FCC Approves Airwave Use For All Phones
Wednesday, August 1, 2007
Consumers will be able to use any cellphone and software they want on a network built on airwaves to be auctioned early next year, according to rules approved yesterday by the Federal Communications Commission.
The vote sets the stage for the auction of public airwaves that will change hands from television broadcasters to a fast-growing wireless industry. The auction, scheduled for January, is expected to raise about $15 billion for the U.S. Treasury.
The vote was a partial victory for consumer advocacy groups and Internet companies such as Google, which wanted rules that would allow consumers to use a variety of devices on a network. But those groups also sought more-ambitious rules that would open the network to third-party companies. That measure did not pass. Creating an open network would mean companies like Google would not have to arrange with wireless carriers to make services like Web search and online video available, as they do now.
The rules approved yesterday also was a victory for AT&T, which successfully sought to block the stronger rules that would require the winning bidder to resell part of the spectrum to third parties. Verizon Wireless opposed any rules granting access to any new network.
The airwaves, which are ideal for transmitting high-speed wireless signals, are highly valuable to large wireless carriers, which need more capacity to introduce services to customers.
The "open-access" provision was endorsed last month by FCC Chairman Kevin J. Martin, a Republican, and gained support from the two Democratic commissioners, Jonathan S. Adelstein and Michael J. Copps. Deborah Taylor Tate, a Republican commissioner, also voted in favor of the deal. Martin said he hoped the proposal would encourage a new entrant to compete with the cable and phone companies that provide broadband service.
Republican Commissioner Robert M. McDowell voted against the proposal, arguing that placing any conditions on the sale of airwaves would hurt smaller carriers by making smaller licenses without any requirements appealing to larger bidders.
"Smaller players, especially rural companies, will be unable to match the higher bids of the well-funded giants," he said.
The proposed requirement to resell the network to third parties, a concept backed by the Democratic commissioners, was not included in the rules. That provision had been proposed by public-interest groups including Public Knowledge and Free Press, which said it would help create more competition in the wireless industry. Google last month said it would bid at least $4.6 billion on the airwaves if the provision were included.
Without the requirement, Google said it was less likely to bid, though Richard S. Whitt, Google's senior policy counsel, said the company had not ruled out participating in the auction.
AT&T and Verizon fought the Google-backed provision, saying the rules would reduce the value of the spectrum.
Martin set a reserve price on the airwaves. If the minimum bid of $4.6 billion is not met, the airwaves will be re-auctioned without the open-access requirements.