Canadian License Fees for Fixed Point-to-Point Radio Systems

January 7th, 2019

Author: Andrew Moss, Product Manager, Wireless Broadband

Innovation, Science and Economic Development Canada (ISED) has finally decided to take another look at Fixed Microwave License Fees. The current RIC42 document, which has been in force since I’ve been involved in our industry, bases the costs on T-1 equivalency. So, the more T-1 (or equivalent) circuits you carry, the more you pay. This is irrespective of the amount of radio frequency (RF) spectrum your system occupies. For example, with a 10Gbs full-duplex radio, the yearly fee works out to about $131k per link.

There are certain spectrum efficiency minima in the SRSP (Standard Radio System Planner) documents which vary per-band, and whether sites fall within Moderate or High Congestion Zones (more on these later). But that’s really the extent of any encouragement to be an efficient spectrum user.

The proposed new fee structure will be based on the amount of RF spectrum occupied for a given PTP microwave link, with the licensee incentivized to use hardware that will make the most efficient use of each channel. (This I had suggested to ISED long before they were called ISED – and to employees whom have been retired for several years now. I’m sure I wasn’t the first.)

ISED references the spectrum management systems in the UK and Australia, not the USA

ISED says they looked at how the spectrum is managed in similar markets, namely the UK and Australia. Conspicuous by its absence is our closest market geographically, spectrally and arguably culturally, the United States. Given their comparatively very low cost of licensing a microwave link (as in $510 USD or thereabouts for 10 years) I find this oversight rather disingenuous. I suppose they could argue the USA is giving their resources away and the American people are paying the price. You could also counter-argue this is a public resource and everyone is benefitting from lower-cost, greater data bandwidth availability. Could the widely available unlimited cellular data plans in the US be connected to this somehow?

The UK on the other hand is a curious mix of higher population density, national telco monopoly and historically restrictive RF laws. I know of one UK manufacturer of microwave radios who can’t legally put their gear on the air in that country. I’m sure there are others. As for Australia the population scarcity is more closely akin to Canada, but the climate and geography are entirely different so I find it rather difficult to compare. Let’s hope the Minister of Transport doesn’t adopt similar research strategies for his next initiative otherwise we’re going to find ourselves driving on the left side of the road.

Self-Created spectrum Scarcity

ISED talks about their measures to promote efficiency in the spectrum by reducing RF bandwidth assignments and transmit power values and using more directional antennas. In practise what I’ve seen happen is licensees having to make do with lower-than needed data speeds while using antennas larger, and/or more expensive than what the baseline minimum design calls for or being forced up-spectrum to avoid the first two hurdles and suffering in overall availability as a result. I call this self-created spectrum scarcity. A simple solution would be the availability of more microwave bands. Another solution is much tighter band-plans that exploit new technologies’ ability to mitigate interference. This is really a discussion aimed more at the SRSP documents than license fees. Suffice to say there is in my opinion much room for optimization here.

 Proposed Consumption-Based PTP Fee Model Coming Soon in 2020…?

Significant fee reductions are proposed – why do we have to wait a full year? We’ve waited more than a decade for a more logical and fairer fee structure, there is no need to wait any longer. This isn’t legalizing marijuana, there is no potential social fall-out from making such an abrupt and positive change to fees.


Near the end of the document, ISED mentions that each leg of a Point to Multi-point system will be treated as a separate PTP link and charged license fees accordingly. I know from experience in attempting to put a PTMP system on the air in an atypical band that the fees don’t work. This is especially true of the current fee structure, but still very much so given the new. I’m guessing ISED considers this type of system to be a “band hog” and inefficient. I’m certain any given WISP would disagree.

I also must wonder how new technology high-speed 26/28GHz products from the likes of CommScope and CBNL could possibly prove cost effective under this structure? Almost all PTMP base station antennas fall into the sectoral type with typical 30-90° coverage patterns. These antennas have far lower gain than parabolic dishes and new trending technologies like LTE make it possible to synchronize everything to avoid creating self-interference. ISED talks about rewarding efficient use of spectrum and this needs to apply to PTMP systems too. Can you imagine the cost of smartphones if the same fee structure applied to them?

I don’t know what the answer is but given it could successfully be argued more terminal radios tied to any one base station is more efficient, that this should play into the formula. An easy way would be to just consider all terminals to be one end of a PTP link. After all, the base station is only going to hear any one of them at a time (okay, I know MIMO radios are smarter than this but I think you know what I’m saying).

Rural PTP Deployments

I’m not averse to the fee model they’ve come up with. There’s a lot that’s good about it and I agree it is a trade-off between many considerations. However, I think there should be another factor in the equation. One that deals with rural PTP deployments. These should be discounted over those within the High and Moderate Congestion Zones which ISED has long established. Perhaps by a factor of 50% to reflect the opportunity to facilitate high-speed Internet in keeping with the federal initiatives to connect Canadians. Keeping costs reasonable is a constant challenge for every independent WISP I’ve spoken with. These people are the unsung heroes of broadband Internet outside of the urban centres. They don’t need more encouragement to keep doing the right thing, they need a financial break to help them do it even better. Of course, there are other low-revenue, and not-for-profit entities that could really benefit from this approach at the municipal and community levels.

Uni-directional Links

Uni-directional links are addressed in the fee structure with the example of a broadcast STL (studio transmitter link). This is really the only application I can think of where this is applicable. That said, I’ve personally been involved in replacing many STL with bi-directional microwave links which are superior in so many ways. What I didn’t see addressed is how half-duplex (aka TDD) systems are to be charged for? They are technically using only one half of the regular fixed spectrum, so perhaps they should be charged only half that of the more conventional full-duplex PTP link? Admittedly there isn’t a lot of equipment of this type available, but I have seen some. And of course, much license-exempt gear is of the TDD type and converting to licensed frequency bands is likely an easier path for manufacturers than an entirely new design and build.

A Step in the Right Direction

Overall, I do think this move by ISED is a big step in the right direction. In case it wasn’t obvious I would’ve liked to have seen the license fees even lower than those proposed. I’m not holding my breath that they’ll consider doing that, but I think it’s likely they won’t be any more expensive, which is good news for Canadians.