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Canadian Government Authorizes Spectrum Licensing Toward Development Of New Satellites

By | June 18, 2007

      In the Canadian government’s sponsoring its largest-ever spectrum licensing initiative to develop new satellites and increase and improve broadcasting and telecommunications services to Canadian entrepreneurs and consumers, Industry Canada has awarded 12 new licenses to two operators, the government announced June 13.

      Among those licenses for satellite airwave spectrum, more than half went to the market’s newest player, Ciel Satellite Communications Inc. (Ciel).

      Though Ciel has but one satellite in orbit, the operator was awarded seven additional licenses for satellite spectrum used for new telecommunications, broadband and television services including high-definition (HD) programs. The other five licenses were furnished to Telesat Canada (Telesat), which has seven in-orbit satellites with two more under construction.

      Combined, the two satellite operators plan to orbit 10 new satellites. Neither Ciel nor Telesat, which owner BCE Inc. has agreed to sell to combine with Loral Space & Communications Inc. (Loral), responded for comment.

      "Canada needs to increase its satellite capacity to keep pace with the ever-increasing demand for satellite services," said Minister of Industry Maxime Bernier during a press conference at the 2007 Canadian Telecom Summit in Toronto.

      "By awarding these new licences," he added, "we are helping the expansion of satellite capacity and services that will benefit Canadians for years to come. We’re helping to foster an environment that will bring all the benefits of competition, including increased product and service offerings, choice in supplier, competitive prices and export revenues."

      Ciel and Telesat each indicated plans to invest several billion dollars in building and launching satellites to fully implement high-definition television (HDTV) and Internet protocol television (IPTV) in Canada along with new and advanced telecommunications services such as satellite Internet. The first of the new satellites are expected to be operational as early as 2010.

      "The result of the licensing initiative will provide the capacity needed to increase and improve broadcasting and telecommunications services to Canadian entrepreneurs and consumers," Bernier said.

      In a country where approximately three-quarters of the population live within 90 miles of its southern border, for example, high-speed Internet services offered by satellite companies are popular with rural residents.

      Satellites are also critical to providing broadcasting and telecommunication services, particularly in the north where they are the key link to the delivery of public safety, national security and government services. Increased capacity is also required as more people switch from analog systems to digital TV and HD services offered by satellite and cable companies.

      Last July, the Canadian government kicked off the satellite spectrum process by putting 29 licenses on the block and choosing winners on the basis of their applications rather than by auction bidding, Though only the 12 licenses (which Ciel and Telesat will pay fees for) have thus been picked up, Industry Canada expects to start a new process later in the year to issue the remaining 17 licenses. Selected applicants are expected to direct 2 percent of their future operating revenues to fund special initiatives for improving access to telecommunications services in underserved communities.

      In November, Ciel filed nine applications with Industry Canada for multiple satellite orbital positions across several frequencies. Based in Ottawa, Ciel is a Canadian-owned and controlled satellite operator with a combination of partners, including BPC Telecommunications Corp., a company controlled by Borealis Infrastructure and part of the Omers Pension Plan‘s group of companies; Canadian satellite pioneer Brian Neill and SES Americom, an SES company.

      Last December, Loral and its Canadian partner, the Public Sector Pension Investment Board (PSP Investments), entered into a definitive agreement with BCE Inc. to acquire 100 percent of the stock of Telesat. In January, Telesat awarded Space Systems/Loral, a subsidiary of Loral, a contract to manufacture Nimiq 5, Telesat’s new high- power, direct broadcast satellite planned for operation in 2009.

      Based on SS/L’s 1300 platform, the satellite will be equipped with 32 active high-power Ku-band transponders, providing a strong footprint across Canada. Nimiq 5 will have a lifespan of more than 15 years, operating in its geostationary orbit location of 72.7 degrees West.

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