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4 April 2003 Mr. Jan Skora Director General Radiocommunications And 4 April 2003 Mr. Jan Skora Director General Radiocommunications and Broadcasting Regulatory Branch 300 Slater Street Ottawa, Ontario K1A 0C8 Don Woodford Director - Government & Dear Mr. Skora: Regulatory Affairs Subject: Bell Wireless Alliance Comments in response to - Consultation on a New Fee and Licensing Regime for Cellular and Incumbent Personal Communications Services (PCS) Licensees, Canada Gazette - Part 1, Notice No. DGRB-004-02, dated 21 December 2002. 1. Bell Mobility, on behalf of the Bell Wireless Alliance (BWA), is pleased to submit the following comments in response to Industry Canada's Consultation on a new fee and licensing regime for cellular and incumbent PCS licensees. 2. The Bell Wireless Alliance consists of Aliant Telecom Inc. (Aliant), Bell Mobility Inc. (Bell Mobility), MTS Communications Inc. (MTS), MTT Mobility Inc., Northwestel Mobility Inc. and Saskatchewan Telecommunications (SaskTel) and, for the purposes of these reply comments, the Corporation of the City of Thunder Bay. 3. If you have any questions concerning the attached please feel free to contact me at (819) 773-5575. Yours truly, Attachment Bell Mobility 105, rue Hôtel-de-Ville 5e étage Hull (Québec) J8X 4H7 Tel: (819) 773-5575 Fax: (819) 773-4346 Internet ID: [email protected] Canada Gazette Notice No. DGRB-004-02 Consultation on a New Fee and Licensing Regime for Cellular and Incumbent Personal Communications Services (PCS) Licensees Published in the Canada Gazette, Part 1 dated 21 December 2002 Bell Wireless Alliance Reply Comments on behalf of Aliant Telecom Inc., Bell Mobility Inc., MTS Communications Inc., MTT Mobility Inc. Northwestel Mobility Inc. Saskatchewan Telecommunications and The Corporation of the City of Thunder Bay 4 April 2003 Table of Contents Page EXECUTIVE SUMMARY ..............................................................................................................1 1.0 INTRODUCTION...............................................................................................................2 2.0 THE PROPOSED LICENSING REGIME ..........................................................................3 3.0 THE PROPOSED FEE......................................................................................................4 4.0 OTHER ISSUES...............................................................................................................6 4.1 Proposal to Re-Regulate the Wireless Industry.....................................................6 4.2 Request for Mandated Site Sharing ......................................................................7 4.3 Request for a "quick fix" for PCS Fees..................................................................7 4.4 System Access Fee...............................................................................................8 4.5 Radio Station Installations.....................................................................................9 5.0 CONCLUSION ..................................................................................................................9 EXECUTIVE SUMMARY 1. In its Comments in response to Industry Canada's Consultation the BWA noted that, while it was in general agreement with the proposed harmonized licensing regime, the proposed rate of $0.052 per MHz per person is excessively high. The BWA further noted that implementation of the new regime at this rate would not be in the best interests of Canadian wireless consumers or the industry overall. The proposed rate would be particularly hard on those wireless service providers (WSPs) attempting to extend service in areas characterized by smaller population concentrations. 2. The BWA notes that it found wide spread agreement with that view in the majority of filed comments. Moreover the supporting rationale for the view, delineated by those parties, was very similar to that put forward in the BWA's Comments. These reasons primarily relate to: the developing negative economic climate; the economic circumstances facing the Canadian wireless telecommunications industry specifically; and enunciated federal government policy governing the application of user fees, which requires that all federally imposed financial obligations be taken into consideration. The federal government policy also requires that the impact of any fee changes, on the sector in question, be thoroughly assessed before they are implemented. 3. The BWA also notes the comments of Information Technology Association of Canada (ITAC) to the effect that it believes that Industry Canada, by reducing cellular and Personal Communications Services (PCS) fees, should endeavour to stimulate an environment that is conducive to innovation and one which facilitates the rapid deployment of productivity-enhancing technologies, such as the wireless infrastructure, across all sectors of the Canadian economy. The BWA submits that its proposed fee of $0.02 per MHz per person would achieve such an effect and still provide Canadians with a fair return for the use of their resource. 