Telus (TSX:T) and Wind Mobile may soon be getting more attention from B.C. wireless subscribers yearning for faster speeds on their devices.
Results revealed Friday (March 6) from the high-speed AWS-3 wireless spectrum acution show Vancouver-based Telus and Toronto’s Wind came away with all the available blocks in B.C.
Telus paid more than any other carrier in the auction that brought in $2.1 billion. It will pay out more than $1.5 billion for the coveted spectrum across different regions in Canada after outbidding competitors like Bell (TSX:BCE) and Rogers (TSX:RCI).
Wind, meanwhile, will only pay the federal government the minimum bid of $56 million for spectrum in B.C., southern Ontario and Alberta.
Wind and Mobilicity were the only companies that qualified to bid for spectrum set aside by Ottawa for regional carriers.
But Industry Minister James Moore confirmed Friday Mobilicity, which is under creditor protection, did not place any bids.
In 2008, Wind’s parent company paid $442-million for wireless spectrum to launch its network.
“There is certainly a discount on the AWS-3 as a result of it not…being fully deployed today,” Wind Mobile chairman Tony Lacavera told Business In Vancouver.
“We now have to invest another $300-400 million into our network in order to meet those build requirements and actually satisfy Industry Canada that we’re putting that spectrum to competitive use.”
He added he did not want to speculate on Mobilicity’s financial well-being, “but when you look at their circumstances, it’s not just about what you bid in this auction or what you secure spectrum for at $56 million or otherwise, it’s about what do you really need now to invest.”
Lacavera said his company expects to roll out the AWS-3 spectrum within nine months to three years, depending on when manufacturers begin equipping mobile devices with the capacity to work on the spectrum.
After the U.S. federal government held its own auction last month for AWS-3 spectrum, Lacavera said manufacturers now have more impetus to begin rolling out devices compatible with the high-speed spectrum.
“We definitely have a lot of work to do to improve our network (in B.C.), we’re aware of that,” he said.
Telecom analyst Mark Goldberg said the results of the auction — which also saw Quebec’s Videotron and Atlantic Canada’s Bragg Communications purchase blocks of spectrum set aside for smaller carriers — enables the regional providers to become more credible.
“It’s not enough to hang up a shingle and say you offer wireless services. What you have to be able to do in today’s market is offer the latest, fastest-speed wireless service, and the new entrants generally didn’t have enough spectrum to offer LTE service,” he said.
The federal government has been pushing for a fourth major carrier in every market the past few years to create more competition, which is why it set aside blocks of spectrum for smaller players like Wind, Mobilicity, Videotron and Bragg.
Goldberg, who is also the organizer behind the annual Canadian Telecom Summit, said one of the hot topics at last year’s conference was whether more competition comes from creating a fourth major carrier in every market.
“It’s an enormous debate,” he said.
“In Europe we’re seeing consolidation, so where they’ve had four or five players, they’re reducing down to three.”
