Bidding in Canada's wireless spectrum auction hits $4 billion
Jun 23, 2008
MONTREAL — Bidding reached $4 billion on Monday in an online auction aimed at creating more competition in Canada's cellphone market, surpassing early expectations of the amounts of money involved…
It shows the importance of the cellphone market and the belief that there's money to be made despite Canada's challenging geography and spread-out population, said Levy of Toronto's AR Communications Inc…
The auction means competition from other players for the three established cellphone players: Rogers Communications Inc. (TSX: RCI.B), Telus Communications Company (TSX:T) and BCE's Bell Mobility Inc. (TSX:CE).
The big three players were leading bidding on Monday, but they can't bid on the 40-megahertz of spectrum specifically reserved for new players in the cellphone market…
Goldberg said the new players, who can bid on all of the spectrum, are helping drive up prices.
"Their business plans still appear to be able to support the prices," said Goldberg of Toronto-area Mark Goldberg and Associates Inc. "It means that they must have some interesting and innovative services to offer for consumers."…
Consumers could also see some innovative pricing following the auction and likely more competitive prices and choice next summer…
Added Goldberg: "I'd say by next summer consumers are going to have more choice and more choice tends to mean more flexible price plans."…
Levy said Globalive, backed by European and Egyptian telecom companies, could emerge as the country's fourth major carrier…
The federal government has said the proceeds would be used to pay down the national debt…