Policy and Licensing Procedures for the Auction of Spectrum Licences in the 2300 MHz and 3500 MHz Bands
10. Amendments and Supplements and Clarification Questions to the Policy and Licensing Procedures for the Auction of Spectrum Licences in the 2300 MHz and 3500 MHz Bands
In accordance with Section 7.7 of the Policy and Licensing Procedures for the Auction of Spectrum Licences in the 2300 MHz and 3500 MHz Bands (the Policy), the following clarifies and amends the Policy issued on September 20, 2003. These amendments and supplements also include the Department's response to the clarification questions which were submitted prior to the October 17, 2003 deadline.
For convenience, these amendments and supplements have been formatted so to be considered as Section 10 of the Policy. The text has been organized around the following themes:
- Definition of licences
- Incumbents, transition policy and technical considerations
- Licence conditions
- Licensing process
- Auction design and rules
- Post-auction procedures
10.1.1 Response to Clarification Question Related to Auction Proceeds
Does the Department have any plans to use the auction proceeds to fund, in whole or in part, specific public capabilities that licensees may be required to implement, such as lawful access, or other services that may not necessarily be implemented for commercial purposes?
All auction proceeds are transferred to the Finance Department for deposit into the Consolidated Revenue Fund. The Minister of Finance, under guidance from the federal cabinet, is responsible for the management of the Consolidated Revenue Fund.
10.1.2 Response to Clarification Question Related to the Department's Plans for Releasing Additional Spectrum
Can the Department clarify its plans for releasing additional spectrum?
In the Framework for Spectrum Auctions in Canada, the Department indicated that it would provide a forecast of certain types of spectrum to be released and the timing for initiating future competitive licensing. The Department provides its forecast in Radio Systems Policy-20, Guidelines on the Licensing Process and Spectrum Release Plan (2001 Edition) (RP-20). The forecast is updated to reflect changes in spectrum policies, demand for certain bands and the public interest as new information is available. In RP-20, spectrum resources are grouped as follows: narrowband/wideband wireless access; broadband wireless access, satellite orbital positions, mobile and licence-exempt.
The 2300/3500 MHz spectrum is defined as narrowband/wideband wireless spectrum (below 10 GHz) while spectrum above 10 GHz is generally referred to as broadband.
As described in RP-20, the Department is planning various licensing activities in the mobile area such as the licensing of spectrum for Advanced Wireless Services which includes fixed wireless components of IMT-2000 also known as 3G.
Also, in RP-20 the Department indicated that it announced in November 2001, that it is adding the fixed and mobile allocations throughout the 2500-2690 MHz band and that it would consult on licensing considerations arising from the change in allocations. Since that time, the Department sent a letter to the CRTC on June 20, 2003 imposing a moratorium on the release of MDS spectrum for areas of the country where MDS broadcasting licences have not been issued. The Department intends to carry out a public consultation within the next 18 to 24 months. MDS broadcasting licences have not been issued in several areas of Canada, including the province of Alberta, the Atlantic provinces and many areas of northern Canada.
Other than indicated above, the Department does not have specific plans for releasing additional spectrum for narrowband wireless access below 10 GHz in the immediate future.
10.2 Definition of Licences
10.2.1 Responses to Clarification Questions Related to FWA and WCS Spectrum in General
Advise whether Mobile Aeronautical Telemetry Services (MATS) will be permitted in the WCS Band.
The Department wishes to clarify that WCS will be licensed under the frequency allocations for fixed and mobile services. While aeronautical mobile service and maritime mobile service are defined as part of the mobile service, these services are not included in the permitted services under the WCS licence. Provision has been made to retain the designation for the use of the Mobile Aeronautical Telemetry Service (MATS) in the band 2300-2360 MHz on a secondary basis (no interference, no protection) in Section 5.1.2 of the Policy, footnote C17 of Appendix 2, and Spectrum Utilization Policy SP 2285 MHz. "Where MATS does not impact the implementation of WCS and other services, it may be authorized to the Department of National Defence, on a secondary basis, on major military bases and vicinities, in the band 2300–2360 MHz." The band 2360–2400 MHz is designated for mobile aeronautical telemetry services with priority of use given to the Government of Canada. (see SP 2285 MHz)
Will the Department allow licence-exempt low-powered devices in the WCS and FWA Bands?
