeing terminated the ICO contract. The ICO F2 satellite was kept operational, albeit without usage, until March 2012, when the owner decided to passivate and abandon the satellite. Figure 1 Satellite ICO F2 More recently an Australian company (SIRION) has secured initial regulatory approval from the ITU to use 30 megahertz of S-band spectrum for a loworbiting constellation of twoway messaging and machineto-machine (M2M) satellites by bringing into use the desired radio spectrum by a specified deadline. Sirion said this was accomplished by purchasing 30 megahertz of S-band capacity (20 megahertz uplink, 10 4 P a g e

5 megahertz downlink) aboard the ICO F2 satellite once owned by the now-defunct ICO Global Communications with services leased from OmniSpace Corporation on the reactivated F2 satellite. Since the ICO F2 satellite is approaching the end of its life expectancy, it is not clear how new capital will be raised in order to design and launch the ten medium earth orbit satellites needed to fulfill the mission for global M2M and mobile communications that are proposed by OmniSpace and Sirion. Since the FCC in the USA has removed any requirement for the provision of actual satellite services in the S-Band before the planned terrestrial deployment of this spectrum in the US domestic market (as AWS-4), it is unlikely that a sufficient business case will ever exist for any purely Canadian MSS deployments, let alone the development of any dual mode (terrestrial/satellite) handsets for Canadian users. In fact neither of the proponents for a satellite solution for Canada has provided any discussion of the next generation of S-Band satellites that will be required over the next decade. Existing MSS providers (Irridium, Globalstar, Inmarsat etc) seem to be able to provide basic voice and low speed data from existing satellites, without using the S-Band spectrum that is the subject of this consultation so that perhaps this spectrum should be re-deployed for purely terrestrial purposes? Recommendations for AWS-2, AWS-3 and AWS-4 spectrum bands There is an amazing opportunity to make available new spectrum over the next twelve or twenty four months by developing a comprehensive plan for spectrum bands AWS-2, AWS-3 and AWS-4, so that Canadian carriers can provide mobile broadband services that are required by Canadians to support the increasing demand for mobile data capacity in urban areas. Naturally these bands must be co-ordinated with the US market in order to ensure that handset ecosystems are developed. As mentioned earlier the creation of a fourth wireless competitor in all regions of Canada does not require additional spectrum, but rather an examination of the necessary drivers for a successful business model to ensure that competition is sustainable. There is more than enough under utilized AWS-1 spectrum in rural and remote areas where current business models are fragile, and the issue of Canada wide roaming must be addressed. An opportunity exists for the development of an overarching strategy to properly develop all of the remaining AWS spectrum bands, described as follows: The AWS-2 band (or the PCS H-block) which has already been allocated in the USA having been purchased by DISH, yet the announced plans by Industry Canada seem to ignore AWS-2. 5 P a g e

6 Figure 2 AWS-2 the PCS H-Block Additionally the AWS -3 band (scheduled for auction in the USA on November 19th) should be included in this new strategy. Figure 3 AWS-3 band for North America Of course, any new strategy by Industry Canada should also include the AWS-4 band, which is the subject this consultation (SMSE ). 6 P a g e

7 Figure 4 AWS 4 band (also known as S-Band MSS spectrum) Only by developing a comprehensive and coordinated AWS spectrum strategy will Industry Canada raise significant funds for the Canadian taxpayer, and allow carriers to efficiently develop services with these new bands. In the USA some of the funds raised in these spectrum auctions are designated to fund the US Public Safety Broadband Network (called FirstNet), and Industry Canada is encouraged to follow a similar path to ensure that our Public Safety Agencies do not fall too far behind when it comes to mobile broadband. End of Document 7 P a g e