Archived—Multipoint Communications Systems in the 2500 MHz Range (MCS) — Policy and Licensing Procedures

4.5 Spectrum Licences

Spectrum licences, also referred to as block area licences, provide for the utilization by licensees of specified radio frequencies within a defined geographic area. Since site-specific radio station licences are not required, this type of licence benefits both the Department and licensees by reducing the administrative burden associated with licensing each radio apparatus. Respondents generally supported this approach.

Successful applicants are reminded that they must still obtain all other appropriate approvals associated with individual sites, as well as abide by relevant Industry Canada policies such as shared use of advantageous antenna sites. The licensees will also have the responsibility to ensure that their networks are properly planned and will be required to abide by the geography and frequency privileges attributed to the licence.

4.5.1 Fees

In the Consultation Document, the Department proposed an annual authorization fee for MCS at 2500 MHz of $0.008 per household in each service area, per 6 MHz of spectrum; comments received supported this proposal. As the spectrum will be licensed in one 96 MHz parcel, it is proposed to set the fee equivalently but on a 1 MHz basis per 1000 households, rounded off to the nearest 500 households. This results in a fee of $1.30/MHz/1000 households. For the two additional bands (2150-2156 MHz and 2686-2688 MHz), it is proposed to use the same fee (per 1000 households/MHz) as that used for the main band.

Fees will be calculated for the entire licensed area and band, regardless of the portion actually in use. The applicable fees per service area include all spectrum designated for MCS (2500-2596 MHz, 2150-2156 MHz and 2686-2688 MHz).

A table showing the respective licence fees for the proposed service areas is included in Appendix A. Applicants should note that these licence fees are pro-rated for the fiscal year (April 1 to March 31) based on the proportion of the fiscal year which remains at the time of initial licence issuance. Annual fees are due before March 31 for the subsequent year commencing on April 1. These fees may be revised from time to time as more recent census data becomes available.

Incumbent MCS licensees will be subject to the existing radio station licence fees in accordance with the Radiocommunication Regulations. As outlined in section 4.6, should an incumbent licensee be successful in the comparative licensing process, a new spectrum licence will be issued, and the existing radio licences within the service area will be revoked. In these situations, carry-over of licence fees from the radio licence to the new spectrum licence is not permitted.

On a related matter, as it is the policy of Industry Canada to permit the use of Digital Radio Broadcasting (DRB) installations to provide non-broadcasting services in accordance with an authorization issued under the Radiocommunication Act, the Department is instituting a similar approach for MDS. As a result, where MDS licensees operating in the band 2596-2686 MHz wish to use portions of their licensed broadcasting spectrum to provide radiocommunication (non-broadcasting) services, Industry Canada may issue spectrum licences to eligible operators using the licence fees applicable to these types of radiocommunication services. Spectrum licences will also be issued for MDS licensees wishing to gain access to the new designated spectrum at 2156-2160 MHz and 2688-2690 MHz. Fees for such spectrum licences will be calculated in accordance with those proposed for MCS systems in this policy based on the authorized MDS service areas and the total amount of spectrum used for non-broadcasting services, rounded to the highest MHz.

Comments are sought on these proposals for the bands 2150-2160 MHz, 2686-2690 MHz and for non -broadcasting services in the band 2596-2686 MHz. Comments should be received by the Department no later than July 9, 1999. The Minister will then fix fees under the authority conferred to him by the Department of Industry Act in consideration of the comments received.

top of page

4.5.2 Aggregation/Transfer of Licences

A liberal approach to licence aggregation and licence transfer was proposed in the Consultation Document, and favourable comments were received. Hence, recognizing that parties may wish to offer services in more than one service area, there will be no limits imposed on the number of licences for which a given entity may apply. Applicants or their affiliates may apply for several service areas, but must submit applications for each area on a standalone basis.

Further, other parties may wish to utilize subsets of spectrum within a service area or a subset of the service area. In order to accommodate these situations, parties are encouraged to enter into partnership or franchise-like arrangements either prior to or after licensing. Licensees can also apply to the Minister requesting the transfer of a licence through partitioning or disaggregation of a licence.