The Department will continue to accommodate low power licence-exempt equipment in these bands according to RSS-210 procedures and technical guidelines. This could include new wideband systems such as UWB which operate at levels close to the noise floor.
Advise whether point to point transport service applications will be permitted in the FWA Band.
As stated in Section 4.1.2 of the Policy, licensees may deploy a full range of fixed applications (i.e. point-to-multipoint or point-to-point) in support of FWA applications. This could include point-to-point transport service applications, however, the Department anticipates that the FWA spectrum will be deployed predominantly for point-to-multipoint configurations.
As outlined in the transition policy for displacement in Appendix 3 of the Policy, the intent of displacing incumbent point-to-point systems is to allow for the establishment of new FWA systems, with the anticipation that these would be point-to-multipoint systems. Requests that would require the displacement of existing point-to-point systems, in order to allow the licensee to establish point-to-point systems would be scrutinized by the Department. As well, point-to-point systems deployed under the FWA licence will need to meet the coordination requirements with respect to adjacent areas.
The policy paper states that the Department expects broadband services and that the maximum flexibility will be afforded to successful bidders in terms of the services they will offer. Will the Department confirm that telephony services will be permitted in these bands?
Telephony services will be permitted in both the FWA and WCS bands in accordance with the policy provisions for each band (Particularly Sections 4.1.1 and 5.3.1 for WCS, and Sections 4.1.2 and 5.4.1 for FWA). However, please refer to Section 5.2.4 in the Policy regarding additional restrictions, on FWA systems, in the provision of critical services (such as 911) in the Halifax, Dartmouth, Vancouver and nearby coastal areas and communities along the Strait of Georgia.
What are the license terms, conditions and fees applicable to spectrum in these bands provided through the current FCFS process?
Currently, only FWA is available on a FCFS basis and only in high-cost service areas.
Under the current FCFS process for FWA systems, the licensee must be deemed eligible to become a radiocommunication carrier and comply with the eligibility criteria as set out in section 10 of the Radiocommunication Regulations and in the Canadian Telecommunications Common Carrier Ownership and Control Regulations of the Telecommunications Act. The areas of operation in the existing 1998 spectrum policy generally are limited to high-cost service areas. Licences issued under the FCFS policy have one-year terms and are renewed on an on-going basis. Licence fees are proportional to the geographic area being licensed, that is, for each 25 Km² grid cell, an annual fee of $60.00 for each 25 MHz block in the 3400–3650 MHz band is applied. FWA systems need to be brought into service within a period of six months from receipt of an approval-in-principle/licence.
For greater detail on licence terms, conditions and fees please see the Spectrum Policy and Licensing Provisions for Fixed Wireless Access Systems in Rural Areas in the Frequency Range 3400–3700 MHz, DGTP-013-98 (http://www.ic.gc.ca/eic/site/smt-gst.nsf/vwapj/sp3400.pdf/$FILE/sp3400.pdf) and the two Gazette Notices subsequently published (DGTP-002-03 and DGTP-006-03) which announce rearrangements of the spectrum in the band 3400-3650 MHz to better accommodate FWA systems and radiolocation operations.
The 1998 FWA FCFS policy states that licensees will be provided with discrete channels within shared blocks. Please advise whether the entire blocks will be licensed to individual licensees or whether the blocks will be shared.
For FCFS FWA spectrum, please note that licences are now being assigned for full paired blocks (25+25 MHz) on a non-shared basis.
The FWA spectrum licensed during this auction process, as well as any FWA spectrum assigned in a post-auction licensing process, will not require that licensees share the licence blocks.
