Archived — Notice No. DGTP-002-96

Industry Canada

Radiocommunication Act

Notice No. DGTP-002-96

Policy Discussion Respecting Third Party Cellular Service Provision

Introduction

The purpose of this Notice is to initiate public discussion on a proposal to amend the policy respecting the authorization of cellular service providers operating in the frequency bands of 824-849 MHz and 869-894 MHz, so as to extend the provision of cellular service to unserved and underserved areas in a timely and orderly manner.

Background

Pursuant to Canada Gazette Notice No. DGTN-006-82/DGTR-017-82, dated 15 October 1982 and entitled "Cellular Mobile Radio Policy and Call for Licence Applications", the Department of Communications (as it was then), set out, inter alia, an allocation plan (note 1) and licensing scheme for cellular telephony. For the first of two sub-allocations, the Department invited applications from regulated Canadian telecommunications common carriers to provide cellular mobile radio telephone services within the operating territories where they offered public switched telephone service (i.e., "wireline" telephone companies could obtain a licence to provide cellular services within their operating areas by simply requesting one, conditional, of course, on their otherwise complying with all applicable technical and operational criteria). For the second sub-allocation, the Department indicated that it would accept proposals from other applicants to provide cellular mobile radio telephone services in areas also served by regulated Canadian telecommunications common carriers. In the event, the company now known as Rogers Cantel Inc. was successful in obtaining, through a comparative selection process, authorization to provide nationwide service. The licences provided to the wireline telephone companies and to Rogers Cantel Inc. enabled those firms to utilize spectrum to develop and implement cellular mobile radio services within their respective delineated areas, but, as most recently confirmed in Policy Guideline 8 of the September 1992 Departmental document entitled "A Spectrum Policy Framework for Canada", they did not confer ownership rights in the spectrum within those areas.

This policy for the authorization of cellular service providers was developed at a time when the Canadian cellular industry had not yet come into existence. Today, the industry is a relatively mature one: cellular services are available to about 90% of Canadians, there are over 2.2 million subscribers, cellular infrastructure is available from a number of competing vendors, and the regulatory procedures which enable entities to obtain interconnection rights (and thereby access to the public switched telephone network of a wireline telephone company) have become commonplace and standardized. The cellular industry has been successful in deploying equipment over much larger geographical areas than were originally envisioned by the industry or required as a condition of licensing by the Department, and is currently implementing digital technologies to expand its service offerings; however, there are still a number of smaller and more remote communities throughout Canada to which the cellular service providers have not extended services and to which it is not expected that services will be extended in the near or foreseeable future. Accordingly, the Department has received representations requesting that third parties (i.e., parties affiliated with neither the local wireline telephone company nor Rogers Cantel Inc.) be permitted to provide cellular services in communities where such services are not currently being offered. The introduction of cellular services in previously unserved areas would, of course, permit residents and visitors to access a more complete range of mobile telecommunications services, and could confer potentially important public safety and security benefits. Existing telecommunications service providers would garner the advantages arising from a larger cellular subscriber base, which could include increased long distance and roaming revenues.

The Department, being cognizant of the changing environment for, especially, the mobile telecommunications industry sector, periodically revisits existing policies to ensure that they continue to advance the objectives of the Radiocommunication Act, as well as the objectives set out in Section 7 of the Telecommunications Act, to which the Minister of Industry may also have regard in exercising his or her powers under the Radiocommunication Act. In giving consideration to any proposed amendment to the current policy, particular regard must be had to the objectives of rendering accessible to both rural and urban areas telecommunications services of high quality, of enhancing the efficiency and competitiveness of Canadian telecommunications, and of responding to the economic and social requirements of telecommunications services users.

Proposal for Policy Amendment

The Department proposes to amend the policy set out in the aforementioned 1982 Canada Gazette Notice so as to permit third parties (parties which are not affiliated with either the local wireline telephone company or Rogers Cantel Inc.) to apply for authorization to provide cellular services to communities where competitive cellular service is not being offered at the time the application is made.

The initial view of the Department is that, in order to advance the identified telecommunications policy objectives, the Department should effect an amendment to the current policy so as to provide a framework within which it would entertain bona fide and complete applications from potential third party cellular service providers for unserved geographic areas or areas being served by only one cellular service provider, in those situations where the local wireline telephone company and Rogers Cantel Inc. (or the local wireline telephone company or Rogers Cantel Inc., as the case may be), have received appropriate notification of the intention of that third party to initiate cellular service and have not thereafter undertaken to provide sufficiently comprehensive cellular service, in substantially the entire identified geographic area, within a time period of not longer than one year.

Other wireless services authorized by the Department on a national basis, including Personal Communications Services (PCS), are not the subject of the current Notice, but services such as those provided by a mature PCS industry may constitute relevant elements in an inquiry of this nature, and furthermore, may be the subject of similar future policy initiatives.

Request for Comments

In order to implement an authorization plan that would best meet the objectives of the Department as stated herein, as well as support the general interests of the telecommunications service industry and consumers, the Department is requesting comments on the following issues:

Policy Amendment

1) Would the implementation of third party cellular service authorization meaningfully advance the goal of extending the provision of cellular services to the greatest possible number of Canadians, or could it in some manner impede the long-term development of more effective and efficient cellular service offerings?

2) Should the Department institute criteria under which it would initiate the introduction of third party cellular service provision in an unserved geographic area, or a geographic area being served by only one cellular service provider, or should the Department only proceed to consider the provision of third party cellular service in circumstances where a potential third party cellular service provider has submitted an application to provide service? If the former, what should the criteria include?

