Wireless auction

It might be a month before the dust settles and we know what happened, but Tuesday some new Canadian airwaves went on the auction block for cell phone providers. The new frequencies likely won’t help lower your cell phone bill. But you could be able to take a call the next time you’re in a tunnel.

We won’t need as many cell phone towers once wireless carriers start using the new range of radio frequencies. A range abandoned by TV stations which now transmit digitally. The federal government hoped the auction of those frequencies would increase competition, and lower bills for consumers. But then, Wind Mobile backed out, leaving Bell, Rogers and Telus which can each bid on one of four blocks of frequencies. Seven other local carriers may get together to buy the last block.

Marvin Ryder is with the DeGroote School of Business: “I don’t think we’re going to see more competition and lower prices but possibly better service because this 700 mhz block is a longer wave, better able to get into basements, tunnels, places where it’s been difficult to get a signal.”
More than half of Canadians have smart phones now. So the added bandwidth is needed.

Marvin said: “The volume is up, also the data, downloading music and video. You need more bandwidth, more spectrum that way. This will free up capacity, some better service, but probably not better prices.”

The last auction was five years ago and brought in 4.3 billion. This one will probably bring in just $2 billion to federal coffers. Last time there was more competition. Now Wind might be up for sale, Telus bought Public Mobile and Mobilicity is in financial trouble. Ryder says we need another big player in our market for competition to make a difference on our bills. Someone like Verizon or Vodaphone.