TORONTO – Cell tower sharing remains a white hot topic for wireless competitors and the issue raised its head Tuesday morning during the Canadian Telecom Summit’s annual regulatory blockbuster panel, moderated again this year by Cartt.ca editor and publisher Greg O’Brien.
Although mandated tower sharing was included in the 2008 AWS spectrum auction rules – as it will be for next year’s 700MHz spectrum auction – the problems for new wireless entrants are the growing costs to share tower space and that access rules are not adhered to by the three incumbents, said Ed Antecol, vice-president of regulatory affairs and carrier services for Globalive/Wind Mobile.
Antecol said new entrants pay “atrocious rent” to put its transmitters on an incumbent’s cell tower, which sometimes is the new entrant’s only option. “We pay as much sometimes to put an antenna on an undesirable portion of a tower than it costs to build a whole new tower,” he said. “In some cases, we’re paying charges to repair a tower to not only include our own antennas but future-use antennas of the incumbents as well.
“That just sucks capital from a new entrant and subjects the new entrant to an incredible amount of abuse,” Antecol said. “I think we’re a far cry from a level competitive playing field.” Since most municipalities refuse to be dotted with multiple towers from multiple carriers, sharing is the only option.
Ted Woodhead, senior vice-president for federal government regulatory affairs at Telus, shot back saying he remembers Antecol “pulled the fire alarm over some tower access request with Telus” during last year’s regulatory panel battle. After Woodhead asked his Telus staff to look into the request and to prepare all of the necessary information for Antecol’s company, Wind Mobile withdrew its request at the last minute anyway, he added.
“So that fire alarm got pulled, but it obviously wasn’t as serious as you were making out,” Woodhead said.
Ken Engelhart, senior vice-president of regulatory affairs and chief privacy officer for Rogers Communications, had a similar story to tell. He said he has met Antecol twice for lunch to discuss his tower request for Rogers, only to have the requests withdrawn later. “He makes oodles and oodles of requests, we comply with those requests, we give him access to the towers, we spend thousands of dollars in engineering time doing it, and then he withdraws the request,” Engelhart said.
“This notion that there’s a tower problem is something that Ed likes to say in speeches, but it’s just not true,” Engelhart said.
Antecol reiterated his point that the issue for new entrants is one of a tower costing problem, although in the early days it was a tower access issue.
“Towers are expensive,” Engelhart agreed. “I’m a tenant on thousands of towers. I hate it, I pay through the nose. If you want to try to get a tower spot from the CBC, it’s brutal, it’s a brutal process. They charge you a fortune… Do you want me to show you what I pay on other people’s towers and you agree to pay that?”
In response, Antecol argued: “If we solve the problem of my access to your towers, it will solve the problem of your access to other people’s towers, because they will be subject to the same rules.” He added there are fundamental problems with the current tower sharing rules, which he said he hoped the federal government would address over the coming months.
700 MHz delay
Later, when all of the regulatory panellists were asked whether or not they thought it was a good thing Industry Canada Minister Christian Paradis announced Tuesday morning that the 700MHz spectrum auction process would be pushed back three months, responses varied from “good” to “indifferent”.
Woodhead said he was indifferent to a three-month delay, but said he thinks it’s time Canada got on with the next spectrum auction, seeing as the U.S. auction of the 700MHz band was five years ago.
Mirko Bibic, executive vice-president and chief legal and regulatory officer for Bell Canada, said it is a short delay, which is ultimately good. “It’s best to know all the circumstances before you put your deposit down and get to the auction, know what the rules are, the spectrum transfer rules that are coming,” Bibic said.
Bibic was alluding to the other part of Minister Paradis’s announcement in Ottawa on Tuesday that essentially quashed Telus’s acquisition of Mobilicity, by rejecting the incumbent’s application to transfer the new entrant’s spectrum licences before the five-year time limit stipulated in the 2008 AWS auction rules. Transferring licences for spectrum set aside for new entrants in the AWS auction will not be permitted until early 2014.
He suggested the industry minister’s announcement may also draw into question Rogers’s proposed purchase of unused spectrum currently owned by Shaw Communications. As part of his announcement from Ottawa, Minister Paradis had said spectrum transfers that result in “undue spectrum concentration” will not be permitted, a restriction that will apply to all commercial mobile spectrum licences, including the 2008 AWS licences.
Spectrum Hoarding
Wind Mobile’s Antecol presented a pie-chart graphic that outlined the current spectrum ownership picture in Canada. “As you can see, Bell, Rogers and Telus have 85 per cent of the available mobile spectrum,” Antecol said to the audience. “The rest, the remaining 15 per cent is held in little slices by a whole host of other service providers.”
Antecol called spectrum “the lifeblood” of any wireless carrier, adding: “New entrants have it far worse than the incumbents in terms of the need for spectrum. So congratulations, Minister Paradis, on taking the steps you did today to help solve this problem.”
Wireless Code of Conduct
Congratulations were also given to the CRTC for its release on Monday of its wireless code. John Lawford, executive director and general counsel of the Public Interest Advocacy Centre (PIAC), said he was “ecstatic” that the CRTC included caps for roaming and data usage in the code. “This is pure consumer protection. It is there to remove abuse of consumers, and you all know how bad it was,” he said. “So kudos to the CRTC for calling you on it, and shame on all of you for letting it go on for that long.”
However, Lawford said he is not completely happy with the code, because the CRTC didn’t address some other consumer concerns such as being charged by wireless providers for receiving a paper bill. He said charges related to mobile premium text messaging services were also a concern for many wireless customers. “Lastly, the critical information summary – it’s nice to have it on the front of the contract to summarize what’s inside it, but that was not its purpose,” Lawford said. “The purpose was to let a consumer shop around and take that to providers to compare offers. So I think that was a missed opportunity.”
The CRTC’s wireless code now lets mobile customers cancel their contracts after two years without having to pay a penalty. Wind Mobile’s Antecol said wireless incumbents often used three-year contracts as a customer retention tool. “It was all about locking up the market. It really wasn’t about offering any better or worse deal,” Antecol said.
Bell’s Bibic argued that customers always had a choice about the length of their wireless contracts.
“For 28 years, there were zero-, one-, two- and three-year contracts offered,” Bibic said. “Over 80 per cent of customers freely chose three-year contracts.”
Bibic said that, every year, more than 10 million Canadians are off contract. “They’re free agents. That’s a third of wireless subscribers in Canada. But despite that, over 90 per cent freely choose to go back to their existing provider. There’s free choice all the way,” Bibic said.