3) In either of the scenarios set out in Item 2, what selection process should the Department utilize if there is more than one potential third party cellular service provider?

Eligibility for Entry

4) If there is a potential third party cellular service provider offering to introduce (or provide a second) cellular service in a given geographic area, should it (or the Department) give notice to the wireline telephone company and/or Rogers Cantel Inc. before the application for that service is substantively evaluated by the Department, as mooted in the above proposal? If so, under what conditions, in what form, and how long before the service is to commence? Should any form of response from the wireline telephone company and/or Rogers Cantel Inc. have an impact on the licensing of, or the terms and conditions in the licence of, the third party cellular service provider? Should special circumstances apply if the geographic area proposed to be served by the potential third party cellular service provider is contiguous to a geographic area currently being served by one or two existing cellular service providers?

5) Should there be any ownership/affiliation restrictions (in addition to any subsisting legislative and regulatory Canadian ownership requirements) on the entities that can seek to become third party cellular service providers?

6) Should there be any special provisions applicable to a requested transfer of a licence from a third party cellular service provider?

7) Should any restrictions be imposed on the subsequent entry of one or more additional cellular service providers (which providers may include the local wireline telephone company and Rogers Cantel Inc.) in an area being served by a third party cellular service provider?

Assignment of Frequencies and the Provision of Services

8) If both cellular telephony sub-bands are available, on what basis should the Department make a decision about which of the two sub-bands is to be used by a potential third party cellular service provider?

9) Having regard to the definition of cellular mobile radio service provided in Canada Gazette Notice No. DGTP-009-95, dated August 10, 1995 and entitled "Radio Systems Policies RP-003 and RP-005 Relevant to the Level of Usage of Mobile Systems and also the Definition of a Cellular Mobile Radio Service as Originally Set Out in October, 1982", pursuant to which Industry Canada will place no limitations on the types of mobile radio or personal communications applications in the cellular mobile bands, should applications that seek primarily to provide other than high-mobility voice telephony services be entertained or encouraged?

10) Should applications that propose to use only part of a sub-band (to, for example, primarily provide local loop subscriber services) be entertained or encouraged? Should the Department give consideration to providing authorization for only a part of a sub-band in those situations where the spectrum requirements of the applicant do not appear to warrant authorization of the entire sub-band?

11) What (new or additional) measures would have to be taken to effect frequency coordination by a potential third party cellular service provider with existing and planned stations, to ensure that type approval considerations are satisfied with respect to all radio apparatus, and to ensure that all other technical standards and measures are complied with?

12) Should entities other than telecommunications common carriers (for example, corporations or governmental agencies) be permitted to utilize the frequency bands of interest to provide cellular services to a restricted group of persons (for example, their employees and/or contractors)?

Conditions of Licence

13) Should parties be permitted to offer temporary services through the use of portable cellular systems, in support of, for example, emergency relief efforts, and, if so, should any special provisions be applicable thereto?

14) Should a potential third party cellular service provider have to meet all of the policy requirements applicable to service providers offering analogous types of wireless services, such as, for example, commitments to research and development funding?

15) Should a licence granted to a third party cellular service provider contain any specific conditions additional to, or different from, those of subsisting cellular service licences (including, but not limited to, the terms of service provision)? Does the question of resale assume greater importance if third party cellular service is to be offered in one of the cellular sub-bands?

16) Are there any special circumstances or international considerations associated with roaming to which regard should be had if third party cellular service were to begin in either or both of the cellular sub-bands?

Miscellaneous

17) What other factors should be considered by the Department if the Department proceeds to amend the extant policy?

Public Submissions

Industry Canada invites written submissions from all interested parties on the above issues. Submissions should be addressed to the Director General, Telecommunications Policy Branch, Industry Canada, 300 Slater Street, Ottawa, Ontario, K1A 0C8. To ensure consideration, submissions must be received on or before May 27, 1996. All submissions must cite the Canada Gazette, Part I, the publication date, the title and the Notice reference number.

All submissions received in response to this Notice will be made available, about two weeks after the closing date of this Notice, for viewing by the public during normal business hours at the Industry Canada Library, 365 Laurier Avenue West, Ottawa, Ontario, and at the offices of Industry Canada at Moncton, Montréal, Toronto, Winnipeg and Vancouver, for a period of one year from the close of the comment period.

The document entitled Policy Discussion Respecting Third Party Cellular Service Provision is available electronically via the Internet at the following addresses:

Anonymous file transfer (FTP)
info.ic.gc.ca/pub/ic-data/telecom/gazette

Gopher
info.ic.gc.ca port 70/Industry Canada Documents/telecom/gazette

World Wide Web (WWW)
http://info.ic.gc.ca/ic-data/telecom/telecom-e.html

Copies of the subject document are also available from the Communications Branch:

Industry Canada, 235 Queen Street
Ottawa, Ontario K1A 0H5
613-947-7466

and from the offices of Industry Canada at Moncton, Montréal, Toronto, Winnipeg and Vancouver.

Dated at Ottawa this 14th day of February, 1996.

Michael Helm
Director General
Telecommunications Policy


Endnote

1. The current allocation plan dates to May 1990, at which time the allocation for cellular telephony was expanded to the referenced frequency bands. (return to text)


Last update: February 26, 1996 (jp)
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