Consultation on the 24 and 38 GHz Frequency Bands: Proposed Policy and Licensing Procedures
The authorizations that will be available for assignment will be spectrum licences which are defined in subparagraph 5(1)(a)(i.1) of the Radiocommunication Act as authorizations "in respect of the utilization of specified radio frequencies within a defined geographic area".
The proposed attributes of these spectrum licences and the proposed conditions that will be attached to them are described below. The Department proposes that the elements of the "common framework" for spectrum auctions laid out in the Framework for Spectrum Auctions in Canada document be adopted for the licensing of 24 GHz and 38 GHz spectrum.
The Department has established four tiers of service areas - ranging from a single national service area (Tier 1) down to a set of 162 more localized areas which cover the entire geography of Canada (Tier 4) - which it intends to use for future spectrum auctions, and perhaps in other licensing situations. These service area tiers are based on contiguous groupings of Statistics Canada's Census Divisions and Subdivisions. A summary of these tiers is in Appendix B of this document. For full details of the tiers, please refer to the document Service Areas for Competitive Licensing.12
The appropriate size of service areas for the licensing of spectrum in the 24 GHz and 38 GHz bands must be determined. Should the Department assign a national licence, regional licences, or licences which have smaller and more localized service areas? There are advantages and disadvantages to having a large number of small service areas or conversely, to having a small number of large service areas. In considering the trade-offs the Department considers one principle to be key: no licence should be so small, in terms of either bandwidth or geography, that on its own it could not provide a viable business opportunity for some bidders.
When the licences available are auctioned as smaller service areas, bidders are permitted greater flexibility in acquiring the precise aggregation of areas that they most prefer. As well, this allows more small players to effectively participate in the auction. However, the choice of numerous licences having small service areas also adds to the complexity of the auction by increasing the likelihood of confusion and errors. It is more difficult for bidders to monitor round-by-round bidding activity on a large number of licences than it is on a small number of licences. To compensate for the increased complexity, the pace of the auction may have to be reduced.
Auctioning numerous service areas can also increase the possibility of "stranded" bids. For example, Bidder A may have a business plan that depends on the acquisition of two adjacent service areas. If service areas X and Y are auctioned as individual licences, Bidder B may thwart Bidder A's plan if it bids on the service area Y licence. A possible outcome for Bidder A is that it ends up being the high bidder on only the service area X licence. Thus Bidder A will not realize the desired aggregation on which its business plan depended and will also have acquired a licence for which it now has no use. Had service areas X and Y been auctioned together as part of one licence, then there would have been no possibility for Bidder A to end up with a stranded bid on the service area X licence.
Conversely, auctioning a small number of larger service areas will not allow bidders as much flexibility in completing their desired geographic aggregation. The ability of smaller players to participate in the auction may also be impeded. (By making licences divisible, however, smaller players may be able to acquire the service areas they need from auction winners through the secondary market.) A smaller number of licences reduces the likelihood of bidder errors, allowing the pace of the auction to be quicker. Finally, the likelihood of stranded bids occurring is reduced when larger licences are auctioned.
The Department is of the view that the services likely to be offered with 24 GHz and 38 GHz spectrum would be amenable to licensing on a regional/local basis and, after considering the trade-offs discussed above, proposes that Tier 3 service areas13 be used for these bands.
The proposed frequency band structure for the 24 GHz and 38 GHz bands was discussed previously in section 3.1 of this document. Five frequency block pairs of 40+40 MHz were proposed for the 24 GHz band (for a total of 400 MHz) and between seven and nine 50+50 MHz frequency block pairs were proposed for the 38 GHz band (for a total of 700 MHz to 900 MHz).
In addition to the technical question of how the spectrum blocks should be structured, there is the crucial question of how these spectrum blocks will be "packaged" for licensing. Using the 24 GHz band as an example, should the entire 400 MHz available be offered as one licence in each geographic area, or should it be divided into a number of smaller licences which will be assigned individually? There are advantages and disadvantages to having a larger number of smaller licences (for example, five 40+40 MHz licences) and to having a smaller number of larger licences (for example, one licence for the entire 400 MHz). Once again, the Department considers one initial principle to be key: no licence should be so small, in terms of either bandwidth or geography, that on its own it could not provide a viable business opportunity for some bidders.
As with the choice of the appropriate geographic size of licences, there are trade-offs involved when choosing between a small number of licences with a large amount of bandwidth and a large number of licences with a small amount of bandwidth. Numerous licences with smaller amounts of bandwidth allow for greater flexibility and provide more opportunities for smaller players, but also add to the complexity of the auction and increase the likelihood of problems with stranded bids. Having fewer licences with larger amounts of bandwidth reduces the complexity of the auction and reduces the likelihood of stranded bids, but, as is the case with the geographic dimension, bidders will not have as much flexibility in completing their desired spectrum aggregations and the ability of smaller players to participate in the auction may be impeded. (Again, by making licences divisible, smaller players may be able to acquire the spectrum they need from auction winners through the secondary market.)
Proposed Spectrum Licence Packages
Having considered the trade-offs discussed above, the Department proposes that the five 80 MHz paired blocks in the 24 GHz band be packaged as a single 400 MHz spectrum licence. Also, the Department proposes that the paired blocks in the 38 GHz band be packaged as follows: one 400 MHz spectrum licence, one 300 MHz spectrum licence and one 200 MHz14 spectrum licence as indicated in Table 3 below.
|Spectrum Licence||Size (MHz)||Lower Frequency (MHz)||Upper Frequency (MHz)|
The Department proposes that licences have a ten-year term and a high expectation of renewal at the end of the term. That is to say, the Department intends to generally renew licences for subsequent ten-year terms unless a breach of licence condition occurs, a fundamental reallocation of spectrum to a new service is required (e.g. a reallocation by the International Telecommunication Union), or an overriding policy need arises (e.g. a spectrum reallocation to address a national security issue). To provide a more stable investment climate for licensees, a consultation process will commence no later than two years prior to the end of the licence term (i.e. after year eight) if the Department foresees the possibility that a licence will not be renewed. The imposition of any renewal fees and/or amendments to licence conditions for the initial licensees in the subsequent term will also be addressed in a consultation process which will commence no later than two years prior to the end of the licence term.
In the event of bankruptcy or insolvency of a licence holder, the status and treatment of the licence will be subject to the general laws of bankruptcy and insolvency.
Transferability of Licences
The Department proposes that auctioned licences will be transferable subject to the following conditions and guidelines.15
- All eligibility criteria and conditions that apply to a licence, including those related to interference management, will continue to apply should the licence be transferred.
- Should an auction winner transfer its licence to another party, for example, four years into a ten-year licence term, the second party will only receive a licence term equal to the remaining six years, but will be eligible for the same licence renewal provisions as the original licensee.
- All proposed licence transfers must comply with any spectrum aggregation limits or other measures intended to preclude anti-competitive behaviour that may be in place.16
- Written notification will be required of all proposed licence transfers. The Department will also request attestations or other documentation to ensure that the points above (e.g. compliance with the eligibility criteria) have been satisfactorily addressed. Once a licence transfer has been registered, the Department will revoke the original licence and issue a new licence in its place.
- The Department will maintain a publicly accessible database listing all auctioned licences and the respective licensee and will update the database upon a licence transfer.
Should Transferability be Delayed?
For this licensing process, the Department solicits views on whether the transferability of licences should be delayed for a specific time period, for example, three years following this licensing process. A moratorium on transferability may discourage bidding for speculative purposes and would ensure that bidders participating in the auction have a genuine desire to utilize the spectrum in the markets they wish to acquire.
There are also disadvantages to this approach. Some post-auction secondary market transactions may be required to "fine-tune" the distribution of the spectrum. A moratorium on transferability will obviously not allow such transactions to occur. As well, given that the services and technologies associated with 24 GHz and 38 GHz spectrum are new and developing, bidders may face some uncertainty in determining the exact amount of spectrum they may require in various service areas. As more information about market opportunities and technology becomes available post-auction, secondary market transactions may lead to a more efficient allocation of the resource.
The Department also proposes that licensees be permitted to transfer their licences not only in whole, but also in part. Licences will therefore be divisible in both the bandwidth and geographic dimensions.
The Department does not foresee the need to impose significant limitations on licence divisibility. There is no reason to assume that both the parties involved in the division of a licence would not be interested in minimizing interference and maximizing the reliability of the services they will provide. In order to maintain compatibility with the Department's database, licences will be divisible in the geographic dimension only in terms of Spectrum Grid cells17. Thus when an auctioned licence is divided, the minimum geographic size that any one of the new divisions may take is one Spectrum Grid cell. The individual Spectrum Grid cells are sufficiently small that even with this restriction, an extremely high degree of flexibility will be available to the parties involved in determining the size and shape of sub-divided portions of a licence.
As for the bandwidth dimension, the Department will require compliance with emission limitations in the frequency blocks immediately outside and adjacent to each of the resulting frequency blocks, and with the spectrum assignment plan as defined in the final policy document and the accompanying Standard Radio System Plan (SRSP).
It should be noted that the division of a licence may increase the number of parties with whom other neighbouring licensees must communicate when attempting to minimize the potential for interference at the boundary between service areas and/or at the band edge between spectrum blocks.
In any situation, where there is a request for the transfer of a portion of a licence, the original licensee will be required to return its licence to the Department. Once the transfer has been registered, the Department can amend the original licence and issue a new licence to the transferee.
Should Divisibility be Delayed?
For this licensing process, the Department solicits views on whether the divisibility of licences in the bandwidth dimension and the geographic dimension should be delayed for a specific time period, for example, three years following this licensing process. A moratorium on divisibility would discourage bidding for speculative purposes and would ensure that bidders participating in the auction have a genuine desire to utilize the spectrum in the markets they wish to acquire.
On the other hand, a delay in opening the secondary market following this licensing process would severely reduce the chances for smaller players to develop niche offerings as they will not be able to acquire spectrum from auction winners. For example, a small player wishing to deliver services to rural areas would not be able to acquire a sub-divided portion of the licence won by a bidder whose primary aim is to serve the urban centre within a service area.
As noted in the introduction, a goal of this licensing process is to help connect Canadians. To do so requires that the spectrum assigned through this licensing process be utilized in a timely manner such that Canadians have access to new wireless broadband services. A possible method to achieve this goal is to require successful licensees to implement their services within, for example, three years. Following this period, the Department would conduct a review of the implementation of the services which could lead to a revocation of the licence without a return of payment should a licensee not have implemented service. This may prevent a licensee from acquiring the spectrum simply to block the entry of competitors into the marketplace. On the other hand, there may be reasons outside the control of the licensee which would not allow them to quickly implement service. For example, the unavailability of equipment or undesirable or unexpected market conditions could lead to a delay in the implementation of services beyond the specified implementation period. The Department recognizes that if roll-out requirements are to be a condition of licence, they must be clearly and objectively defined before the auction.
The conditions of licence will be clearly stipulated prior to an auction. The Department proposes the following:
- Licensees must comply with the eligibility criteria as set out in the Radiocommunication Act. Licensees must notify the Minister of any change which would have a material effect on ownership or control in fact. Such notification must be made in advance for any proposed transactions.
- Licensees must, from the inception of service, provide for and maintain lawful interception capabilities
as authorized by law:
- The requirements for lawful interception capabilities are provided in the Solicitor General's Enforcement Standards for Lawful Interception of Telecommunications (Rev. Nov.95). These standards may be amended from time to time following consultation with the Solicitor General of Canada and the licensees.
- Licensees may request the Minister to forbear from enforcing certain assistance capability requirements for a limited period. The Minister, following consultation with the Solicitor General of Canada, may exercise his power to forbear from enforcing a requirement or requirements where, in the opinion of the Minister, the requirement(s) is (are) not reasonably achievable. Forbearance requests must include specific details and dates when compliance to requirement(s) can be expected.
- While site specific radio licences will not be required for each radio station, licensees must
- radio stations are installed and operated in a manner that complies with Health Canada's limits of exposure to radiofrequency fields18;
- where applicable, antenna structures are marked in accordance with the recommendations of Transport Canada; and
- prior to installation of significant antenna structures, consultation with the appropriate land use authorities has taken place.
- Licensees must comply with international coordination requirements with the United States as they are developed. While frequency assignments are not subject to site-by-site licensing, licensees may be required to furnish all necessary technical data to Industry Canada for each relevant site in order for international coordination to be effected with the United States as per the terms of any existing or future sharing arrangement. Should international coordination be required, Industry Canada will identify the appropriate data elements, format and means of submission.
- Licensees must comply with domestic and ITU Radio Regulations pertaining to their licenced bands.
- Licensees must invest 2% of adjusted gross revenues in telecommunications research and development. The eligible research and development activities are those which meet the definition adopted by Revenue Canada which is outlined in the Income Tax Regulations made pursuant to the Income Tax Act. For further information concerning R&D procedures, please refer to the document Guidelines for Compliance with the Radio and Spectrum Licence Conditions Relating to R&D.19
- Licensees must submit an annual report for each of the first five years indicating continued
compliance with these licence conditions including:
- an update on the implementation of wireless services - this update should include the number of hub and subscriber sites installed;
- as noted above, an audited statement of research and development expenditures for the fiscal year covered by the report; and
- a copy of any existing corporate annual report for the licensee's fiscal year with respect to the authorization.
The reports are to be submitted, in writing within 120 days of the licensee's fiscal year end, to the Director, Spectrum Management Operations, Radiocommunications and Broadcasting Regulatory Branch. Confidential information provided will be treated in accordance with Section 20(1) of the Access to Information Act.
- Licensees must comply with the spectrum aggregation limit as described in section 3 of this document.
- Licensees must comply with the transferability and divisibility requirements of spectrum licences as described in section 4 of this document.
- Licensees must utilize the spectrum for bona fide wireless telecommunication services with-in three years following the close of this licensing process.20
The following sections discuss technical aspects to be considered when responding to the proposals contained in this document, or in submitting new proposals. Comments are solicited in areas that will influence the technical requirements for the bands.
Boundary conditions are to be applied at the edges of licensed areas. These conditions are intended to minimize the potential for radio interference between neighbouring licensees. To the potential licensee they provide indications on the conditions beyond which radio interference may be received from or transmitted to a neighbour. A set of boundary conditions will be required for block and area implementations.
The intent is to assign all of the spectrum within each licensed area, and to allow assigned frequency channel blocks to be subdivided and used within the licensed area, subject to the rules for interference management which will be developed in consultation with industry.
One of the attractive aspects of the block area assignment is the freedom to use the given spectrum in a particular area with a minimum number of restrictions. There is also a measure of expectation implied by a block and area licence of unencumbered access to the spectrum within the licensed area at any given time.
The block area implementation in this proposal will result in situations where licensees hold spectrum licences for an area with the knowledge that co-channel assignments may be made in directly adjacent areas and adjacent channel assignments may be made within the same service areas. Such situations may lead to interference between systems of different licensees unless some measures are taken prior to the system implementation.
Operation of co-channel systems in directly adjacent areas may be difficult without system specific communication between licensees, since the potential for one system to interfere with another system typically extends for distances much greater than the desired link length. The closer the systems are to each other, the more the interaction is required. Minimizing these constraints to increase exclusivity of operation would therefore come at a cost in either spectrum or geography. The same is true for the operation of adjacent-channel systems within the same licensed area.
The following sections discuss the various aspects to be considered to initiate communications between licensees.
Communications between licensees can be triggered in several ways, typically using distance or power flux density (pfd) as a criterion. If the trigger criterion is distance, this distance needs to be sufficiently large to ensure minimum interference between systems. Similarly, if the trigger criterion is pfd, this pfd needs to be sufficiently low to ensure minimum interference between systems.
The most common trigger is distance. The value is typically based on worst case parameters to ensure that the possibility of interference is reduced. Radiated power level, effective antenna height, receiver sensitivity and configuration are combined to determine a distance within which there is a possibility for interference between two systems. A table of distances based on transmitter heights and powers reduces the burden of coordination for systems not operating at the maximum power level. Distance can be measured either to a specific receiver location or to an area within which receivers are likely to be deployed.
Similarly, communications between licensees can be triggered by a field strength or a power flux density at a receiver location or at the boundary of an area within which receivers will be deployed. Due to the spreading loss, the effect of a pfd calculated at an area boundary will have different interference potentials at specific receiver sites within that area, depending on the geometry between the wanted receiver and the interfering transmitter.
As with distance, the allowable pfd at a boundary to minimize interference to receivers within the area will depend on the radiated power and height. While a single value may be desirable, a table of values based on power and height would be more accurate. The calculation methods to determine the compliance with a pfd are typically based on worst case propagation conditions since the specific path profiles to all receivers are not usually known at the time a determination is made of the requirement to coordinate.
Both distance and pfd triggers must be set at appropriately conservative values to minimize the potential for interference to adjacent systems, since outside these values, licensees can operate without the requirement to communicate with neighbouring licensees. In order to provide service right up to a boundary and to allow equitable access to spectrum on an on-going basis, additional constraints to operation are normally required. An example is the current bilateral arrangement with the U.S. at 2.5 GHz, which prescribes orthogonal polarizations within 80 km of the border. For systems which intend to re-use all the available spectrum within each cell, and more particularly where the cells are to be divided into sectors based on polarization reuse, this becomes very constraining.
Practical experience for services in many frequency bands has demonstrated that once communication between licensees has been triggered, actual systems can be implemented in much closer proximity than the worst case values would indicate.
Operators will be expected to take full advantage of interference mitigation techniques such as antenna discrimination, polarization, frequency offset, shielding, site selection, or power control to facilitate co-existence with systems of other service providers, at both design and implementation stages. Operators within the same general area will be encouraged to enter into mutually beneficial arrangements to foster efficient spectrum use near their common boundaries. In cases where harmful interference occurs or appears likely to occur between radio systems, and where such interference cannot be resolved between licensees, it will be necessary to establish a method for interference prediction as the basis for arbitration by Industry Canada. This method should be carefully considered in establishing the appropriate boundary conditions, trigger mechanisms and values, as well as the size and locations of the service areas.
In general, there are three aspects to be taken into account when considering the potentialfor interference between systems:
- signal levels into adjacent areas using the same channel (Co-Channel, Adjacent-Area);
- signal levels into adjacent channels within the same service area (Adjacent-Channel,Same-Area); and,
- considerations for two-way and duplexing method.
As well, the intention to deploy point-to-multipoint as well as point-to-point systems willneed to be closely examined.
The potential for one system to interfere with another system typically extends for distances much greater than the desired link length. It will be extremely difficult to accommodate Co-Channel/Adjacent-Area systems in close proximity without knowing the characteristics of both systems.
For most point-to-area systems it is possible to cover an area with contiguous cells. A basic premise is that this should be attainable regardless of who actually owns or operates the individual cells. This applies particularly to systems which are similar in design, characteristics, deployment, intended service, power, spectrum use (channelization, bandwidth, frequency pairing etc.), and access scheme modulation. The situation becomes more complex where the characteristics are different, particularly in power and spectrum use. Licensees attempting to implement systems in close proximity to each other and/or to a licence area boundary will require knowledge of both systems to allow the incorporation of mitigating design and deployment considerations to allow coexistence.
Adjacent channel operation within the same area will have the potential for interference, particularly with respect to the near/far effect at the subscriber receiver when the transmitting hubs are not located in reasonably close proximity. Hubs receiving in adjacent spectrum could also suffer the same near/far problems as subscriber terminals especially when the hubs are not co-located. An emission limit at the channel block edges will alleviate some of the potential for interference, but not completely, especially where there is a mix of applications with different power requirements and intended service within the same licensed area.
From an interference standpoint, co-location of hub transmitters may be desirable, but differences in power requirements, intended market, or business cases may make this infeasible. The size of area will also play a major role in the complexity of coordination since the larger the area, the greater the requirement for multiple hubs to provide service.
Out-of-block emission limits will be required to minimize inter-system interference. Point-to-area systems are less constrained when the emission limits are applied to a block of spectrum rather than to individual channels within the block. Consideration should be given to the application of an absolute emission limit at the block edge, i.e. independent of carrier level and frequency tolerance.
Return traffic will require some consideration for Co-Channel/Adjacent-Area interference from subscriber terminals into adjacent hubs and from hubs into adjacent subscriber terminals.
Similarly, in the case of Adjacent-Channel/Same-Area situations, consideration should be given to the following:
- Potential interference to subscriber receivers from subscribers transmitting in adjacent spectrum;
- Potential interference to subscriber receivers from hubs transmitting in adjacent spectrum;
- Potential interference to hub receivers from hubs transmitting in adjacent spectrum; and
- Potential interference to hub receivers from subscribers transmitting in adjacent spectrum.
There is the potential with two-way system implementation that Adjacent-Channel/Same-Area hubs will be receiving in spectrum in which adjacent subscribers are transmitting. Consideration may be given to common hub/sub or go/return designation; however, coexisting with adjacent channel point-to-point systems may be more difficult.
Point-to-area implementations with ubiquitous subscriber locations lend themselves to type-approval of equipment. A certification specification will be required. The details will be developed in consultation with the RABC.
The band 24.75-25.25 GHz is currently allocated to the Fixed Satellite Service (FSS) (Earth-to-space) and is intended for use by Broadcast Satellite Service (BSS) feederlinks in support of the band 17.30-17.80 GHz. As per the proposed change to footnote C44 in the Canadian Table of Frequency Allocations, future earth stations will be permitted, provided that such installations do not cause interference to any fixed systems operating within the authorized service areas.
Licensees will be expected to respect ITU Radio Regulations pertaining to the 24 and 38 GHz bands and abide by any future agreements established with other countries.
Bilateral arrangements with the U.S. in the 24 GHz band may include consideration of the BSS feederlink issues with respect to Fixed Service (FS) Multipoint Communications Systems.
The assignment of undertakings near the Canada/U.S. border is subject to the coordination agreements established between the two countries. Bilateral negotiations for the 24 and 38 GHz bands between Industry Canada and the Federal Communications Commission of the United States are on-going. Until an agreement has been reached, any service area within 56 km (35 miles) of the international border is considered as falling within the coordination zone which is presently applicable for 18 GHz and 23 GHz fixed systems.
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