Canada raises $7.2B in 3.5 GHz auction for 5G

Canada wrapped up its $7.2 billion 3.5 GHz auction last week, ending in per-MHz POP bids that were higher than the record-setting C-band auction in the U.S.

The three largest carriers bid the most in the auction, but the Canadian government pointed out that, as intended, more small and regional providers gained access to significantly more spectrum.

Rogers Communications is spending $2.7 billion for licenses in 169 out of 172 regions in Canada, while Bell Mobility is acquiring 271 licenses for a total of $1.7 billion. Telus, the third highest bidder, is spending $1.5 billion.

Rogers, which is in the process of acquiring rival Shaw Communications for about $16 billion, noted that this latest investment positions the company as the largest single investor in 5G spectrum in the country across rural, suburban and urban markets.

The company said its spectrum purchase will be funded through its existing cash balances and bank credit facilities. Rogers plans to use the spectrum to support fixed wireless access (FWA), mobility, broadband IoT and mobile edge computing (MEC).  

RELATED: Rogers begins 5G rollout in Canada

Rogers was the first operator in Canada to launch a 5G standalone (SA) core; it used Ericsson gear for that.

“This investment in 5G spectrum will build on our existing 5G assets and enable us to deliver the world-class connectivity Canada needs to increase productivity, fuel innovation, create jobs, and compete in a global economy for decades to come,” said Rogers Communications President and CEO Joe Natale in a statement. “We went into this auction with a clear plan and acquired the spectrum we need to continue driving the largest and most reliable 5G network in Canada and to deliver long-term value for our customers, shareholders and Canada.”

Bell has the distinction of being the first to offer 5G roaming in the U.S. Bell’s 5G is currently available to about 35% of the Canadian population and is expected to reach 70% by the end of 2021. Bell said its Wireless Home Internet (WHI) service is bringing broadband internet access to small towns and rural locations in Atlantic Canada, Québec, Ontario and Manitoba, and will be enhanced with 5G capability later this year.

Canadian carriers paid on average $3.28 per MHz-POP for 3500 MHz spectrum, which was almost three times higher than the $1.19 per MHz POP that U.S. carriers paid in the FCC’s most recent auction of 5G spectrum, noted Telus.  

Telus also pointed out that international carriers pay much less for spectrum than their Canadian counterparts, and as a result, the impact of 5G on the Canadian economy will not transpire at the same level as other Organization for Economic Co-operation and Development (OECD) countries given regulatory conditions and spectrum policies.  

“Canada’s position as a global leader in broadband networks is vulnerable to burdensome regulations governing access to spectrum,” said Telus President and CEO Darren Entwistle in a statement. “Going forward, if we are to truly benefit all Canadians, accelerate the government’s innovation and affordability agendas, and transition successfully into a 5G digital world, we need responsible, forward looking and predictable regulatory policy that ensures affordable, fair and expeditious access to this national asset so we can continue building our world-leading networks.”