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Globalive withdraws from Canada’s 700 MHz spectrum auction

Globalive withdraw its hat from Canada’s highly anticipated 700 MHz spectrum auction just one day before the event was set to get under way. Globalive, which operates under the Wind Mobile brand in Canada, was the fifth previously qualified participant to forgo the proceedings.

Published reports indicated that Globalive’s move was due to a decision by its backer, Vimpelcom, to not fund Wind’s participation. Wind currently serves approximately 650,000 customers using 1.7/2.1 GHz airwaves it won during Canada’s 2008 spectrum auction.

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Stay tuned to RCR Wireless News for ongoing coverage of Canada’s 700 MHz spectrum auction

Vimpelcom, which controls Egyptian-based Orascom, which in turn has a 65% indirect ownership stake in Wind Mobile, has been looking to alter its ownership structure in Wind. Orascom announced last June that it was backing away from an attempt to consolidate its ownership in Wind Mobile, which followed changes in ownership rules that had previously prevented foreign ownership of controlling interests in Canadian carriers.

Globalive is reportedly involved in possibly buying assets from struggling rival Mobilicity, which last year was granted creditor protection from the Ontario Superior Court of Justice enabling the beleaguered company to seek out new funding. Mobilicity is controlled by Data & Audio-Visual Enterprise Holdings.

U.S.-based telecommunications giant Verizon Communications last year reportedly put in an $800 million bid to acquire Wind Mobile in an attempt to gain a foothold in the Canadian market prior to the planned 700 MHz auction. However, that move was squashed after Verizon announced plans to purchase Vodafone’s 45% stake in Verizon Wireless for $130 billion.

Industry Canada, which oversees wireless spectrum for the country, announced last month that four parties initially approved to participate in the 700 MHz auction had withdrawn, leaving just 11 bidders. The latest move by Wind whittles that down to just 10 bidders with the auction set to begin today. Remaining bidders include Rogers Communications, Bell Mobility and Telus Communications, as well as a handful of smaller, regional players including Saskatchewan Telecommunications, MTS and Videotron. Other qualified bidders include Bragg Communications, Feenix Wireless, Novus Wireless and TBayTel.

Industry Canada last June postponed the start date for the auction from Sept. 17 to Jan. 14.

Canada

Globalive’s move is expected to benefit Canada’s three largest telecom operators – Rogers, Bell Canada and Telus, which dominate that country’s mobile market. Industry Canada has been struggling to infuse new competition into the market, hopping to provide consumers with at least four choices in regards to mobile service across the country. Those initiatives have drawn criticism from the telecom giants claiming the market was not large enough to support more than three nationwide operators.

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