Opinion: Trudeau and O’Toole prove that treating spectrum speculators with children’s gloves is the Canadian way
We’ve heard it all before.
Our politicians love to speak out loudly about the crackdown on wireless operators who profit by speculating on valuable spectrum licenses. This time, of course, it takes place during a federal election campaign in which party leaders claim to have consumers’ backs.
Liberal Leader Justin Trudeau and Conservative Leader Erin O’Toole, in particular, seem eager to go the extra mile for who plans to wield the bigger stick with the carriers. They are proposing competing “use it or lose it” spectrum policies, ostensibly to force operators to use the wireless licenses they acquire through government auctions. Their dueling proposals aim to address concerns that it is still too easy for industry players to stockpile spectrum and later flip those airwaves fallow at much higher prices.
A specter fight match is exactly what it takes to spice up this snoozefest of an election. But don’t get too excited, fellow telecom nerds – this is not a substantive policy discussion. While the Liberals and Conservatives are committed to stopping speculation on the spectrum, the solutions they offer are, in a nutshell, weak.
Spectrum – the invisible radio waves that carry wireless signals – is a finite public resource and the lifeblood of industry. Canadians cannot live without their smartphones and rely on lawmakers to learn from the mistakes of the past and maximize spectrum use as operators roll out their 5G networks.
“Use it or lose it” is not a new concept. This is why it is disappointing that the Liberals and Conservatives have not taken a stronger stance on the app, even as Canada prepares to auction more valuable airwaves in 2023 and 24.
The Liberals, for example, suggest they will pressure companies to actually expand their networks – as if that hadn’t always been the expectation.
“With this take-it-or-lose-it approach, Canada’s major national carriers will need to accelerate the deployment of wireless and high-speed Internet in rural and northern Canada by gradually reaching the milestones of broadband access. strip by 2025 ”, the The Liberal platform reads. “If these milestones are not met, we will demand the resale of spectrum rights and reallocate that capacity to smaller regional providers. “
This sounds good in theory, but let’s not forget that small regional suppliers may not have the financial means to take over. In fact, Western Canadian cable company Shaw Communications Inc. is selling to Rogers Communications Inc. precisely because it determined that 5G investments would be too expensive to manage alone.
The Conservatives are offering similarly uninspired solutions, partly recycling eight-year-old talking points from former Industry Minister James Moore.
“We will speed up the spectrum auction process to use more spectrum and enforce use-or-loss provisions to ensure spectrum is developed, especially in rural areas of our country.” Mr. O’Toole noted.
If you managed to read his entire quote without falling asleep, congratulations. The specter is a sexy thing, but our political leaders are proving once again that Canada is the country where smart industrial policy is going to die.
It’s a shame that Mr. Trudeau and Mr. O’Toole are so unimaginative. The loopholes in Canada’s wireless policies that allow operators to switch spectrum for huge profits are well documented.
Our parliamentarians cannot afford to treat porters like children’s gloves.
All eyes are now on Quebecor Inc., which secured 294 wireless licenses across the country in the recent 3,500 MHz spectrum auction. The company is committed to breaking the oligopoly in English Canada, but there are many reasons to be skeptical of its renewed national wireless ambitions.
Not only has Quebecor flirted with national expansion twice before, but it has already resold unused spectrum due to shifting business priorities. In 2008, for example, Quebecor purchased a block of advanced wireless services spectrum in Toronto for $ 96.4 million. He then sold those fallow airwaves to Rogers in 2017 for $ 184.2 million, making a profit of $ 87.8 million.
That same year, Quebecor made a profit of $ 243.1 million after selling to Shaw seven 700 MHz and 2500 MHz licenses it had previously acquired in southern Ontario, Alberta and Colombia. -British.
Quebecor President and CEO Pierre Karl Péladeau also raised his eyebrows when he told analysts on August 5 that while his company will continue to invest in building a full 5G network, “we let’s consider that there is no rush to do it ”.
This was a curious comment given that Innovation, Science and Economic Development Canada (ISED) recently boasted that its rules for the 3,500 MHz auction included “the most stringent deployment requirements to date.”
If the Liberals and Conservatives are serious about stopping speculation on the spectrum, they need to adopt policies that have teeth.
For example, more severe financial penalties should be imposed for non-compliance with the Radiocommunication Act. Currently, the maximum penalty for a first offense is $ 10 million and the cap is $ 15 million for a subsequent offense. These paltry sums are hardly dissuasive.
Although ISED publishes information related to financial penalties on its Compliance and Enforcement webpage, there are currently only two notices.
Additionally, ISDE rarely revokes wireless licenses for non-compliance.
No wonder carriers are not afraid of our regulators. They face no consequences for breaking the rules.
Sadly, this federal election is another missed opportunity to stop spectrum speculators in their tracks. Color me without surprise. Lax enforcement is the Canadian way.
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