Any transfer, partitioning or disaggregation of a licence will require prior Ministerial approval and will be considered according to the following guidelines:

  1. All requests must be made jointly in writing by the original licensee(s) and the new eligible entity(ies) (see section 4.4 concerning eligibility) and must include provisions ensuring that the commitments made by the original licensee(s) will be completely adhered to or will be exceeded by the new entity(ies) commensurate with the scope of the privilege to be transferred.
  2. The partitioning of a licence will only be permitted along census subdivision lines so that the spectrum licence fee can be recalculated commensurate with the number of households in each resulting licensed area.
  3. The disaggregation of a licence will only be permitted in multiples of 1 MHz blocks.
  4. Potential partitioning or disaggregation proposal will result in more complex technical co-existence issues that must be addressed in the submission to the Minister. Such issues include adjacent area/co-channel coordination and international coordination.

For licence transfer, partitioning or disaggregation to take place, the original licensee will be required to return the licence to the Minister once preliminary approval has been granted in order that the Minister may revoke that licence and issue one or more new spectrum licences in its place.

4.5.3 Conditions of Licence

Elements of government policy directly applicable to MCS at 2500 MHz, as well as those applicable to spectrum licences in general, will be made conditions of licence. While most comments on the proposed conditions enumerated in the Consultation Document were generally favourable, Industry Canada notes the following changes.

With respect to the proposed condition regarding lawful intercept of telecommunications by law enforcement agencies, certain comments suggested that the Department forbear from the application of this condition, until such time as it is technically feasible. Further, in the Department's consultation concerning the licensing of 24 GHz and 38 GHz spectrum (DGRB-003-98) a number of respondents made comments to the effect that the "Solicitor General's Enforcement Standards for Lawful Interception of Telecommunications" were written to apply to circuit-switched voice telephony systems and as such the standards were not readily applicable to other telecommunications systems.

The Department is concerned that radiocommunications carriers transporting aggregated traffic, which may be the case with MCS, may have no ability to discern what, if any, intercept target traffic may be present in the aggregate stream. Further, we note that telecommunications networks are moving rapidly away from a circuit-switched environment to a packet-based environment using routers rather than traditional switches. Router-based networks pose a number of challenges to the provision of lawful interception capabilities in that routers may only receive a portion of a target's traffic, a target's traffic may be simultaneously routed through several routers at different points in a network, and routers permit customers to distribute traffic across several service providers.

Notwithstanding the technical complexities involved, Industry Canada recognizes that electronic interception of personal communications under lawful warrant is an indispensable technique for law enforcement. However, recognizing as well that the technical and legal requirements to support lawful intercept capabilities in new network technologies and topologies are still undefined and under development, the Department will not incorporate compliance with the Solicitor General's current standard into a licence condition at this time. Applicants are nonetheless strongly advised to note that compliance with a requirement to provide lawful intercept capability may be imposed via licence condition or other legislative provision at any point in time in the future.

As well, in the Consultation Document, the Department proposed certain conditions, relating to resale and Research and Development. Some respondents questioned the applicability of these conditions for MCS. As a result of these comments and the impact of the new learning aspect included in this policy and licensing process, neither of these conditions will be mandated for MCS at 2500 MHz.

As a result, licence conditions for MCS at 2500 MHz may include requirements that licensees:

  1. substantially adhere to the system rollout plans, Learning Plan and commitments made in their submissions;
  2. file a detailed annual report outlining progress made in all areas for the first five years, augmented with semi-annual interim reports indicating system implementation progress for the first two years;
  3. comply on an ongoing basis with the Canadian ownership and control eligibility criteria as set out in section 10 of the Radiocommunication Regulations, as applicable; Licensees must notify the Minister of any change which would have a material effect on their ownership or control in fact. Such notification must be made in advance for any of the proposed transactions within the licensee's knowledge;
  4. ensure that radio installations are installed and operated in a manner that complies with Health Canada's limits of exposure to radio fields;
  5. mark antenna structures, where applicable, in accordance with the recommendations of Transport Canada;
  6. consult with the appropriate land use authority prior to the installation of significant antenna structures;
  7. comply with technical sharing and international coordination standards and agreements;
  8. make available to the Department, upon request, required technical details of hub stations in the format prescribed by the Department;
  9. obtain Ministerial approval for any proposed licence transfer; and
  10. pay the annual licence fee before March 31 of each year for the subsequent year (April 1 to March 31).
top of page

4.6 Incumbent Licensees

In the responses to our Consultation Document, the Department received extensive comments addressing the situation of incumbent licensees. Notably, many respondents focused on the successful implementation of learning systems in Manitoba, as well as on the difficulty to adapt to what was viewed as too short of a protection period.

