700Mhz Auction AKA Time to Nationalize the Wireless Industry?

The Federal Government recently announced some more details of the 700Mhz spectrum auction that is scheduled for this year, which is kind of interesting.

I can remember a time when using a modem on a residential phone line was not allowed by Bell Canada so I’m no fan of incumbent, monopolistic telephone companies, but is having “competition” better when it really isn’t competition at all?

The wireless industry has been moving along under the “free market” banner for years but real competition has yet to arrive in a meaningful way for most Canadians (yes, Wind and other new entrants bring some competition to the table, but are limited in the coverage).  When the telephone companies first start to appear it was quickly realized that having multiple companies run phones lines to homes didn’t make much sense.  The solution was to give a monopoly to one company per area of service and then force them all to interoperate with each other.

This actually worked pretty well to begin with as the industry grew and only started to fall off the rails when new technology came along that threatened the status quo.  The monopolies of course tried to kill the new tech, but eventually failed to do so.

So why haven’t we realized that building three or four wireless networks to do the same thing is a waste as well?  Ok, sure, when there were competing standards (CDMA and GSM) there was an argument to be made to support multiple networks, but LTE has won.  There is only one standard and maybe now its time to rethink how we license wireless operators.

Let’s face it, many of the ‘tricks’ wireless providers use today to keep people on their networks (long term financing of phones, locked hardware, limited hardware options) look a lot like what the phone company use to do as well.  Could a hybrid model be created that would reduce the cost of the infrastructure and spurs competition as well?

I think its possible.  Nationalize the underlying network, build one set of towers and run it as a monopoly with regulations that require open access.  Then providers like Bell, Rogers and Telus can offer services on top of the network (access to the phone network, the internet, their own content, etc.), forcing them to complete on price and features instead of which phones they have.  This would allow smaller providers like Wind to compete on a level playing field instead of having to spend years building out infrastructure and spending billions on spectrum and roaming agreements.

In the end, just like with telephone service, national wireless coverage is the goal and duplicating the effort two, three or four times is just a waste of money that end users have to pay for through higher monthly bills.

Greg

Greg

Greg is the head cat at JumbleCat, with over 20 years of experience in the computer field, he has done everything from programming to hardware solutions. You can contact Greg via the contact form on the main menu above.

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Greg

Greg

Greg is the head cat at JumbleCat, with over 20 years of experience in the computer field, he has done everything from programming to hardware solutions. You can contact Greg via the contact form on the main menu above.