Google's Money Could Change Everything in Wireless Communications Posted by Bob at 07/23/07 01:27 PM

It is hard to imagine a more uninteresting congressional hearing than this one scheduled for tomorrow morning before the House Subcommittee on Telecommunications and the Internet -- "Oversight of the Federal Communications Commission – Part 2."

But that was before Googe's announcement late last week that is prepared to pony up at least $4.6 billion to buy up some airwaves and put together a nationwide wireless network to challenge the semi-monopoly for high-speed Internet service currently enjoyed by phone and cable companies.

At issue are rules for an upcoming auction of a slice of prime airwaves being returned to the government by television broadcasters as they transition to digital signals. Those airwaves -- which are located along the 700 megahertz portion of the broadcast spectrum -- are highly coveted because they are capable of traveling long distances and penetrating barriers, such as buildings.

Google says it wants to buy up about a third of the airwaves and build a so-called "open access" nationwide wireless network. Any wireless device or application could be used on the network, unlike the current high-speed Internet market where phone and cable companies tightly control the equipment and applications used on their networks.

Google also wants to offer access to its network on a wholesale basis, something that has spurred the development of a host of new wireless devices and services in other parts of the world.

Federal Communications Commission Chairman Kevin Martin has said he would like the auction to produce a network that would allow the use of any wireless device or application, but he has not endorsed a wholesale requirement. Google says it is willing to pony up an anticipated minimum required bid of $4.6 billion for the airwaves it wants, but only if the wholesale proviso is included in the auction rules.

As might be expected, the phone and cable companies hate the idea of an open access network. It has the potential to offer real competition to their current near-monopoly on high speed Internet service, something experts call a "third pipe."

Before Google made its announcement, the phone and cable companies were warning the FCC it ran the risk of driving down the auction price for the airwaves, saying they might not bid for any airwaves encumbered with strong open access provisions. Google's announcement effectively gutted those arguments, however.

The five members of the Federal Communications Commission have been invited to appear at the House subcommittee hearing tomorrow morning, and the rules for 700 megahertz auction are expected to dominate the meeting. The agency is expected to issue the auction rules sometime in the next month or so.

If you have high-speed Internet service, you can watch tomorrow's hearing on your computer by going to http://energycommerce.house.gov/membios/schedule.shtml.

Should be pretty interesting.

comments (0)