Well this story just took a sad turn. Niagara Networks has withdrawn its $881M deposit and application for the upcoming wireless spectrum auction. This leaves just a few small new entrants such as the group led by John Bitove. Although Paul Allan is one of his investors, the group, called Data & Audio-Visual Enterprises Wireless Inc. is far less interesting as a new entrant as Niagara would have been simply because Bitove’s group has less of the spectrum to bid on and MUCH smaller budget.
Click here to read the story from the globe and mail and I’m sure the folks over at www.wirelessnorth.ca will have more of the scoop soon.
I’ve become resigned to the fact that we will not have a new national wireless carrier and therefore not have any significant change to the industry.
Maybe its time for me to dig out that old MVNO business plan and refresh it. I can resell some of the spectrum that is never going to get used:)
Tags: 3G, Canada Spectrum Auction, John Bitove, mobile, mobile data, Niagara Networks, Paul Allen, wireless
April 1, 2008 at 2:15 pm
While it’s true that DAVE has less spectrum that they can bid on, it doesn’t necessarily follow that they have less budget (and with Paul Allen on-board, the opposite could be the case). Consider that the amounts we’re seeing are only deposits, not the total budget for the auction bidders. In theory the auction bidders can and likely do have much deeper pockets than just their deposit amounts (which essentially amount to opening bids).
If I were an aspiring new entrant, I wouldn’t bid on all the spectrum – you don’t need all 6510 points to launch a national network (by far!). But I would bid on the strategically significant spectrum, which would hold a lower minimum deposit, and I would hold a lot of cash in reserve to be able to acquire that limited spectrum.
Maybe Niagara’s issue was that it bit off more than it can chew? Although that still doesn’t explain why they didn’t just scale down their application, rather than withdraw it completely.
You are certainly right though – this does take some of the fun out of it.