Canadian government opens up market

15 March 2012 | Kavit Majithia

The Canadian government has taken a major step to liberalising its telecoms market after scrapping foreign ownership limits on carriers which own less than 10% market share.

Proposed changes are also likely to benefit smaller operators which will have access to additional capital and spectrum, which the government will reserve for those companies with less reach in the market.

Industry minister, Christian Paradis said the government would auction 700MHz and 2.5GHz of wireless spectrum in the first half of next year. Meanwhile, caps will be imposed on larger operators, and companies that acquire two or more blocks of spectrum will be obligated to serve rural communities.

The government has previously been criticised by the industry for being too timid, particularly in regards to foreign investment, and its regulation regarding telecoms has come under more scrutiny recently after electing a majority government.

“It’s certainly an interesting place to start,” said Carmi Levy, an independent analyst. “If the government was going to move towards loosening the rules, this is probably the most balanced way to do it. It starts us down the road of greater foreign ownership in the telecom space but at the same time it attempts to protect the incumbent players.”

Canadian regulation has also often been critiscised for moving too slowly for network roll-outs, and the government insisted on a revision of policy for roaming and tower sharing to encourage quicker developments.