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Canada Emerging at the Forefront of LTE

Canada has made impressive progress in mobile broadband deployment in recent months. This is partly due to operators needing to arrest falls in revenue from mobile voice services by buttressing their data capabilities, as also by the stimulus to the market introduced through the auction of Advanced Wireless Services spectrum in 2008. This auction overhauled the wireless market, introducing a number of smaller players which have added to the competitive mix as well as furthered the development of LTE.

Despite provisions to encourage new markets entrants, the major auction winners were, unsurprisingly, Rogers, TELUS and Bell Mobility, together accounting for around 60% of the spectrum available. Nevertheless, five new entrants also received spectrum. Four of these have since launched services. Notably, Shaw Communications decided against investing in a wireless network which it predicted could have cost up to CAN$1 billion. Instead, it has favoured developing a cheaper WiFi solution (costing perhaps CAN$400 million). The company recently sold its remaining wireless assets, though is continuing to sit on its awarded spectrum. The WiFi network is unlikely to generate much revenue, and so its true value may lie in providing access to it to mobile network operators needing to offload data from their LTE and HSPA infrastructure.

Meanwhile, mobile broadband services are fast expanding across the country. Rogers and Bell Canada have launched commercial LTE services in a number of major cities, , with the top 25 markets to follow during 2012 (so reaching half of the population). Outside of the LTE footprint customers are provisioned with HSPA+ which covers about 96% of the population. Both companies expected to extend their LTE coverage to rural areas pending the government’s decision on the 700MHz spectrum auction: Telus also planned to extend its LTE network to cover 25 million Canadians by the end of 2012, while the regional telco SaskTel will follow its initial launch (in Regina and Saskatoon) to other urban and rural areas from 2013 based on demand.

By Henry Lancaster, Senior Analysts at Paul Budde Communication

Henry is also a contributor of the Paul Budde Communication blog located here.

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