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Consequences of High Spectrum Costs

The cost of spectrum is a central factor in the higher wireless bills for Canadian customers relative to customers around the world. Auction design and company behaviour in past auctions pushed prices for Canadian wireless spectrum higher. These high upfront fees coupled with provider’s internal financing restraints can result in lower network re-investment and higher consumer prices.

To address these challenges, policymakers should avoid high minimum auction prices, sluggish or unclear schedules for release of new spectrum, fragmented packaging of spectrum for auction, and auction rules that encourage bidding wars (e.g., opaque auction rounds, lack of spectrum caps).