Industry Canada concurs with many of the views of the respondents concerning the treatment of incumbent licensees, and is instituting the policy measures below for the 2500-2596 MHz band, with special provisions for the province of Manitoba being described in section 4.6.2. Treatment of incumbents in the bands 2150-2160 MHz and 2686-2690 MHz is described in sections 4.6.3 and 4.6.4. In general, where applicable and feasible, private arrangements are encouraged between incumbent licensees and the successful service provider(s).

4.6.1 General Principles for the Band 2500-2596 MHz

Given the measures contained in this policy for new MCS systems to support learning, the Department believes that incumbent licensees should either vacate the band or, in the event that they wish to remain in operation in this band, should then also provide support to learning. As a result, incumbent licensees having systems whose presence precludes the establishment of specifically planned installations by the successful applicants in this licensing process must include a learning component to their systems (in the form of a Learning Plan see section 5.2.3) to the Department's satisfaction in order to be permitted to remain in operation in the band effectively gaining grandfathered status.

Where the incumbent licensees fails to submit such plan or where the Department deems that the plan is not acceptable, incumbent licensees will be provided two years to vacate the band. Should the Department accept the plan, the licensee will then be allowed to continue to operate their system provided there is no increase in the denial area9 to other licensees. Once the implementation schedules of the new licensees are known, the Department will notify incumbent licensees whose presence precludes access by the new licensees.

As the Department expects that incumbent systems in Toronto and Ottawa will have an immediate impact on the plans of new MCS licensees, incumbent licensees in these areas who wish to pursue obtaining grandfathered status should submit plans to integrate a learning component to the existing MCS systems to the Department no later than October 11, 1999.

Other incumbent licensees across Canada whose systems pose no immediate impact to new MCS systems and who are not contacted by the Department may continue to operate their systems. The Department will communicate with these licensees in the future should MCS rollout potentially affect them.

Incumbent licensees are eligible to participate in the licensing process and if they are successful in the licensing process, their site specific licences within the authorized MCS service area will be revoked and replaced with a spectrum licence, subject to all licence conditions stated herein (including the learning component).

4.6.2 Special Provisions for Manitoba

In 1995, the Department conducted a public consultation10 to address the growing interest witnessed in the 2500-2596 MHz frequency band in Manitoba. Based on the responses, the Department released a licensing guideline11 which established a priority for Instructional Television (ITV) in rural Manitoba and equal access for educational and commercial services in Winnipeg and Brandon. The Department subsequently approved a proposal for extensive use of the 2500-2596 MHz frequency band for province-wide interactive ITV systems in rural Manitoba. This system now effectively precludes access by others in many parts of rural Manitoba, and severely limits access in the centres of Brandon and Winnipeg.

Given the fact that the existing systems in Manitoba operated by school boards already address learning needs, these systems will be permitted to continue to operate under the existing terms and conditions of their licences.

New systems will have access to this band and existing systems will be permitted to grow on a case-by-case basis. Existing licensees wishing to undertake expansion may be required to make changes to their systems to permit equitable use of the band by both other existing licensees and potential new entrants. In congested areas, licensees will be expected to utilize spectrally efficient equipment.

New spectrum designated for MCS, as described under sections 4.1.3 and 4.1.4 will be made available for existing and new MCS systems under the conditions stated therein. However, licensees for the newly designated spectrum in Manitoba will be subject to radio licence fees in accordance with the Radiocommunication Regulations in a similar fashion as for the band 25002596 MHz. The Department is also prepared to consider a request to issue spectrum licences in Manitoba. In this event, the same licence fees would apply as is outlined in section 4.5.1. Those parties wishing to explore the potential implementation of MCS systems in Manitoba should contact the District Director at the address below. Industry Canada will make every effort to accommodate bona fide requests for access and requests will generally be handled on a first-come, served basis.