10.2.2 Responses to Clarification Questions Related to Exchange of Licences in FWA
In the event that one or more licences in the 3500 MHz band is unsold, would it be possible for the winner of one of the other licences in that band to swap their own licence with one held by Industry Canada, in accordance with the FCFS procedures, without penalty?
The Department would be favourably disposed to requests for any post-auction spectrum transfers of licence(s) won in the auction with any of the unsold licence(s), so as to rationalize the holdings of a licensee for the improvement of spectral efficiency.
10.2.3 Responses to Clarification Questions Related to Geography
Please identify the areas not included in the auction and the reason why they are not included.
In reference to Section 4.3 of the Policy, licences covering all of Canada will be auctioned in the WCS band except for areas and spectrum used by incumbent point-to-multipoint systems identified in Appendix 9 of the Policy. In the FWA band, the areas to be auctioned will include all of Canada except:
- Vancouver Island (Tiers 4-153, 4-154, and 4-155), due to the increased potential for interference in that area, and;
- Spectrum grid cells occupied by incumbent FWA systems in rural areas. A complete list of incumbents and their licence areas, including approvals in principle, will be posted on the Spectrum Management and Telecommunications Web site three to four weeks prior to the auction. Note that the unlicensed portions of Tier areas containing incumbent licensees will still be available at auction.
"It should be noted that spectrum in the band 3475–3650 MHz is currently available on a first come first served (FCFS) basis in rural and remote areas…" (Section 3.4)
- Indicate whether any of the areas classified as "rural & remote areas" overlap the Tier 4 areas identified in Appendix 7.
- Indicate whether any of the Tier 4 areas identified in Appendix 7 are currently available through the FCFS process. If so, identify the bands and locations.
As outlined in DGTP-013-98, Spectrum Policy and Licensing Provisions for Fixed Wireless Access Systems in Rural Areas in the Frequency Range 3400–3700 MHz (http://www.ic.gc.ca/eic/site/smt-gst.nsf/eng/sf01625.html), FWA systems may generally be licensed in high cost serving areas.
The FWA spectrum currently available on a FCFS basis in rural and remote areas, is only available by grid cell, not by the Tier 4 service areas. A spectrum grid cell is a six-sided figure with an area of 25 Km² (see Service Areas for Competitive Licensing at http://www.ic.gc.ca/eic/site/smt-gst.nsf/eng/h_sf01627.html). A grid cell or grid cells in rural and remote areas may partially cover a Tier 4 area and in some cases may even fully cover a Tier 4 area. However, it is never the case that a grid cell covers parts of two Tier 4 areas. Annex 1 of DGTP-013-98, Spectrum Policy and Licensing Provisions for Fixed Wireless Access Systems in Rural Areas in the Frequency Range 3400–3700 MHz provides a full description of FWA spectrum available on a FCFS basis.
During the auction process, the WCS and FWA spectrum blocks will be available for licensing using the Tier 4 service areas as shown on the Spectrum Management and Telecommunications Web site at http://www.ic.gc.ca/eic/site/smt-gst.nsf/eng/sf05909.html. The Tier 4 areas cover all of Canada and thus encompass all existing FCFS licence areas.
The existing FCFS process is only for FWA spectrum in rural/high cost low teledensity serving areas. Annex 1 of the FWA FCFS policy issued in 1998 lists the (then current) applicable areas. Please provide a more recent/up to date list of the applicable serving areas.
The 1998 FWA FCFS policy lists the most current service areas available for licensing.
10.3 Incumbents, Transition Policy and Technical Considerations
10.3.1 Approvals-in-principal in the FWA Band
For the purpose of the 2300 MHz and 3500 MHz auction only, those entities having received written approvals-in-principle will be treated as incumbent FWA licensees and are not subject to the transition policy. Such entities are still obligated to meet the FCFS conditions. For example, in the case of approvals-in-principle, if the six month implementation requirement is not respected these entities will not be granted licences or become incumbent licensees.
