A pedestrian uses a mobile phone in front of a Wind Mobile location in Toronto on Tuesday, May 5, 2015.Darren Calabrese/The Globe and Mail
Wind Mobile Corp. has won government approval to sell licences for unused cellular airwaves to Manitoba Telecom Services Inc. and SaskTel.
Industry Canada issued approvals of the spectrum transfers Friday morning, granting Wind permission to transfer six licences to SaskTel and five licences to MTS.
MTS said it will pay Wind $45-million for the licences in Manitoba. SaskTel has not disclosed a price.
The new airwaves will "allow MTS to significantly increase the speed and customer experience on the MTS wireless network," the company said in a press release.
Wind Mobile said it would use the proceeds of the sale to expand its network – it plans to improve the quality of its existing 3G network and also launch LTE (long-term evolution or 4G) services.
All of the licences are in the advanced wireless services (AWS) spectrum band, which is the type of spectrum the federal government sold at a public auction in 2008, the first to reserve certain airwaves for new entrants to the market.
MTS and SaskTel, the incumbent telephone companies in their respective provinces, qualified as new entrants under Industry Canada's definition at the time.
Wind, which launched in 2009, did not build a network in either province, focusing instead on urban areas in Ontario, British Columbia and Alberta.
In granting the approvals Friday, Industry Canada noted that the transfers involve spectrum that is not being used but would be put to use by its new owners. It also said the transfers "would not significantly change the post-transfer concentration" of spectrum holdings in the provinces.
"[Industry Canada] has determined that the requested Licence Transfers will not impact the ability of existing or future competitors to provide services in the affected licence areas," it said in both approvals.
Wind has extra spectrum in the two provinces after Rogers Communications Inc. completed a spectrum option purchase from Shaw Communications Inc. and also bought Mobilicity last month.
That's because the transactions won approval from Industry Canada by including the transfer of a swath of spectrum licences to Wind Mobile, Ottawa's best hope for a sustainable fourth wireless player in Ontario, British Columbia and Alberta.
Prior to those transactions, Wind owned AWS1 spectrum licences in both Manitoba and Saskatchewan, but neither block of airwaves was directly next to – known as "contiguous to" – spectrum owned by MTS or SaskTel.
Having large blocks of contiguous spectrum makes it easier for cellular operators to deliver more bandwidth and faster speeds.
After last month's transactions, Wind owned 30 megahertz of AWS spectrum (or 15 MHz of "paired" upstream and downstream spectrum) directly next to the 20 MHz owned by MTS while it owned 20 MHz (10 MHz "paired") next to the 30 MHz SaskTel owns.
Wind CEO Alek Krstajic said the company paid $2 plus tax for the licence transfers that resulted from the Rogers transactions with Mobilicity and Shaw.