4. The BWA reiterates its view that this Consultation represents the Department's sincere effort to determine the validity of the assumptions used in its modelling exercise so as to arrive at a rate that is both fair and equitable and one that encourages the development of this strategically enabling infrastructure. 5. As indicated in its Comments, the BWA is prepared to provide any additional information the Department deems useful to arrive at this result. - 2 - 1.0 INTRODUCTION 6. Bell Mobility, on behalf of the Bell Wireless Alliance (BWA), is pleased to submit the following reply comments in response to Notice No. DGRB-004-02 – Consultation on a New Fee and Licensing Regime for Cellular and Incumbent Personal Communications Services (PCS) Licensees, as published in the Canada Gazette, Part 1, dated 21 December 2002 (the Consultation) and as modified by Canada Gazette Notice DGRB-001-03, dated 21 February 2003. 7. The BWA submitted comments in response to the Consultation on 14 March 2003 (the BWA Comments or its Comments). 8. The BWA consists of Aliant Telecom Inc. (Aliant), Bell Mobility Inc. (Bell Mobility), MTS Communications Inc. (MTS), MTT Mobility Inc., Northwestel Mobility Inc. and Saskatchewan Telecommunications (SaskTel) and, for the purposes of these reply comments, the Corporation of the City of Thunder Bay. 9. In its Comments the BWA noted that, while it was in general agreement with the proposed harmonized licensing regime, the proposed rate of $0.052 per MHz per person is excessively high and that implementation of the new fee regime at this rate would not be in the best interests of Canadian wireless consumers or the industry overall. 10. The BWA notes that, in addition to the Canadian Wireless Telecommunications Association (CWTA), the submissions of all four of Canada's primary cellular and Personal Communications Services (PCS) licensees, including that of Microcell Telecommunications Inc. (Microcell) which is not currently a CWTA member, were of essentially the same view. 11. In the following reply comments, the BWA will address the essential issues that in its view have arisen in the comments posted on Industry Canada's Strategis website in response to the Consultation. In the BWA's view these include issues related to the shift to a proposed spectrum licensing regime and the proposed harmonized licence fee. Finally, the BWA will address certain specific issues raised in the comments of other parties. 12. The absence of BWA reply in response to any specific comment, which is contrary to the interests of the BWA, should not be construed as agreement with such comment. - 3 - 2.0 THE PROPOSED LICENSING REGIME 13. In its Consultation, Industry Canada (Industry Canada or the Department) proposes to harmonize the licensing regime applicable to all incumbent cellular and PCS licensees, many of whose current spectrum holdings include radio or apparatus-based licences, to one of spectrum-based licensing on a geographic basis. In addition to eliminating the requirement for licensing on a radio station basis, spectrum licensing would also provide licensees with enhanced licence rights including extended license terms and the ability to divide and transfer spectrum in the secondary market. 14. The BWA notes that virtually all parties agreed with the proposed move to a spectrum-based licensing regime. 15. The BWA noted, that "...it is generally supportive of the proposal to harmonize the disparate fee and licensing regimes applicable to cellular and PCS spectrum."1 Rogers Wireless Inc. (RWI) noted that "RWI is in favour of the timing of the proposed new fee and licensing regime."2 TELUS Mobility (TELUS) states that it "...supports the Department's proposal to align all cellular and PCS spectrum with respect to transferability and divisibility."3 Microcell notes that it "...is in agreement with the Licensing Consultation proposal to replace the current system of site-by-site radio station licences with a spectrum licence regime."4 16. Based on its review of the comments submitted to Industry Canada, the BWA concludes that the majority of cellular and PCS licensees, including the four entities operating as national carriers, agree with the proposed change from an apparatus-based licensing regime to a spectrum licensing regime. 1 BWA comments in response to Canada Gazette Notice DGRB-004-02, Consultation on a New Fee and Licensing Regime for Cellular and Incumbent Personal Communications Services (PCS) Licensees, 14 March 2003,
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