10.3.2 Responses to Clarification Questions Related to Incumbents in the FWA and WCS Bands
"A significant and/or unjustified delay in the use of released frequency spectrum by WCS and FWA licensees, after the displacement date, will be viewed by Industry Canada as a serious breach of commitment, particularly if fixed stations were displaced prematurely." (Reference Appendix 3, Item 9.)
How will these licensees be penalized for
- not using the spectrum, and
- having displaced incumbent systems?
Will they be required to pay the cost of the displacement?
The Department will serve notification for displacement to open spectrum for new systems and services as required. It also recognizes that factors affecting the use of released spectrum may occur. The Department will take relevant factors into consideration before determining what action it would take. The Department wishes to discourage unjustified delays in the use of released spectrum.
Spectrum is a public resource which should be used in ways that serve the public interest.
"A list of these FWA incumbent licenses will be made available in advance of the auction so that bidders will know which licenses are encumbered, and the location of the incumbents within the service area." (Reference Section 4.1.3.)
Please indicate precisely how far in advance of the start of the auction this information will be available.
Information on spectrum licence holders, including both FWA and WCS incumbents, continues to be available by searching on the Department's Assignment and Licensing System (ALS) database, on the Spectrum Direct Web site, at http://sd.ic.gc.ca. The Department also plans to provide alternate methods of viewing the FWA and WCS incumbents, in the form of maps. As stated in Section 5.2.1 of the Policy, a complete list of incumbents, including approvals in principle, will be posted on the Spectrum Management and Telecommunications Web site three to four weeks prior to the auction.
10.3.3 Responses to Clarification Questions Related to the Transition Policy of the FWA and WCS bands
"Industry Canada will monitor the effectiveness of the spectrum policy provisions related to the displacement of fixed systems. In the long term, changes to these provisions and/or licence conditions may be made to ensure that the continued availability of spectrum for WCS and FWA systems is accomplished in the most efficient manner."
If and when Industry Canada changes the provisions and/or license conditions, will they first conduct a public consultation regarding these changes? (Reference Appendix 3 Item 10)
The Minister, under section 5(1)(b) of the Radiocommunication Act, has the power to amend the terms and conditions of spectrum licences.
When considering such changes to spectrum policy provisions or licence conditions, the Minister will exercise his/her discretion in determining whether a consultation is necessary.
10.3.4 Responses to Clarification Questions Related to Technical Considerations of the FWA and WCS bands
What measures will the Department put into place to ensure that the successful bidders in WCS enjoy unfettered use of the WCS spectrum, for which they have paid and not be interfered with by S-DARS?
As noted in Section 5.3.2 of the Policy, the Department expects applicants bidding for WCS spectrum licences to take into account the potential operation of digital satellite radio terrestrial repeaters in the band 2320–2345, as well as other services in spectrum above 2360 MHz and below 2305 MHz.
The Department has outlined a series of technical parameters including in-band and out-of-band emission levels which will create an environment within which WCS will operate. The Department has made its best effort to characterize the environment of the WCS spectrum, including the consideration of services in adjacent spectrum, but does not purport to have identified all potential interference situations or their potential impact on WCS. The extent to which this environment constrains a specific implementation of WCS, will depend on a number of factors including equipment characteristics and deployment strategy. It is the responsibility of the applicants bidding for WCS spectrum licenses to assess the implications of the spectrum environment on their business case.
In addition to the above, the use of the WCS spectrum will be subject to the sharing conditions among WCS licensees in adjacent service areas. These licensees are encouraged to enter into mutually beneficial coordination arrangements.
A new SRSP-302.3 will prescribe a coordination procedure between WCS licensees. Such a procedure will contain many of the elements of the cross border WCS coordination arrangement with the US (see Section 5.3.2).
Please confirm our understanding, pursuant to section 5.3.1 of the Policy, that applications of the 2300 MHz band, by winning bidders, will be restricted to low mobility or portable terminals?
