Google Prepping National Wireless Broadband Entry?

FCC chairman's proposed spectrum auction rules could pave way for search giant to challenge incumbent wireless carriers.
Posted July 11, 2007

Roy Mark

A possible Google entry into the wireless broadband market received a boost today with Federal Communications Commission (FCC) Chairman Kevin Martin endorsing dedicating a portion of the upcoming 700 MHz spectrum auction to open access requirements.

According to an FCC source, Martin has finished a draft set of rules for the January auction that would dedicate 22 of the 60 MHz up for sale as open access airwaves. The proposal has not been circulated to other FCC commissioners.

Open access spectrum, as proposed by Martin, would allow consumers to connect any legal device to the wireless network. The rules for the spectrum would also contain prohibitions against the network provider blocking legal content, a key provision of network neutrality.

Google (Quote), which has petitioned the FCC to set aside some of the auction spectrum for an open wireless platform, welcomed Martin's proposal. Speculation has swirled around both Washington and the Silicon Valley that if the FCC were to carve out some of the spectrum for open access, Google might be inclined to bid for that spectrum.

"If these reports are accurate, we are most encouraged by this favorable development," Richard Whitt, Google's Washington telecom and media counsel, wrote on the company's blog. "Obviously we'll need to see the fine print, but such a proposal would represent a step forward for new, innovative entrants to the broadband market."

Whitt wrote Google has been taking a "closer look" at whether and how Google might participate "meaningfully" in the auction.

The auction may be one of the most lucrative in U.S. history with speculation that it will bring in as much as $20 billion. The spectrum will come from airwaves deserted by television broadcasters as part of the digital TV transition and is considered ideal for wireless broadband.

As originally envisioned by Congress, the spectrum would go to the highest bidder with the proceeds underwriting digital converter boxes for consumers and a national public safety wireless network. Excess proceeds will go to the federal treasury.

But many groups have opposed that plan, calling instead for at least some of the spectrum to be dedicated to an open network. The hope, the groups say, is to establish a third broadband competitor to telephone and cable companies.

"Our analysis has confirmed that, under the originally proposed rules, the existing national wireless carriers are likely to prevail in the bidding process against a potential new entrant like Google," Whitt wrote.

Wireless carriers were quick to criticize Martin's proposal.

"Crafting special rules for a company with a market cap of $170 billion to address problems that don't exist in our competitive market makes absolutely no sense whatsoever," Steve Largent, president and CEO of the incumbent wireless carrier trade group CTIA, said in a statement.

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