Selling a Long-Shot Idea: Free Internet Access

"We're trying to make the cost of computing more affordable," he said. "Computers may be less expensive now, but a computer doesn't mean much without broadband attached to it."

Muleta, 42, started M2Z Networks two years ago with fellow entrepreneur Milo Medin, who was the architect behind a now-defunct broadband network called At Home Networks. They named the company M2Z after their desire to "move to zero" the cost of Internet access -- and it also stands for their children's initials.

They raised $800 million from heavyweight Silicon Valley investors John Doerr, an early backer of Google and Amazon, and Geoff Yang, who invested in MySpace and TiVo. But the money is contingent upon receiving the necessary spectrum for the business.

Muleta said M2Z would consider participating in an auction for the airwaves if the FCC establishes rules conducive to its ideas.

"We have big plans, but at the end of the day, they're just plans if we don't have the spectrum," he said.

Some say M2Z's chances have become slimmer. Some FCC staffers, who spoke on the condition of anonymity because they are not authorized to speak on the matter, said commissioners were initially intrigued by Muleta's ideas but have since been put off by what they consider aggressive lobbying and legal tactics.

Public-interest groups Public Knowledge and Free Press say they support some aspects of M2Z's proposal, including a provision that would allow third parties to lease capacity on the network. But M2Z's plan to block some Internet content could conflict with efforts to ban such restrictions by network operators.

"No one wants kids to look at pornography, but setting up content gatekeepers is a dangerous precedent," said Ben Scott, policy director for Free Press, an advocacy group that focuses on the communications industry. He also questioned whether M2Z would be able to offer speeds fast enough for downloading entertainment content.

During the Internet boom of the late 1990s, Muleta was a senior executive of networking giant PSINet until it folded in 2001. Muleta, who moved from Ethiopia to Iowa when he was 10 years old, holds degrees in engineering, law and business from the University of Virginia.

Other former FCC officials are also trying to gain access to spectrum for their start-up ventures.

Reed E. Hundt, FCC chairman during the Clinton administration, started a company called Frontline, also with the backing of John Doerr. With $3 billion of private investment, Frontline plans to bid for enough airwaves to build a nationwide broadband network open to public safety workers.

Morgan O'Brien, one of the co-founders of Nextel and a former FCC staffer, recently asked the agency to give his newest venture, Cyren Call, a large portion of airwaves for free. While his proposal was not successful, Cyren Call is still in the running to help build a public safety network as part of the upcoming auction.

M2Z has received some high-profile support. In a letter to the FCC, the Rev. Jesse Jackson said the agency has "a moral obligation to promote justice and equality by extending the critical opportunities of the information age to all Americans."

Several prominent politicians and rural phone companies have backed the plan.

Scott said it is unlikely M2Z will get everything it is asking for, but "there are many ways the rules can be set so M2Z can be a player in this."