The 700 Mhz spectrum auction results were revealed today. The big winner? Verizon Wireless, which took the largest chunk of the sought-after C-block according to The Wall Street Journal. But was Verizon the real winner in this situation? Or was it actually Google?
Google, after all, is the company that pushed for the FCC to adopt certain “open” requirements for the winner of the spectrum auction. These included opening the network and any devices used on the network to third parties.
When Verizon heard that the FCC would implement a rule requiring the winner of the auction to use it within open network guidelines, Verizon sued the FCC to attempt to stop the auction from going forward.
“Imposing any such requirements in the competitive wireless market would reduce the revenue the government will receive from the spectrum auction and limit the introduction of new and innovative wireless service,” is what Verizon had to say at the time.
That, of course, turned out to be a preposterous statement as the spectrum auction went forward and garnered nearly double the amount of cash the government had hoped for from the bidding (our coverage) — most of that, coming from none other than Verizon. (AT&T and Echostar won some smaller parts of the spectrum as well.)
Once Verizon knew the auction was going forward it clearly did not want to lose. This made for an interesting situation given the talk that Google might have been placing a bid simply to make sure the minimum was reached for opening the C-block. It appears, that may have been precisely what took place.
Google ended up with no licenses for any of the spectrum, but did get what it wanted: An open spectrum.
Meanwhile, Verizon has control of the spectrum, but must do with it what it initially sued to stop, keep it open.
Of course, Verizon has changed its tune since that lawsuit and now seemingly favors open networks. However, questions remain if this “open” talk is simply spin or a legitimate effort to help developers and consumers (our coverage). What Verizon ultimately does with the 700 Mhz spectrum should speak to its intentions.
Looking back on these events, history may judge it as (if I can reconstitute a quote from Charles Baudelaire famously used in The Usual Suspects): The greatest trick Google ever pulled, was convincing the world it was bidding to win the spectrum auction.
update: Google put up a short post on its Public Policy Blog weighing in on the matter (they can’t say much due to the FCC’s anti-collusion rules). Basically, it reads as: Thanks everyone for playing!
[photos: flickr/doob31 and francemagazine.org]
Tags: co:google, co:Verizon7 Comments
-
Marc Fawzi said:
I love it! I love it! I love it!
-
Marc Fawzi said:
I’d like to append to the above that Qualcomm, a provider of CDMA technology to Verizon, is a member of the Google sponsored Open Handset Alliance.
Android OS will work on CDMA phones.
Verizon just couldn’t make itself join OHA during this awkward stage in the evolution of their argument. They had their technology provider join it for now.
-
MG Siegler said:
@Marc - Thanks for the info. I recall Verizon in that awkward stage of not committing to the OHA but saying they probably would join eventually.
-
Dean Siegler said:
Verizon was hardly tricked.
They and AT&T were the two main competitors for blocks of the new frequencies that were superior to what they currently have, and would cover the entire US. Aside from their own needs (for next generation phones), they also had to bid to keep out competitors (Google or no Google).
This was a once-in-a-lifetime auction for a monopoly on a band of frequencies over a large number areas (and in the case of Verizon’s winning bid, over one large contiguous area. A license that in itself is valuable, but also allows the owner to harvest it for their own cash.
-
MG Siegler said:
@dean - yes, the key word in the sentence being ‘open’. Verizon clearly wanted the spectrum, I don’t know who wouldn’t, but they (at least initially) did not want to have to commit to opening it.
More details will come in the following days, but it would appear that it was Google who may have placed the minimum bid to ensure the spectrum would be open.
-
Paulo said:
A great observation, but not an original one.
For all the Valley types who were rooting for Google, the Teflon Kid, we’ll leave you to ponder the words of Verbal Kint: “The greatest trick the devil ever pulled was convincing the world he didn’t exist.”
Chris Williams in The Register - Thursday 25th October 2007
http://www.theregister.co.uk/2007/10/25/microsoft_facebook_comment/page2.html
-
Larry said:
I must say I like that everything is open and the picture from Doob31 at the top is excellent
3 Trackbacks
1:25 pm
Google kicks off ‘white space’ race for faster Wi-Fi » VentureBeat said:
[...] settled and Google having gotten what it wanted (even in not winning) — an open spectrum (our coverage) – the company now sets its sights on a new frontier: your television’s “white [...]
11:59 am
Verizon asks FCC for permission interrupt cable’s broadcast » VentureBeat said:
[...] Google using it against them to make sure the 700 Mhz spectrum auction produced an open spectrum (our coverage). The company also made sure to cite numerous times the buzz word the FCC loves so much: [...]
4:49 pm
Google sounds off on spectrum auction » VentureBeat said:
[...] As we suggested when news about the auction results broke, Google is very happy with the outcome despite not winning a single piece of the spectrum. Why are they so happy? The company believes its actions both leading up to and during the spectrum helped the consumers and the industry as a whole. [...]