CONFIDENTIAL CLIENT: Spectrum Valuation

Valuation of spectrum holdings and strategies for best economic use for a CALA wireless operator.

• Nordicity was engaged by a CALA region wireless operator to
• Undertake a valuation of the firm's spectrum licenses and,
• Develop strategies for increasing the value of the 3.5GHz licenses for the company.

Industry Canada: Study on the Global Practices for Assigning Satellite Licences and Other Elements

This study examined of the practices of other countries for assigning satellite licences and other elements. It examined licensing processes in terms of:

• Assignment processes;
• Pre-launch eligibility requirements;
• Post-launch conditions and obligations;
• Control mechanisms and safeguards;
• Historical changes and alternative processes; and
• Practices for licensing foreign satellites.

The final report identified best practices and provided recommendations and options on what licensing approach Industry Canada should follow when there is competing demand.

2009

Telecommunications Authority of Trinidad and Tobago (TATT): Design of Trinidadian BWA Auction Rules, Processes, Bidders' Documentation and Auction Management

The Telecoms Authority of Trinidad and Tobago (TATT) hired PwC Trinidad and its associated firms Nordicity and Fasken-Martineau to design and execute a simultaneous, multiple-round (SMR) auction of auction of broadband wireless access (BWA) spectrum in April 09.

The successful conclusion of this 2nd BWA Auction resulted in the licensing of 26 blocks in 3 bands: 700MHz, 2.3GHz and 2.5GHz to three bidders: Digicel (Ireland), TSTT (owned by the government & Cable & Wireless) and Green Dot (Trinidad). The final auction prices obtained in this auction will provide key reference points for spectrum license fees as well as for setting the reserve price in future auctions.

2008

Porta (subsidiary of América Móvil): License renewal for mobile telephony

Nordicity advised Ecuadorian mobile operator Porta (subsidiary of América Móvil) in its negotiations with the national government on the fee for renewing its license for mobile telephony. The attached report (in Spanish) was filed with the government's negotiating commission on the license renewal. During the negotiations, the government commission performed an evaluation of Porta's business, but would not let Porta examine the valuation model, except for a brief presentation. Our report performs a reverse-engineering of the government's valuation model and highlights the unreasonable assumptions that had to have been employed.

2007

Telecommunications Services of Trinidad & Tobago: Bidding strategy for Broadband Wireless Access spectrum auction

Advised on bidding strategy for Broadband Wireless Access spectrum auction (700MHz, 2300 MHz, 2500 Mhz). This required combining the valuation the company had for the operations it planned for these bands with an analysis of the valuations of the other bidders and devising an auction strategy. As a result, TSTT was able to bid successfully for additional spectrum in the 700 MHz and 2500 MHz bands.

2006

Communications and Information Technology Commission (Saudi Arabia): STC Reference Interconnection Offer (RIO) Benchmarking Study and Draft Tariff Decision Project / Remedies for Non-Performance in the Delivery and Maintenance of Interconnection Services;

Nordicity undertook a multiple studies for CITC. The RIO study included benchmarking of interconnection tariffs in 18 best practice jurisdictions, analysis of STC's original interim and revised RIO proposals including costing data and other justification, analysis of interveners' submissions to the Public Consultation process and drafting recommendations for the RIO tariff decision.

The second study addresses the issues relating to the quality of interconnection services delivery and maintenance. These issues include:

• The framework by which such delivery and maintenance can be assessed by the regulator and;
• Any remedies for non-performance to ensure that the incumbent responds appropriately to service/maintenance requests from the new entrant(s).

The results of these projects enabled CITC decisions on interconnection pricing and future requirements for costing information from applicants. In addition, Nordicity provided support to the CITC during its negotiations with the incumbent, in arriving at its final decision on interconnection tariffs.

Conatel: Market assessment of broadcasting and broadband services for satellite carriage

Nordicity advised national telecommunications regulator on the valuation of 10MHz in the 1900 MHz band. A report was prepared, but it is not available. The members of the regulatory body for which the valuation was prepared were all part of the previous government of Ecuador, which is no longer in office, and these persons all left with the change of government. The methodology employed for valuation of the PCS spectrum was a discounted cash flow of a hypothetical mobile operator. It was used to set a minimum bid amount for spectrum being acquired by the existing mobile operators. It was also used as a reference point in the negotiations between the mobile operators and the then national government for renewal of the cellular and PCS licenses they held.

Ciel Satellite Inc: Market assessment of broadcasting and broadband services for satellite carriage

Nordicity was mandated to undertake an assessment of the Canadian demand for two distinct market segments: broadcasting services, primarily the launch of and conversion to HDTV; and broadband Internet services to the underserved communities in Canada. This project was commissioned by one of the leading applicants for spectrum in a major comparative review process for allocating space spectrum in the C, ku, and ka frequency bands for the exploitation of orbital positions in spectrum under Canada's jurisdiction. Nordicity conducted industry interviews, researched available documentation, and developed assumptions for estimating demand over a 10-year period. Nordicity further developed regulatory and policy scenarios, examined technological developments and consumer trends, and simulated broadcaster and DTH platform provider decision-making to derive the forecasts.

Midi-Sat (South Africa); Application for Subscriber Television Service in South Africa

In summer 2006, Midi-Sat (South Africa) engaged Nordicity to assist it in the preparation of its application for a satellite-based subscriber television service in South Africa. Nordicity was involved in all aspects all the application-development process, including the preparation of the technical plan, subscriber forecasts, and business plan.

