Winnipeg Free Press - PRINT EDITION

Bidding underway for new cellphone frequencies

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OTTAWA -- Bidding for a coveted piece of Canada's wireless market started Tuesday.

Experts say the radio spectrum at 700 megahertz up for auction is particularly valuable because they allow cellphone signals to travel longer distances and penetrate buildings and tunnels where calls are often dropped.

The signal also requires fewer cellphone towers to provide coverage in rural areas.

Ten players are in the game, including Canada's big three telecom companies: Bell (TSX:BCE), Rogers (TSX:RCI.B) and Telus (TSX:T).

Among regional bidders are Quebecor's Videotron (TSX:QBR.B) in Quebec, MTS Inc. (TSX:MBT) in Manitoba, Saskatchewan Telecommunications and Bragg Communications, which operates EastLink in Atlantic Canada. But Wind Mobile's parent, Globalive Communications, pulled out Monday due to a lack of funds.

Meanwhile, it's expected to be weeks before Industry Canada discloses who won licences and how much they paid for them.

The previous auction in 2008 for different frequencies raised $4.3 billion and ushered in a host of new players.

But experts say lack of new competition means this auction won't likely raise as much money as expected, even though it's a more valuable piece of spectrum.

Hopes for foreign competitors to shake up the industry were dashed last September when U.S. giant Verizon dropped the idea of expanding into Canada.

The federal Conservatives say they want a fourth national player in every region of the country to give consumers more choice and to help lower fees.

Wind Mobile wanted to fill that slot, but its majority owner, Russian telecom VimpelCom, decided not to fund its participation in the auction.


-- The Canadian Press

Republished from the Winnipeg Free Press print edition January 15, 2014 A11

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