Google May Bid Billions on Wireless
7/23/2007 16:56  Resource:Business Week  Author£ºBusiness Week

    Google (GOOG )maybe ready to make a big splash in a government auction for valuable wireless airwaves¡ªif certain conditions are met.

    The Internet search company said it will bid at least $4.6 billion if the Federal Communications Commission mandates that any winners lease a certain portion of the airwaves to other companies seeking to offer high-speed Internet and other services. Such a provision, Google argues, will give consumers¡ªwho traditionally get high-speed Internet access via cable or telephone lines¡ªa third option for service.

    FCC Chairman Kevin Martin last week previewed draft rules for the auction that did not include this so-called wholesale provision. That's a sticking point for Google, which sees the wholesale provision as critical to promoting competition in the wireless broadband marketplace. It wants one-third of the airwaves that are being auctioned off to be offered on a wholesale basis.

    "Open" Protocols

    According to the Official Google Blog, the online giant also wants the FCC to require the auction's winner to adopt "open" protocols allowing consumers to access any content via any wireless network on the segment of the wireless spectrum up for auction.

    "We're putting consumers' interests first, and putting our money where our principles are¡ªto the tune of $4.6 billion," wrote Chris Sacca, Google's head of special initiatives.

    In a letter to Martin, Google Chief Executive Eric Schmidt said the current proposal falls short of what it, consumer groups, and other companies want. "In short, when Americans can use the software and handsets of their choice, over open and competitive networks, they win," he wrote in the letter dated July 20.

    Breaking Broadband Boundaries

    Google's conditions "would go a long way towards ensuring that the freed-up spectrum fulfills its potential as a 'third broadband pipe,'" wrote Eric Bangeman at Ars Technica. "Winning the auction would put Google in the position to own and operate its own broadband network, where it would be in a position to ensure that its services are available to everyone on its network," Bangeman wrote.

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