The House of Commons resumes this week with most political attention
likely to be focused on the upcoming budget. Around the same time as
the budget is tabled, Industry Minister Christian Paradis is expected
to unveil Canada’s much-anticipated spectrum auction policy, a decision
that will define the competitive landscape for telecom and Internet
services for the next decade.
While interest in spectrum auction policy is typically limited to
telecom companies and business analysts, all Canadians have a stake in
this decision. The available spectrum - known as the 700 MHz spectrum -
opens up a host of possibilities for new innovation, competitors, and
open Internet access. It is viewed as particularly valuable spectrum
since it easily penetrates walls, making it ideal for delivering
wireless high-speed Internet services.
Auctioning the spectrum raises a host of critical policy choices.
Topping the list is whether the government tinkers with the auction
framework to help foster greater marketplace competition. Some of the
large incumbents unsurprisingly favour an “open auction” with no
bidding limits, but assuming Paradis concludes that some measures are
needed, the choice will likely come down to either a spectrum set-aside
that reserves some spectrum for new entrants and smaller companies or
spectrum caps.
The last spectrum auction included a set-aside, which opened the door
to a handful of new competitors such as Globalive, PublicMobile, and
Mobilicity. A further set-aside may make sense since this round of new
entrants may look to use the spectrum primarily for wireless broadband
services, providing a potential alternative to the cable and telecom
dominance.
If another set-aside proves too unwieldy, a spectrum cap, which would
limit the amount of spectrum any single company could hold, may emerge
as the alternative. A spectrum cap might prove effective if combined
with two additional conditions.
First, the implementation of a use-it-or-lose it principle that would
require all bidders to use the spectrum within a defined period. The
use-it-or-lose-it approach would help guard against the hoarding of
spectrum, particularly for incumbents who may overbid in the hopes of
keeping new competitors out of the market.
Second, safeguards against opportunistic flipping of the spectrum with
the prohibition on its sale within the first five years of the auction.
The trio of policies - caps, mandatory use, and a block on transfer,
may increase the number of successful bidders.
Another critical issue is who should be entitled to bid for the
spectrum. The last spectrum auction featured Canadian ownership
requirements, thereby limiting potential entrants. Given that Canada is
one of the only developed countries that has retained significant
telecom foreign ownership restrictions, the auction provides a
tailor-made opportunity to eliminate the restrictions by opening the
market to all bidders.
The spectrum policy decision will also determine which spectrum is
available for auction and which is reserved for alternate purposes. The
government has already indicated that it plans to grant some of the
spectrum to law enforcement agencies, which intend to create their own
emergency wireless network.
Many leading technology companies have recommended allocating some of
the spectrum for unlicensed purposes. This spectrum, which would be
free to anyone to use without the need for licence or government
approval, could yield new services and technologies.
Beyond the technical details of the spectrum auction, the final
billion-dollar question is what the government should do with the
auction proceeds. While the $4 billion in proceeds from the last
auction went into general revenues, this auction represents the best –
perhaps only – opportunity to access billions of non-tax dollars for
the digital economy. The money could be used to support broadband
initiatives, digital content creation, and digital skills programs.
Michael Geist holds the Canada
Research Chair in Internet and E-commerce Law at the University of
Ottawa, Faculty of Law. He can reached at mgeist@uottawa.ca or online
at www.michaelgeist.ca.
Last night I appeared
on George Stroumboulopoulos Tonight
with a short "Soapbox" segment to explain mounting concerns over Bill
C-11. The program has posted a video version of my comments on some of
the digital lock issues in the bill and the demands for SOPA-style
amendments.
Akamai has released its latest State
of the Internet Report
and it finds that Canada continues to slide in global broadband
rankings. Last year, the Akamai report was often favoured by those who
took issue with criticisms of Canadian broadband, claiming
it offered "an objective sanity check" on comparative broadband speeds.
If so, even Akamai now finds Canadian broadband declining when compared
to other countries.
Just six months ago, Canada was tied for
9th in average broadband speed. According to the latest
report,
Canada now sits tied with Hungary for 14th behind countries that
include the United Arab Emirates, Romania, the Czech Republic, and
Ireland. On the peak connection speed, Canada ranks 19th in the world.
The data isn't very impressive on the mobile broadband metrics either.
The mobile broadband speed measured carriers around the world including
one Canadian carrier. The Canadian carrier ranked 68th worldwide for
average broadband speed, below carriers in every region of the world.
The CRTC yesterday released
new net neutrality complaints data. The data shows
a significant increase in the number of complaints in the last quarter
of 2011 when compared with the prior two years. I wrote
about the complaints issue in July 2011 based on data obtained under
the Access to Information Act.
Bill C-56, the anti-counterfeiting bill that opens the door the Canadian
implementation of the Anti-Counterfeiting Trade Agreement, has been
referred to the Industry Committee for review. The government imposed
time allocation on the bill to move it to committee. The debate on the bill
yesterday suggested that all parties support the premise of the
legislation, but the opposition wants further study and potential
amendments. Perhaps most troubling was the intervention of the Liberal
party, who are seeking to extend the bill to seizures of in-transit
shipments. In Europe, in-transit shipment seizure provisions have led to
seizures of generic pharmaceuticals, creating a major
access-to-medicines concern.Jun.13/13Comments (0)
Ariel Katz reports that the University of Toronto has notified
Access Copyright that it will not extend the current licence agreement.
It points to a range of factors - the SCC decisions, copyright reform,
and open access among them - to argue that there should be substantial
reductions in the royalty rate. The university is open to negotiating a
new agreement with that in mind. Meanwhile, Western is adopting much the
same position, notifying Access Copyright that it will not be renewing but leaving the door open to a new agreement with reduced fees.Jun.11/13Comments (0)
The Canadian Library Association issued a statement
late last week on the Access Copyright lawsuit filed against York
University, urging it to abandon the lawsuit and pointing to several
legal concerns.May.21/13Comments (0)
The National Post reports
that the Competition Bureau of Canada plans to launch an investigation
into Google Canada. The scope of the investigation is unknown.May.21/13Comments (0)
The Standing Committee on Access to Information, Privacy, and Ethics has released its study on privacy and social media.
The report includes recommendations for new Privacy Commissioner
guidelines. The NDP supplemented those recommendations with nine
additional legislative proposals that include mandatory security breach
disclosure, order making power for the Privacy Commissioner of Canada,
and the inclusion of privacy issues as part of a national digital
economy strategy.Apr.23/13Comments (1)
The federal government has responded
to a question from MP Charlie Angus on privacy and security breaches by
revealing that there have been thousands of breaches over the past
decade. The stunning response acknowledges over 3,000 breaches that have
affected over a million Canadians.Apr.23/13Comments (0)
The debate over the state of wireless competition in Canada continues to rage. Last week, I appeared on CBC's The Current,
as part of a 30 minute segment devoted to the wireless industry. The
issue was also discussed during Question Period at the House of Commons,
with Industry Minister Christian Paradis focusing on competition and consumers:
We want to enhance competition and investment in this country, and
this is why we adopted this policy back in 2008 for the AWS spectrum.
Let me say that the price went down by an average of 11% since then, and
we will continue this way with the 700 megahertz spectrum. We launched
consultation with the industry to make sure that we enhance competition
and provide better choice and better rates for our consumers.
OpenMedia has an interesting post
that takes a close look at the claim that the large Canadian geography
is responsible for high cell phone prices. The post notes that coverage
actually focuses on as little as 20 percent of the country. Apr.22/13Comments (0)
