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Google et al. Want 700 MHz Auction Opened Up
Journal written by twitter (104583) and posted by
kdawson
on Sun Jun 03, 2007 07:13 PM
from the third-helping-of-pipes dept.
from the third-helping-of-pipes dept.
The 700 MHz spectrum could give birth to the much-anticipated third pipe, but phone and cable lobbyists are currently pressuring the FCC to sell companies like AT&T and Verizon our airwaves — in a flawed auction process — so they can hoard this valuable spectrum and stifle competitive alternatives to their networks. Google and other would-be providers are not taking it lying down. They want the FCC to mandate that whoever wins the auction be required to sell access to those airwaves, at wholesale prices, to anyone wanting to provide broadband Internet service. They also want anonymous auctions to prevent the giant incumbents from manipulating the results against small players (as they have done in the past).
Related Stories
[+]
Mobile: Google Plans to Bid 4.6 Billion on 700MHz Band 148 comments
NickCatal writes "The Wall Street Journal is reporting that Google plans to bid $4.6 Billion on the 700 MHz radio spectrum being auctioned off by the FCC. What is most interesting is that they are not planning on partnering with other companies to raise the cash, they are going to spend their own cash and possibly borrow some. With partners such as Sprint Nextel and T-Mobile in their 'Open Handset Alliance' is this a sign that they are willing to directly compete with the people they courted to join?"
[+]
700 MHz Auction Begins Tomorrow 187 comments
necro81 writes "On Thursday, after much speculation and wrangling, the FCC will begin auctioning licenses to the coveted 700 MHz band that will be vacated by analog TV in 2009. The NY Times has a good summary of the players (AT&T, Sprint, Verizon, Google, et al.), how the auction will work, how Google has already scored an open networks victory, and what it could all mean for consumers. The auction will go on for several months, but you can keep tabs on the bids at this FCC site."
[+]
Mobile: The 700mhz Spectrum Auction In Perspective 88 comments
YIAAL writes "Writing in Popular Mechanics, Robert X. Cringely looks at the upcoming auction of the 700mbz spectrum, which is currently used for soon-to-be-defunct analog TV. 'Why are all these companies so excited? Because the 60 MHz of spectrum that's about to be auctioned is the last prime real estate for mobile communications that will be available in the U.S. for decades to come ... Some pundits (that would be me) think Google will bid to win its spectrum block, then will trade that block to Sprint/Nextel for some of that company's 2.5-GHz WiMAX licenses that are far better suited for data.' Plus, the prospect of offering unlicensed data service in the 'white space' between existing broadcast channels."
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Generalized Economic Rent Tax (Score:5, Interesting)
The users should rent it from the government that is enforcing their property rights over this natural resource.
This is a principle called "economic rent".
Milton Friedman has declared such taxation the "least distorting" kind of tax.
The way to set the rental agreement is to determine the liquidation value of the "land", and then charge a rent on it equal to the interest rate on short term US treasury instruments.
As with any rental agreement there would be other terms but the basic idea is that such resources enjoy liquidation value changes that are primarily a result of the economic environment -- meaning economic externalities drive the liquidation value -- and allocation of externalities is a social function.
Monopoly Rents. (Score:3, Interesting)
The users should rent it from the government that is enforcing their property rights over this natural resource.
Others have argued there is no scarcity of the resource you are talking about [slashdot.org], so no regulation is required. Taxing unlimited resources is socially harmful. In this case, the only purpose of the tax is to "protect" incumbents and their revenue stream. The cost to the rest of us for that revenue stream is the majority of your monthly telco bill, and a proportion of all the goods and services
Re:Monopoly Rents. (Score:4, Insightful)
They have argued it, but it's clear they have no actual knowledge of wireless communications. Read just a few of the comments under that story to see a few reasons they're completely mistaken.
As technology improves, you can do more with less, but no amount of technology is going to make a limited resource like spectrum, infinite.
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Make the FCC try something new... (Score:5, Interesting)
Save Our Spectrum (?) (Score:5, Interesting)
- establish a service rule for broadband services operating in the 700 MHz band that protects the consumer's right to use any equipment, content, application or service on a non-discriminatory basis without interference from the network provider.
- allow third-party access to spectrum owned by other companies. This "open access" plan to include wholesale access to networks would enable more competitors to offer services
- institute anonymous bidding in auctions to lessen the possibility of bid signalling and bid rigging that studies found to have taken place in prior auctions.
Also, what about open spectrum [wikipedia.org]? Does it work well in practice? Would that be a better solution? (though I know it's a moot point for the upcoming auction.)Spectrum Anarchy - kill the FCC (Score:4, Insightful)
Re:Spectrum Anarchy - kill the FCC (Score:4, Interesting)
However in practice that has turned out to be a complete and absolute lie
Is it? I have no metrics to back up what I'm saying, I haven't done any research on the topic, but I live in a gadget soaked suburb, and anything in the 900mhz or 2.4 ghz band is completely unusable, and 5.8 used to be fine, but is worsening. I already had to wire my house to get around the massive interference from my neighbors and all their spurious emissions. My radio even picks up the digital clicks from their cell-phones. I don't know what the answer is, but a bunch of conflicting stuff is a bad answer.
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Re:Spectrum Anarchy - kill the FCC (Score:5, Informative)
And considering that there are still LICENSED users of those bands who've all but had to abandon them to the noise floor created by the Part 15 unlicenced gadgets also adds more fuel to your comments.
900 MHz, and 2.4 GHz are already overcrowded wastelands, and spread spectrum technology somewhat covers up the mess that's been made there for the end-users. There are now 15 (most open, unsecured) 802.11 access points accessible from my suburban driveway. We're all interfering with each other, most of the end-users just don't know it. They think the performance numbers they get today are normal. Early adopters have seen it go drastically downhill.
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Re:Spectrum Anarchy - kill the FCC (Score:5, Informative)
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Third pipe (Score:5, