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.
“The bottom line is
Google , 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.
that the American taxpayer is at serious risk of losing billions of dollars
because one of the wealthiest companies in the world has apparently convinced
policymakers that they require special auction rules that tailor-fit their
business plan.”
Martin’s proposal would be a step in the right direction but still falls short of
what needs to be done to pave the way for a third broadband competitor to
challenge telephone and cable company broadband offerings, members of the Open
Internet Coalition said in a teleconference.
“Our definition of open access includes wholesale,” Gigi Sohn, president and
co-founder of coalition member Public Knowledge, said. Under the Open
Coalition plan, winners of certain slices of spectrum would have to make their
airwaves available at wholesale prices to encourage competition in the
wireless broadband market.
Fellow coalition member Chris Libertelli, director of government and
regulatory affairs for Voice over IP (VoIP) provider Skype, added that the
wireless Internet should have the same diversity of choice as the wired web.
“Currently, there is a very limited set of applications being offered by
wireless carriers,” said Chris Murray, legislative counsel for the Consumers
Union.
