Spectrum Auction Rules and Competition Policy

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This paper addresses the Canadian government's controversial limits (or caps) on the blocks of spectrum that can be acquired for the upcoming auction of 700 MHz spectrum on January 14, 2014. Large Canadian carriers (TELUS, Bell, and Rogers) have expressed concern over Verizon's possible participation in the auction. While the perceived scenario of Verizon acquiring one or more smaller wireless carriers and then successfully bidding for prime spectrum has garnered national attention, the broader issue of whether the policies being implemented by the government are in the interests of Canadian wireless customers is equally significant. This paper argues that preventing large incumbent carriers from unduly restricting competition in the future can and should be addressed through the Competition Act, rather than through "handicapping" the competitive process, including spectrum auction caps.

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