B.C. companies that provide broadband Internet to remote communities are applauding an apparent move by Industry Canada to take back a slice of spectrum that they say they could use to expand wireless broadband Internet coverage in the province.
There are hundreds of remote communities in Canada that still don't have broadband Internet. They are stuck with dial-up and satellite, neither of which typically has the bandwidth needed for many modern applications, such as video streaming.
Industry Minister James Moore recently announced plans to review the licences awarded between 2004 and 2009 for spectrum in the 2300 megahertz and 3500 MHz bands, and warns that telecoms and Internet service providers that received those licences could lose them if they have failed to use the spectrum to deliver wireless broadband Internet services to rural Canada.
Davin Peterson, managing director for Base Technologies, which provides wireless Internet service to remote communities in B.C., hopes the review results in spectrum being taken back and set aside for companies like his.
"I have probably eight communities that we would have an actual business case to go into, if we had that bandwidth," Peterson said. "Right now we're just serving two or three."
The 3500 MHz band was awarded specifically for fixed wireless services that would provide broadband Internet in remote, sparsely populated areas.
Bell (BCE Inc., TSX:BCE) and Rogers Communications Inc. (TSX:RCI) – which acquired the lion's share of that band under a partnership called Inukshuk Wireless Inc. – started work on a rural network deployment, but Moore's announcement suggests it has not been moving fast or far enough.
"These spectrum licences contained conditions requiring that the spectrum be used for fixed wireless access, which represents the most affordable high-speed Internet access for many rural Canadians," Moore said. "Our government will only renew spectrum licences for those holders that have met all conditions of licence. Those that have not used the spectrum will lose it."
"This announcement seems to be a bit of a shot across the bow to some of the incumbents with large spectrum holdings in these bands who haven't deployed," said Chris Allen, president of ABC Communications, a B.C. company that also acquired 3500 MHz spectrum.
"We're confident Inukshuk will satisfy all of Industry Canada's conditions," Jason Laszlo, a Bell spokesman, told BIV in an email.
However, he was unable to provide information on how many rural Canadians Inukshuk has been able to provide fixed wireless Internet service to using the 3500 MHz band.
According to Industry Canada, 75% of licences in the 3500 MHz and 98% in the 2300 MHz band have not been used.
The incumbents have argued that the hardware and standards that can work off the 2300 and 3500 MHz spectrum have problems and they are waiting for better equipment and standards to become available.
That hasn't stopped ABC Communications and Base Technologies from using it. ABC, which acquired 3500 MHz spectrum in 2004, has used it with WiMAX – a communications standard that is perfectly functional for small rural communities, despite having fallen somewhat out of favour in recent years.
"Their argument is that there hasn't been any good equipment, and I would counter that, because we've been using equipment in that band for the last 10 years," Allen said.
WiMAX has been likened to Wi-Fi on steroids. It can be used to beam broadband Internet signals to entire buildings or towns without having to wire each house.
WiMAX has had its problems, however, and is now being largely supplanted by other standards, including LTE, which has sufficient bandwidth to be used either for cellular networks or wireless broadband Internet.
Base Technologies has used WiMAX, as well, but is now switching to other standards and hardware.
"We basically had to abandon WiMAX," said Peterson. "Now we're using what amounts to proprietary technologies by different radio manufacturers."
If Industry Canada does take back spectrum, Peterson said he hopes it is made available to companies like his as a set-aside, because smaller companies like Base Technologies simply can't compete against bigger players in an open auction.
"I hope this band gets reserved for these applications because we have situations where we have a tower which could potentially serve thousands of people, but without a licensed frequency for us to use, we're stuck with very narrow bandwidth," Peterson said.
