Government’s options in shaking up wireless market

Incumbent Canadian wireless service providers might view it as a big win that there are no foreign or major new entrants in the upcoming spectrum auction, however, there are still plenty of options left to the government to push along competition in the sector.

With the announcement by United States-based wireless provider Verizon Communications that it was opting out of rescuing two of Canada’s startup carriers, the government’s its bid to introduce new competitors to the market has failed but it can still use regulations to shake up the industry, according to consumer advocate and University of Ottawa Law professor Michael Geist.

The government can also create a regulated mobile virtual network operator (MVNO) market, Geist said in a recent blog.

MVNOs do not own spectrum or network infrastructure, instead they purchase network access at wholesale prices from existing operators and resell it to customer at retail prices.

Canadian-owned Ting Inc., which was launched in 2012 by Tucows is quite a success in the MVNO space in the U.S. Unfortunately its services are not available in Canada. Geist said the government can use regulation to create MVNOs in Canada.

Geist said that two other “big steps” are underway: The consumer wireless code, which limits contract length; and the potential Canadian Radio-television Telecommunications Commission (CRTC) regulation of wireless roaming prices.

He argued that the “mere threat” of regulation can prompt incumbent providers to lower prices and pursue market reforms just as Bell Canada slashed is U.S. roaming prices shortly after the CRTC roaming initiative.

Geist said the government can start with eliminating foreign investment restrictions in both telecom and broadcast distribution sectors.

It can also impose stricter tower sharing requirements and domestic roaming rules to make it easier for smaller players to grow their networks.

Read the whole story here

Nestor E. Arellano
Nestor E. Arellano
Toronto-based journalist specializing in technology and business news. Blogs and tweets on the latest tech trends and gadgets.

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