Selected Previous Engagements (pre-2006)

Department of Canadian Heritage (subcontractor to PricewaterhouseCoopers): Methodologies for the Valuation of Broadcasting Licences

The Department of Canadian Heritage engaged PricewaterhouseCoopers and Nordicity to prepare a report on the methodologies that can be used to estimate the value of broadcasting licences in Canada.

Client: CONFIDENTIAL: Forbearance in Local Telecommunications in Canada – Economics Assistance

Nordicity provided economics research and analysis to a Canadian telecommunications that was an intervener in CRTC's public process to develop framework for forbearance in local telecommunication in Canada.

TecKnologies and Enterprises Development Company Limited (e TecK): Business Planning

For Evolving TecKnologies and Enterprise Development Company Limited (e TecK) a Trinidadian company, Nordicity and PwC Trinidad undertook business planning (including financial, economic, technical and market analysis) of existing and new industrial parks in Trinidad.

Telecommunications Authority of Trinidad and Tobago and Ministry of Public Administration and Information: Develop and Implement a Modern Frequency Spectrum Management System

Nordicity assisted MPAI in conducting consultations with major stakeholders and interest groups to ascertain current spectrum usage, interference issues, potential future applications of wireless systems and demand for radio and broadband services. This included public and private interests, government, military, public safety, carrier(s), broadcasters, ISPs and the oil and gas sector.

Cyprus Ministry of Communications and Works: Comparative Analysis of Licensing Methods and Number of Licenses / Methodology for the Setting of a Reserve Price for Spectrum Auction in the Context of the Licensing of a New Wireless Operator in Cyprus / Spectrum Monitoring –Study of System Design, Measurement Procedures and Reports;

To assist the CMCW in licensing new cellular services, Nordicity principals (with PwC) undertook the following tasks:

• Prepared a New Spectrum License Fee Model based on analysis of business processes, work effort, costing;
• Recommended a reserve price for the auction of new cellular license concessions;
• Undertook market capacity study to identify the optimal number new cellular GSM operators;
• Prepared tenders for the licensing of new operator(s).

Botswana Telecommunications Authority (BTA): Per Second Billing / Design Blueprint

Nordicity principals undertook two studies for the BTA. One to provide the authority with an assessment of the proposal by the Botswana Telecommunications Corporation (BTC) for the implementation of Per Second Billing (PSB).

Vodacom South Africa: Spectrum Efficiency and Benchmarking Study

The client requested Nordicity principals to perform a spectrum efficiency comparison of Vodacom's use of the 900 MHz band, for its GSM network, in the three main South African metropolitan areas of Johannesburg, Cape Town, and Durban, with comparable cities world-wide utilising the GSM system. Hofmeyr, Herbsteyn, Gilhwala, and Vodacom hoped to use the report in their bid with the South African regulator, the Independent Communications Authority of South Africa (ICASA), for additional spectrum in the 1800 MHz band.

Partner Communications Ltd: Market Assessment Summary

Partner Communications Ltd. (Partner) was considering the business opportunity associated with the introduction of competition in the domestic voice and data markets in Israel and most specifically with the near term plans by the Israeli Ministry of Communications to auction spectrum in the LMDS and WLL frequency bands.

SkyCable Inc: Assistance with Regulatory Applications

Nordicity`s principal developed SkyCable's regulatory applications for wireless cable television and broadband Internet distribution licenses for two provincial regions in Canada. The work included market research, analysis and forecasts, a business plan and financial model and regulatory advice and preparation for CRTC hearings such as deficiency responses, interventions and coaching.

Bird Satellite Communications Inc: Assessment of the North American Satellite Market

Bird Satellite Communications Inc. submitted an application to Industry Canada for a licence to operate a satellite in the 118.7 W orbital slot. As part of the preparation of this application, Bird Satellite engaged Nordicity principal to conduct an assessment of the North American satellite-services market.

Zero Limits N.V (ZL): Investment Strategy in Curacao

For Zero Limits N.V., a Curacao telecoms firm, Nordicity principal developed a business model to evaluate demand and financial feasibility in the Netherlands Antilles for reselling of bandwidth (full and partial circuits) with specific QoS, pricing and value-added services (managed data network services, 1-800, hosting, VOD, etc.).

Futureway Communications Inc: Review of Average Subscriber Cost Comparisons

Nordicity principal was engaged by Futureway Communications Inc. (FCI) to review average subscriber cost comparisons. The cost comparisons are intended to reflect the cost of three technologies, cable upgraded to provide voice, telephone upgraded with ADSL to provide high speed data, and FCI's technology, on the basis of a green-field installation of a sub-division with 554 homes.

Craig Wireless International Inc; Broadband Wireless: Industry and Economic Trends Relating to WCS Spectrum

The study undertaken by Nordicity principal traced the history of Wireless Communications Services (WCS) spectrum in North America and explored the economic demand and supply trends driving the evolution of new services in the 2.3 GHz frequency band. The study report was submitted by the client for publication by Industry Canada.

Telesystem International Wireless; Validation of Assumptions Supporting the TIW Vision

TIW successfully implemented its global wireless strategy, and developed a vision of how the telecommunications industry and marketplace will unfold over the next 5-7 years. Nordicity principal assisted TIW to validate and refine as necessary the key assumptions underlying that vision, and thereby establish the parameters within which TIW can develop the ongoing strategy.

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