Winning bidders in the 2300 MHz frequency band will be licensed under fixed and mobile services, thus deployments may have elements of both services. Licensees may deploy a full range of terminal devices which operate in accordance with the technical provisions to be developed in RSS-195. The technical limits are intended, in part, to facilitate the operation of services in adjacent bands. It has been recognized that with the current state of technology, these rules would severely limit if not preclude most mobile uses, particularly wide area high mobility services such as those currently provided in the cellular and PCS bands. However, it is noted that more relaxed out-of-band emission limits have been adopted in the US for portable WCS terminals which due to their operating characteristics do not increase the interference environment for services in adjacent bands. Similar limits can be adopted in Canada, and will be considered in the development of RSS-195.
The Department states that both fixed and mobile services will be permitted in the 2.3 GHz band and that technical restrictions will be placed on mobile systems to ensure compatibility with systems operating in adjacent bands. Will the potential future removal of any such restrictions on mobile services be possible without the completion of a public consultation? Please explain the process that will take place.
The Department recognizes that changes, such as evolution in the use of adjacent bands, international allocations or technological advances, could result in changes to the restrictions that are required on the use of the WCS band.
The Department does review technical requirements from time to time in consultation with affected parties as appropriate (see response to question 17), however, a public consultation may be conducted if the Department considers it to be in the public interest.
For the purposes of question 18 above and for the purposes of section 5.3.1 of the Policy, what is the definition of "low mobility or portable terminals" which will be applied by the Department?
Winning bidders wishing to deploy mobile services in the 2300 MHz frequency band must conform to the technical limits which will be included in RSS-195. These rules define the technical restrictions on mobile and portable devices and will make the provision of high mobility cellular and PCS services quite difficult (see response to question 17).
At page 19 of Policy and Licensing Procedures for the Auction of Spectrum Licences in the 2300 MHz and 3500 MHz Bands (DGRB-003-03), the Department states as follows:
The Department anticipates that satellite radio service in Canada would require S-DARS terrestrial repeaters to operate with power levels up to 12.5 kW e.i.r.p. (41 dBW e.i.r.p.), but typically at lower power levels.
Please confirm that this power level is measured over the same 1 MHz bandwidth as the S-DARS OOB [out-of-band] emission level.
This value is the total effective isotropic radiated power from an S-DARS terrestrial repeater station. It is measured over the entire transmitted bandwidth of that station, not over 1 MHz bandwidth.
At page 18 of DGRB-003-03, the Department states as follows:
Canadian WCS licensees are advised to consider employing base station receivers with adequate front-end RF filtering to facilitate compatibility with potential S-DARS terrestrial repeater operation in adjacent band. Note that any such design constraint would be limited to the urban environment where S-DARS terrestrial repeaters would be implemented.
- Please confirm that these statements should not be interpreted by WCS licensees to mean that the operations of S-DARS providers will be limited soley to urban environments.
- In certain non-urban environments, S-DARS terrestrial repeaters will be required where satellite signal blockage continues to present a concern (e.g., transportation corridors and commuter routes). With reference to the paragraph above, please explain whether procedures will be adopted in order to ensure that adequate WCS design constraints are implemented by WCS licensees in order to facilitate compatibility with S-DARS terrestrial repeaters in non-urban environments.
The above statement should be interpreted to mean that the operation of S-DARS terrestrial repeaters are needed essentially to improve service in urban areas. Any resulting design consideration for WCS receivers would therefore be limited to the urban environment where provisions for S-DARS terrestrial repeaters are being made.
In the case of terrestrial repeaters located outside of urban areas, the satellite radio licensee is required to seek an arrangement with the WCS licensee(s) that may be impacted.
It should be noted that S-DARS terrestrial repeaters operate in their own band, as does WCS. In situations where the repeater is designed, situated and operated at sufficiently low power so as not to adversely affect existing and future WCS implementations, the Department will permit these applications as required.
Potential WCS licensees are advised to carefully study the U.S. regulatory and operational environment with regard to WCS and S-DARS terrestrial repeater implementations.
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