Since the late 1990s, Industry Canada has used auctions as its preferred method to license valuable, scarce radio spectrum to new telecommunications and data communications carriers and to incumbent or existing service providers. While spectrum auctions have generally proven to be an effective way to equitably license spectrum, they have done so with varying degrees of success with respect to promoting greater competition in the telecommunications services market. The recently completed 2300 MHz and 3500 MHz spectrum auction demonstrated this dual effectiveness of auctions.

Although the 2300/3500 MHz auction was a financial bust for Industry Canada (total auction haul was a little more than $11 million), it proved to be a very effective method of licensing spectrum to both new entrants and smaller companies and to the incumbent communications service providers. It should also prove to be an efficient way of providing greater competition within the high-speed Internet access market for both the business and consumer market segments as it allowed several smaller communications service providers to acquire the resources necessary to expand their network footprints in an inexpensive fashion

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