District Director
Spectrum Management and Telecommunications
Industry Canada
4th Floor, 400 St. Mary Avenue
Winnipeg, Manitoba
R3C 4K5
email: specwpg@ic.gc.ca

top of page

4.6.3 Treatment of Incumbent Licensees in the Band 2150-2160 MHz

In 1995, Industry Canada adopted a full revision of the microwave spectrum utilization policies in the range of 1-20 GHz with the publication of Gazette Notice DGTP-002-95. These policies include the re-arrangement of fixed microwave bands at 2 GHz to enable the implementation of Personal Communications Services (PCS). A moratorium was also placed on any further licensing of new fixed microwave stations in the bands 1990-2010 MHz and 2110-2200 MHz.

Existing fixed systems licensed in accordance with the channel plan contained in SRSP 301.9 (Issue 2) which will be affected by the introduction of MCS in the 2150-2160 MHz have a channel pairing which overlaps PCS blocks A, D, and B (1930-1965 MHz range) in the lower half of the band. Many existing fixed stations have therefore already been displaced out of this portion of the spectrum, particularly in the major urban centres, due to the introduction of PCS.

Industry Canada is of the view that the current moratorium on licensing new fixed systems in this band has been in place for a sufficient period of time that, in conjunction with an appropriate notification period, displacement will not pose undue hardship to the existing licensees. Existing fixed systems will therefore be subject to a transitional displacement process which will facilitate spectrum access by MCS and MDS systems on an "as needed" basis. Notice will be issued by the Department as outlined below, when MCS or MDS licensees have demonstrated a requirement for the spectrum. The principles and policy guidelines for allocation of and access to the spectrum are contained in the document entitled A Spectrum Policy Framework for Canada (SPFC) issued in 1992.

The following provisions apply to the displacement of fixed stations to provide spectrum for licensed MCS systems (and where applicable for MDS systems):

  1. Where necessary, notification for displacement of specific frequency assignments of fixed stations in certain geographical areas will begin to be served after MCS licences have been awarded.
  2. The displacement of frequency assignments of fixed stations and the displacement date indicated in the notification will be based on the spectrum necessary for the implementation of return transmission capability for MCS. MCS operators must ensure that such displacements, including their dates, are critical to meet the MCS implementation plan and that reasonable frequency spectrum alternatives do not exist.
  3. For any frequency assignment subject to displacement, a two-year notification period will be provided. Earlier displacement may be achieved through mutual agreements between the MCS operator(s) and the affected fixed station operator(s).
  4. The fixed station operator will cease the operation of the identified frequency assignment(s) on or before the displacement date indicated in the served notification.
  5. In the event an MCS operator identifies a need to defer a notified displacement date, an amendment to the notice of displacement should be issued at least one year prior to the displacement date in effect.
  6. The MCS and fixed service operators are encouraged to negotiate mutually acceptable displacement dates within the provisions of section (c) above. Industry Canada will retain oversight of the displacement process and will assist, where appropriate, affected fixed operators in identifying new replacement frequency assignments.

Some MCS licensees may also be operators of fixed stations with frequency assignments in the band 2150-2160 MHz. Industry Canada may take necessary action including the incorporation of MCS licence conditions which may address the displacement of such frequency assignments, in order to foster a level playing field amongst the licensed MCS operators and to make available the necessary spectrum.

It should be noted that a significant delay in the use of released frequency spectrum by MCS licensees, after the displacement date, will be viewed by Industry Canada as a serious breach of service commitment.

Industry Canada will monitor the effectiveness of the spectrum policy provisions related to the displacement of fixed systems. Changes to these provisions may be made to ensure that spectrum for MCS services is made available.

4.6.4 Treatment of Incumbent Licensees in the Band 2686-2690 MHz

There is only one system in operation in this band in Canada, located in Calgary. As there has been no prior public consultation on the use of 2686-2690 MHz for MCS return links, this system will be provided four years protection, with a minimum notification period of two years before potential displacement. Upon request by the MCS licensee, the Department will notify this incumbent licensee where the Department concurs with the requirement to displace the incumbent system.

Where applicable and feasible, the Department strongly encourages private arrangements between incumbent(s) and the successful service provider(s).

Date modified: