Policy and Technical Framework
Mobile Broadband Services (MBS) — 700 MHzBand
Broadband Radio Service (BRS) — 2500 MHz Band

PART B — Decisions on a Policy and Technical Framework for Commercial Mobile Broadband Spectrum in the 700 MHz band

B4. Promoting Service Deployment in Rural Areas

148. Through the consultation, Industry Canada sought stakeholder feedback on challenges and specific problems affecting the deployment of MBS to rural and remote areas; changes to existing rules or policy measures needed to facilitate deployments in rural and remote areas; and specific measures to be adopted within the 700 MHz spectrum auction process to ensure deployment of advanced mobile services in rural and remote areas.

149. Rural Deployment Challenges. The majority of respondents felt that it is difficult to support the significant investments required to deploy in areas where there is not a strong business case. Respondents generally commented that given the small populations in such areas, there is also a lower potential return associated with any investments.

150. To address this challenge, Public Mobile recommended government subsidies to support deployment in non-commercially viable areas. SSi recommended that, where possible, incentives be provided to service providers to expand into unserved or underserved rural areas. Such incentives could take the form of a spectrum set-aside, financial subsidies, reduced auction fees, smaller tier sizes and measures to prevent the hoarding of spectrum.

151. Apart from the lack of a strong business case, many respondents cited the operational challenges which exist, such as the requirement to negotiate roaming agreements with large service providers, delays and difficulties in accessing sites, and the limited availability of equipment tailored to the characteristics of remote/rural areas. The Government of Alberta pointed to situations where current spectrum licensees are often reluctant to sub-license their unused spectrum to rural providers.

152. Canadian mobile high-speed packet access (HSPA) broadband coverage is excellent by international standards. Canadian service providers have achieved HSPA wireless coverage to 97% of the population,33 similar to coverage in the United States, and ahead of coverage in much smaller and densely populated countries such as France, England and Spain. However, given the geography, demographics and other factors, existing infrastructure varies from region to region and between different service providers. The remoteness of some regions creates far greater complexity and cost than is the case with urban build-outs. As noted by respondents, there is, at best, a marginal business case to support the significant investment and higher operational costs required to deploy in some of these rural or remote areas. In the most rural and remote areas, deployment may not be commercially viable without government subsidy. Programs such as Broadband Canada: Connecting Rural Canadians and various provincial programs have provided incentives in the past.

153. Nonetheless, there are general measures and others specific to 700 MHz that can be taken to promote service deployment in rural areas.

B4.1 General Regulatory Measures for Rural Deployments

Summary of comments

154. Comments were received from respondents on the need for further regulatory measures or changes to the existing RP-019, Policy for the Provision of Cellular Services by New Parties,34 to facilitate service deployment in rural and remote areas that remain unserved and/or underserved. RP-019 facilitates the provision of cellular services to unserved and underserved areas by enabling entities to apply for access to cellular spectrum in these areas. Some respondents advocated retaining RP-019, others suggested expanding RP-019 to include other frequencies, whereas some suggested removing RP-019 altogether and allowing market forces to prevail. The Ontario Telecommunications Association and Xplornet recommended revising RP-019 to broaden the scope of frequencies covered and to establish another process whereby companies could apply to Industry Canada to reclaim licensed spectrum, on a Tier 4 basis, that is unused within a specified period of time. SSi suggested retaining RP-019 in its present form.

Discussion

155. There are currently various mechanisms for obtaining spectrum in rural areas that include secondary market transfers (including subordinate licensing), the first-come, first-served PCS licensing process (there are some licences currently available in rural areas), and RP-019. Recognizing that RP-019 only applies to the Cellular spectrum, consideration should be given to reviewing the policy to assess possible changes to improve the process and whether the policy should apply to other spectrum bands. However, a review will not result in immediate changes to newly licensed mobile bands, including the AWS, 700 MHz and 2500 MHz bands, as licensees should be able to count on a substantial period of time to deploy systems extensively before such spectrum is subject to RP-019.

Decision related to general regulatory measures for rural deployments

B4-1: RP-019, Policy for the Provision of Cellular Services by New Parties, will be reviewed to assess possible changes to improve the process and determine whether the policy should be expanded to apply to other bands.

B4.2 Specific Measures to be Adopted with 700 MHz Spectrum Auction Process

Summary of comments

156. The majority of respondents recommended specific measures to be adopted within the 700 MHz auction process in support of rural deployment. MTS Allstream, Rogers, SaskTel, Shaw, QMI and TELUS advocated for clearly defined rollout conditions, similar to those set out for AWS licences, to be met within a specified time frame (e.g. five or 10 years).

157. To support rural deployment, EastLink, Government of British Columbia, OTA, Public Mobile, Xplornet, Peace Region Internet Society, British Columbia Broadband Association, Canadian Cable Systems Alliance and Tbaytel recommended a rural set-aside.

158. Rogers commented on the need for a sufficient quantity of spectrum for extensive rural deployment and for it to be economically viable.

Discussion

159. The 700 MHz spectrum is ideally suited for mobile broadband rural deployment given its propagation characteristics. Many respondents suggested that a rural set-aside be implemented, with various forms being proposed. However, one of the major challenges being faced in this auction is the high value of the spectrum for both urban and rural areas, coupled with the very high level of demand for mobile services in the limited spectrum available. Setting aside spectrum for rural providers would require Industry Canada to establish a fairly limited definition of eligible rural providers. This could result in the exclusion of some providers who either have a proven track record in serving extensive rural subscribers or other providers who could have plans to serve rural Canadians.

160. In response to submissions made, Industry Canada has taken into consideration the high level of support for rollout conditions and the operational challenges affecting deployment. It is noted that the cost to deploy will be particularly high for those without existing infrastructure. It is also noted that deployment is more cost-effective (with more capacity per megahertz) when service providers have access to two or more paired blocks of spectrum. Thus, consideration was given to the amount of spectrum required to be cost-effective and minimize operational challenges, the appropriate level of population coverage and the reasonable amount of time for deployment.

161. The 700 MHz spectrum is a key enabler for provision of the latest wireless services to Canadians and a condition of licence is required to ensure that services are delivered to a high percentage of rural areas and that they are not unduly delayed. A condition of licence similar to those applied in previous licensing processes (e.g. 50% of the population within a specified time period) will likely result in significant deployment to urban areas; however, deployment to rural communities would not be assured.

162. To ensure that rural communities are served, deployment must at a minimum reach 90% of the population of the licensee’s existing mobile broadband (HSPA) footprint. Based on national HSPA coverage of 97%, 87% of Canadians would have access to next-generation services on 700 MHz. Raising deployment to 97% of the footprint would mean that 94% of the Canadian population would have access to new services via 700 MHz. It is recognized that requiring licensees in a particular band to expand beyond 97% of their footprint may not be practical, as the existing coverage would probably be sufficient and it is also likely that satellite would be the better solution for many of these areas. Furthermore, in the most rural and remote areas, deployment may not be commercially viable without government subsidy.

163. Various time frames to support rural population coverage for 90% and 97% were considered. A longer time period (e.g. seven years for 90% and 10 years for 97%) for deployment would not be a meaningful condition of licence because the timelines are too distant given the pace of change of technology. A shorter time period (e.g. three years for 90% and five years for 97%) could be overly onerous and may compel licensees to prematurely deploy in areas where HSPA services have been recently deployed and demand does not warrant an immediate overlay. Also, some licensees would likely not have sufficient time to plan and deploy the new network.

164. To facilitate rural communities receiving next-generation mobile services within a reasonable time frame, licensees will be required to deploy the 700 MHz spectrum to 90% of the population of their existing mobile broadband (HSPA) network footprint35 within five years and 97% of their HSPA network footprint within seven years. This time frame of five and seven years will ensure timely deployment of mobile broadband to rural Canadians while permitting some flexibility for companies to put in place business plans.

165. It is recognized that two blocks of paired spectrum provide for increased network efficiencies making it more cost effective to deploy in rural areas. Therefore, the rural deployment requirement will only be applied to entities that have access to two or more blocks of paired spectrum through licences obtained in the auction and/or spectrum sharing arrangements. As noted in Decision B3-4, Industry Canada will consult on the rules related to associated entities to consider changes that would permit certain business arrangements between competitors while still having the caps apply individually. 

166. These requirements will be set out in conditions of licence which will be based on the licensees’ existing HSPA network footprints. For licensees that build a joint network in the future, their HSPA network footprint coverage requirement will be based on existing HSPA network footprint(s). Taking this approach, the ability to meet this condition of licence would be greatly facilitated by the extensive tower infrastructure already in place that covers a significant portion of the population (97% of Canadians at this time). In addition to leveraging existing infrastructure, service providers will also benefit from the efficiencies resulting from access to at least two paired blocks of spectrum. It is believed that leveraging the existing HSPA network footprint through existing infrastructure would ensure that the costs to provide services are not overly onerous. In all instances, the existing HSPA network footprint coverage is the coverage in effect as of the release date of this paper. Standard roaming agreements would not result in the companies being deemed associated.

167. It is recognized that some companies will not have any requirements to deploy to rural areas if their acquisition of spectrum does not include two paired blocks or if their current HSPA footprint is predominantly urban.

168. In addition to the general deployment requirements noted in Section B3, the following condition of licence will also apply.

Decision related to specific measures to be adopted with the 700 MHz spectrum auction process

B4-2: A condition of licence will apply to 700 MHz licensees which requires the following:

B5. Open Access

169. When the 700 MHz band was auctioned in the United States, requirements for “open platforms for devices and applications” were included in the FCC rules applicable to Block C (746-757/776-787 MHz) in the Upper 700 MHz band. The term open platforms for devices refers to the ability of device manufacturers to develop, and of users to procure, the devices of their choosing, as long as the wireless network is not negatively impacted. Open platforms for applications refers to the ability of application developers to create, and of users to download, install and use, the applications of their choice, while complying with certain technical conditions related to the management of the wireless network.

170. In the 700 MHz consultation, comments were sought on whether there was a need for government intervention to promote open access by increasing user access to handsets and/or applications and, if so, what specific measures should be implemented.

Summary of comments

171. The majority of the wireless service providers that provided comments on this topic stated that government intervention is not required to stimulate open access. Bell indicated that the market and technology environment has evolved considerably since 2007 when the FCC decided to implement the open access requirement for 700 MHz Upper C block. Since then, the market has seen the introduction and the widespread adoption of smart phone devices and associated “application stores” which are not under the control of the wireless licensees. SaskTel suggested that government intervention is not necessary, as “there are sufficient competitive forces in the market place already driving vendors and service providers towards open access for platforms and devices.” TELUS pointed out that the “market is already delivering open platforms” aside from the Apple closed platform which is, in fact, extremely popular with consumers. TELUS also considered that, as a possible unintended consequence, a strict interpretation of the open platform provision may block devices based on closed application platforms (like the iPhone) from deployment. Public Mobile proposed that if open access requirements are implemented, they should apply to all service providers and across all spectrum. Mobilicity indicated that if open access is mandated for applications, it should apply only to blocks C1 and C2. Axia supported mandated open access requirements across all future commercial mobile bands. Axia is of the view that since spectrum is a public resource, and while organizations may compete for the right to use it, they should not be able to use that right to stifle or prevent innovation and fair and open competition.

172. Media and content development organizations supported government intervention to promote open access. CACTUS endorsed the principle of open access on all platforms, as spectrum is a scarce public resource and relatively few companies will be able to win any spectrum in this auction.

173. Drs. G. Taylor and C. Middleton from Ryerson University supported “Open Platform Standards” given that “restrictions that restrict user and developer access to wireless networks with the devices and/or applications of their choice limit innovation and constrain consumer choice.”

Discussion

174. The latest generation of wireless services and devices are based on broadband IP connectivity. Advanced user devices recently available on the market are able to connect to the Internet through multiple media types (wired, licensed 3G/4G wireless, or unlicensed types such as WiFi). Users of these advanced services have an expectation of being able to use their mobile broadband devices with the same degree of flexibility and access as using any personal computer connected to the Internet. Based on continued advances in technology and dynamic changes in the marketplace, consumers and businesses are gaining access to a rapidly growing range of wireless devices and applications. Recent evolutions in the market have resulted in the developers of mobile operating systems and consumers having more control over the development, the distribution and the use of mobile applications. Widely available platforms, such as Android, iOS, Windows 7 and Blackberry OS, enable users to access very large collections of applications and content.

175. With respect to hardware and device platforms, most wireless service providers in Canada have adopted the 3GPP family of technologies, i.e. HSPA from the GSM family of standards, for their service delivery. The great majority of Canadian wireless users acquire their devices at subsidized prices directly from the wireless service providers. As mentioned in the 700 MHz consultation paper, Canadian consumers also have the ability to acquire their choice of handset from third party retailers and then purchase wireless only services from service providers with compatible networks. The current practice in the market is that service providers support and welcome such customers with “third party handsets,” as long as these devices are technically compatible and do not harm the wireless network. Moreover, other types of devices based on completely different service models (some of them not “open”) have recently entered and are successful in the market, for example, machine-to-machine communications, e-book readers, etc.

176. Industry Canada concludes that government intervention to promote open access, as described above, is not required.

Decision related to open access

B5-1: No measures to ensure open access provisions, for devices and/or applications, are to be implemented at this time.

B6. Treatment of Existing Spectrum Users

177. Until recently, the 700 MHz band has been used by the broadcasting and broadcasting auxiliary services, as well as low-power licensed devices such as wireless microphones. With recent advances in digital transmission technology, television broadcasting can now be delivered more efficiently (using less spectrum), thereby freeing up spectrum that can be repurposed for other services and applications.

178. Low-power television stations. In preparation for the digital TV (DTV) transition, the CRTC confirmed in 2010 its decision to clear the 700 MHz band of all full-power analog broadcasting transmitters by August 31, 2011. This transition took place as scheduled. In its broadcasting regulatory policy,36 the CRTC noted that broadcasters currently operating outside of the mandatory markets which have chosen not to convert to digital are required to either move their service(s) out of TV channels 52-69 (698-806 MHz) or cease operation of their analog transmitter(s). The CRTC, however, did not make any provisions to transition low-power television (LPTV) operations. Industry Canada stopped issuing LPTV broadcasting certificates for the band 746-806 MHz in 2000.37 In the 700 MHz consultation, Industry Canada announced its decision to cease the issuance of new broadcasting certificates for LPTV stations in the 698-746 MHz range. It also sought comments regarding the use of a transition policy for the displacement of LPTV stations operating in the bands 698-768 MHz and 776-798 MHz.38 Specifically, Industry Canada proposed that the displacement of the LPTV stations operating in these bands be subject to a notification period of one year for LPTV stations located in urban areas; and a period of two years for LPTV stations in all other areas.

179. Those respondents who commented on this issue supported Industry Canada’s proposal.

180. During the DTV transition, approximately 140 analog stations were converted to DTV transmission and their analog TV facilities were switched off. Among the 35 full-power analog stations that were operating in the 700 MHz band prior to the DTV transition deadline, 17 of these were converted to DTV using their post-transition channels below 700 MHz band and nine were converted to LPTV in order to remain in the 700 MHz band on a secondary basis. The remaining full-power analog stations either relocated below 700 MHz (and continued to operate as analog stations) or shut down their operations. Only 51 LPTV stations remain in the 700 MHz band.

181. Low-power licensed devices, including wireless microphones. Comments were sought on the proposal to permit these devices to operate in the bands 698-764 MHz and 776-794 MHz39 only until March 31, 2012. All comments received supported Industry Canada’s proposal with regard to low-power licensed devices, including wireless microphones.

Decisions related to existing users of the 700 MHz band

182. Taking into consideration that no respondents objected to the proposal presented in SMSE-018-10 regarding LPTV and low-power licensed devices, including wireless microphones, these proposals, as presented in the consultation SMSE-018-10, will be adopted.

183. Proposals addressing the operation of wireless microphones below 698 MHz are addressed in Notice No. SMSE-012-11Consultation on a Policy and Technical Framework for the Use of Non-Broadcasting Applications in the Television Broadcasting Bands Below 698 MHz.

B6-1: LPTV stations are permitted to continue to operate, but are subject to displacement. Industry Canada may issue a displacement notice on the following basis:

B6-2: The nine full power stations which converted to LPTV in order to remain in the 700 MHz band on a secondary basis after August 31, 2011, will only be permitted to operate up to the date of the 700 MHz auction. These stations are also listed in Annex 5.

B6-3: Low-power licensed devices, including wireless microphones, will only be allowed to operate in the bands 698-764 MHz and 776-794 MHz until March 31, 2013.

B7. Spectrum Utilization Policy

184. In SMSE-018-10, comments were sought on the adoption of a spectrum utilization policy for the 700 MHz band. It was proposed that commercial services in the band be referred to as Mobile Broadband Services (MBS). MBS systems would be compliant with the Radio Policy RP-014 definition for Cellular Mobile Radio Service (CMRS), and no restrictions would be placed on the types of services offered by licensees under MBS (other than technical compatibility considerations).

185. All comments received on this topic supported the proposed spectrum utilization policy.

Decision related to the 700 MHz spectrum utilization policy

B7-1: Systems for MBS shall comply with the Radio Policy RP-014 definition for CMRS, and no restrictions will be placed on the types of services offered by licensees (other than technical compatibility considerations).

186. A spectrum utilization policy document for MBS systems operating in the 700 MHz band will be published and RP-014 will be updated thereafter.

B8. Changes to the Canadian Table of Frequency Allocations

187. In SMSE-018-10, Industry Canada proposed to update the Canadian Table of Frequency Allocations (herein referred to as “the Canadian Table”) to reflect the global identification for International Mobile Telecommunication (IMT) in the band 698-862 MHz.

188. In 2007, the International Telecommunication Union (ITU) identified additional spectrum for use by IMT systems within the 698-862 MHz band. In particular, the following bands were identified for IMT use in each of the three ITU regions:40

189. Currently, the Canadian Table allows for Broadcasting and Mobile services in certain portions of the band 614-806 MHz. Industry Canada is proposing to allocate the band 698-806 MHz on a co-primary basis to Broadcasting, Mobile and Fixed services, whereas the remaining band 614-698 MHz would remain unchanged. The Canadian footnotes are updated to reflect the new IMT identification as well.

190. Of the 88 comments received in response to SMSE-018-10, no objection to this proposal was noted.

191. Since the consultation paper was published, the international footnote 5.297 (which identifies the band 512-608 MHz for co-primary fixed and mobile allocations) was added to the Canadian Table for the frequency range 470-608 MHz. As a result, this international footnote also needs to be addressed in Canadian footnote C24, which currently applies only to the bands 470-512 MHz and 614-806 MHz.

Decision on changes to the Canadian Table of Frequency Allocations

B8-1: The Canadian Table of Frequency Allocations will be updated to include the following:

MHz

470-608
BROADCASTING

5.293 5.297 C24
...
614-698
BROADCASTING

5.293 C24
698-806
BROADCASTING
FIXED
MOBILE 5.317A C7

5.293

C24 (CAN-11) In the bands 470-608 MHz and 614-806 MHz, international footnotes 5.293 and 5.297 have raised the fixed and mobile services to a co-primary status with the broadcasting service. In Canada the fixed and mobile services have primary allocations only in the 698-806 MHz range. Industry Canada will carry out public consultation in the future in order to consider adopting the other service allocation provisions of international footnotes 5.293 and 5.297 in the frequency bands 470-608 MHz and 614-698 MHz.

C7 (CAN-11) International Footnote 5.317A provides administrations with the flexibility to implement International Mobile Telecommunications (IMT) in the parts of the band 698-960 MHz that are allocated to the mobile service on a primary basis. The application of 5.317A is limited to the bands designated for cellular mobile radio systems, cellular mobile telephony and trunked mobile systems. The bands 698-758 MHz and 776-788 MHz, 824-849 MHz and 869-894 MHz are designated for cellular mobile radio systems, cellular telephony services and the bands 806-821 MHz, 851-866 MHz, 896-902 MHz and 935-941 MHz are designated for trunked mobile services and, as such, can evolve to accommodate IMT service capabilities.


Footnotes

  1. 33 CRTC Communications Monitoring Report, July 2011.
  2. 34 See RP-019, Policy for the Provision of Cellular Services by New Parties, at http://www.ic.gc.ca/eic/site/smt-gst.nsf/eng/sf01593.html.
  3. 35 The HSPA network footprint is defined as the total area where a licensee provides mobile HSPA service by way of its own network facilities, in any commercial mobile band.
  4. 36 For further information regarding the CRTC decision, refer to the Broadcasting Regulatory Policy CRTC 2010-167.
  5. 37 Refer to Industry Canada’s letter to the CRTC in response to Public Notice CRTC 2000-127Call for comments on a licensing framework for low-power community television undertakings in urban areas, and in other markets not covered by existing policy (http://www.ic.gc.ca/eic/site/smt-gst.nsf/eng/sf08086.html).
  6. 38 LPTV operations in the bands 768-776 MHz and 798-806 MHz are addressed in SP-768 MHz.
  7. 39 In the bands 764-776 MHz and 794-806 MHz, which are designated for public safety systems, operation of wireless microphones is already prohibited as per SAB-001-10.
  8. 40 ITU Region Map: http://www4.plala.or.jp/nomrax/ITU_Reg.htm.
  9. 41 Although the band 790-960 MHz was identified for IMT in Region 3, Bangladesh, China, Korea (Rep. of), India, New Zealand, Papua New Guinea, Philippines and Singapore also identified the band 698-790 MHz to align with Region 2. The frequency arrangements for the respective regions are found in the document ITU-R M.1036-2.
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