Last month, Canada’s Innovation, Science, and Economic Development Minister Navdeep Bains announced the delay of the 3500MHz spectrum auction to June 2021.
Ottawa has postponed the 3500 MHz spectrum auction by 6 months due to the pandemic; bidding now slated to start June 15, 2021. #telecom— Alexandra Posadzki (@alexposadzki) June 5, 2020
The ministry’s official press release states that the decision for postponing the auction is to allow telecom service providers to focus on “providing essential services to Canadians” during the pandemic.
5G Spectrum in Canada
The auction was initially set for December 2020, where there would be 1,506 licences available in the 3500MHz spectrum that will be spread across Canada. Acquired licenses would be valid for 20 years. The country would be divided into 172 geographic regions with varying amounts of spectrum available for each.
The 3500MHz spectrum auction was especially important because the rollout of 5G networks depends largely on when companies manage to acquire more spectrum. In general, 5G operates over various traditional and new cell radio frequency bands including low, mid, and millimetre-wave (mmWave) ranges.
While mmWave has gotten the most attention due to its multi-gigabit speeds, it’s easily obstructed and has short range. That’s why mid-range bands like 3500MHz are key for both urban and rural 5G deployments because they can better travel for long distances and pass through buildings.
5G and COVID-19
2020 was meant to be the year of 5G. With the incredible hype around the fifth generation mobile network technology, the networking community has been gearing up for wide-scale deployment this year. Then the coronavirus pandemic hit.
The pandemic has left telcos in a tight spot. With decreased sales and an exponential increase in demand for connectivity that happened almost overnight, the disruptions caused by COVID-19 are certainly having a negative impact on Canadian wireless companies’ revenues and they’d have to re-assess their financial estimates and priorities for the year.
To fully realize the innovative opportunities of 5G, massive investment in new wireless spectrum, technology and infrastructure is required. The delayed 5G auction was going to be quite expensive for the whole telecom industry.
Accenture estimated that Canadian carriers will spend around $17.6 billion on spectrum auctions to make 5G deployments a reality. This doesn’t account for the projected $26 billion investment in 5G infrastructure between 2020 and 2026.
While major wireless carriers prepared for the auction by setting a significant amount of capital, they can now take a breather and use that extra capital to make it through what could be a rough rest of the year.
Why Does 5G Matter in Canada?
Postponing the 5G auction for six months would not be detrimental to Canada’s technological and economic development. However, delaying 5G network deployments by more than a year might mean the country will start falling behind.
Prior to coronavirus and the radical changes that happened in our world, the excitement for 5G on the consumer side was mainly because of its novelty as a faster wireless technology. Now as home broadband service becomes critical in this era of physical distancing, 5G advancements are a lot more than just novelty. Consumers now can grasp the impact of 5G’s higher capacity, faster speeds, and lower latency for applications such as video conferencing, telemedicine, and virtual & augmented reality.
Internet-of-Things (IoT) devices are one of the main game-changing opportunities of 5G. 5G’s impact on things like precision agriculture, predictive maintenance in the Oil Sands, immersive entertainment, connected ambulances, or smart city/home/business applications can truly reinvent high-value production, emergency service, and work connectivity.
With speculations of an impending recession, economic stakes are high for 5G deployment. Technological advancement, connectivity and automation are now key factors in remaining globally competitive. That’s why 5G connectivity is vital to Canadian manufacturers, energy companies, and agricultural producers. What’s more, 5G deployment is projected to inject $40 billion into the Canadian national GDP and create 250,000 jobs.
The Future of 5G
The coronavirus pandemic might have shaken up the world, but it truly cemented the role of connectivity in our lives. Prior to COVID-19, Ericsson’s forecasts indicated that by 2024 there would be 1.9 billion 5G mobile subscriptions and 22 billion connected IoT devices. According to their June 2020 report, those numbers rose to 2.8 billion 5G subscriptions and 24.6 billion connected IoT devices by 2025, showing that the pandemic will likely accelerate 5G adoption, not slow it down.
Some initial test cases of 5G have been rolled around the world. While there might be some first-to-market advantages, there’s usually a lot of question marks about new technologies like 5G in their early stages. That’s why the 5G auction delay may help deliver better connectivity at the end of the day.
As the world slowly heads to a new normal, Canada needs to stay on top of the 5G connectivity game to deliver the promised lightning speed and rapid-fire responsiveness. At BLiNQ Networks, we’re at the forefront of 5G-ready technology. Our 5G Massive MIMO Small Cells with beamforming technology are built for future-proof deployments. Talk to us today to learn more about our 5G fixed wireless solutions.