Craig Wireless Systems Ltd. a Winnipeg-based company, said Friday it has sold all of its 2.5 Ghz Canadian spectrum to a consortium called Inukshuk, headed by two of the country's biggest incumbent wireless carriers.
The future of Craig's planned WiMax deployment in Palm Springs, Calif. isn't known. It also has spectrum interests through subsidiaries in Greece, Norway and New Zealand. A company executive couldn't be reached for comment.
Craig Wireless gave no explanation for the move, but it has been in financial trouble for years. "This sale is very supportive of the company's strategy to create value for shareholders through a portfolio of spectrum investments," Boyd Craig, who is co-CEO with is brother, Drew, said in a press release.
Craig Wireless operates fixed wireless Interent service in Vancouver and Winnipeg, Man., where the company is headquartered. It uses a proprietary fixed wireless system which the company has wanted to upgrade for years so it can increase subscribers.
Last September a company executive said a WiMax-based network using the 802.16e standard was under construction using equipment from Motorola Canada. In February the company said the network was up and would start commercial service early in the second quarter.
A Motorola Canada spokesman could not be reached for comment.
Craig Wireless is controlled by the Craig family, which has its roots in Canadian radio and television broadcasting with a company called Craig Media. However, that company had to sold in 2004 after debt mounted. The telecom assets were not part of that deal and became Craig Wireless.
It too, however, has been having trouble trying to build an international wireless business. According to its latest annual financial report, for the fiscal year ending Aug. 31, 2009 Craig Wireless had a net loss of CDN$10.9 million. On top of that, after an amalgamation of subsidiaries it carried an accumulated deficit of CDN$32 million, bringing the total to just over $43 million.
The company it sold its Canadian spectrum, Inukshuk, is a partnership of telco Bell Canada and cableco Rogers Communications Inc. They use the spectrum to give fixed wireless broadband to communities where their own wireline broadband can't reach.
Iain Grant, a Montreal-based telecommunications consultant, said that with the sale Inukshuk has almost a monopoly on the 2.5 Ghz spectrum in the country. the sale is proof that for the upcoming 700 Mhz spectrum auction the federal government should insist on setting aside spectrum for new entrants. It did that in 2008's AWS spectrum, resulting in eight new spectrum owners. One, Wind Mobile, has already started wireless service, while three are expected to open their doors before the summer ends.