Innovation Minister sets critical 5G spectrum auction for December 2020

Shruti Shekar
Telecom & Tech Reporter

The spectrum auction for the coveted 3,500MHz band used for 5G is set for December 15, Innovation, Science and Industry (ISI) Minister Navdeep Bains announced Thursday.

During a telephone technical briefing, a senior ISI official said bidders wishing to participate must submit an application to the department by October 13. The auction will follow a clock auction format with multiple rounds of bidding,

The official said there will be 1,506 licences available in the auction that will be spread across the country. For this auction, the country will be split into 172 geographic locations. Not all the areas will have the same amount of spectrum available for auction. 

The sum of all opening bid prices is $558 million. Last year’s 600MHz spectrum auction raised $3.47 billion. 

The ISI official said the new licences available will be considered “flexible use,” which means carriers will be able to decide what services the band will be used for. That could include 5G networks or fixed wireless services, which are often used in rural locations for DSL. 

The department has also decided to implement a “pro-competitive measure” in the form of set-asides. It added that 50MHz will be set aside in markets where there is enough spectrum available.

The official said that 138 out of 172 locations will have 50Mhz set aside. The official said the reason some locations do not have set-asides is that existing licence holders already provide services in those areas. 

“The set aside will provide the opportunity for smaller and regional competitors - competitors that have been shown to put downward pressure on prices - to acquire the spectrum they need to compete in the market for 5G services,” it said. 

In general, 5G operates over traditional and new cell radio frequency bands that include the low- (sub-1GHz such as 700MHz), mid- (1.6GHz, around 3.5-3.8GHz), and millimetre-wave (mmWave, such as 28GHz) ranges. 

The 3,500MHz band is critical specifically in cities where thousands of small cells will be deployed; the band is also critical for applications like self-driving cars and many consumer applications.

Other carriers already have existing 3,500MHz for rural coverage

As of now, Bell and Rogers, in a partnership called “Inukshuk,” have 76 per cent of the available band. New Brunswick-based rural internet provider Xplornet also holds a large portion of the band.

These existing licence holders have licences for fixed services, which means the carriers use airways to offer internet services, the official said. They added that they will be able to reapply for the new licences that are considered for “flexible” use.  

The official also noted that there will be a transition period for Inukshuk and Xplornet that will allow them to function until after the auction.  

The official said that once the auction is over the carriers have specific timelines to deploy the spectrum, which are between five and 20 years.