Spectrum Auction Rules Near

Sources within the FCC have told reporters that Commission chair Kenneth Martin has finalized draft procedures for an upcoming auction of spectrum in the 700 MHz band, and that they include provisions that effectively rule out the proposal made by Frontline Wireless LLC for a nationwide public safety radio network. The procedures would also reportedly allow less regulation of a slice of new spectrum by the auction winner, which might give Google a bidding advantage over cellular carriers AT&T, Verizon and others. The auction could begin in Jan. 2008, and the final rules could become public in the next 1-2 months. Read more here, or an article from The Wall Street Journal here. [more]

Commentary: The implications of any “open access” spectrum are enormous, especially for existing cellular carriers, who oppose any relaxation of access rules. In theory, the FCC’s rules could open the bidding to a new group of companies, reportedly including Google and Skype, who would simply operate a huge wireless network, and allow any device from any company to connect to it, presumably for a fee. The devices might include IP handsets for voice communications, existing hybrid devices such as the new iPhone, and a wide range of future devices from various companies for handling wireless video, radio, music, photos, etc. At this point, nationwide wireless access is provided by (or limited to) cellular carriers, who dictate which devices may connect and what services they provide. With an open network, there would be no limit on the services that could be provided on the new network, allowing creative companies to come up with advanced solutions that could threaten cellular’s control of wireless services–and their revenues.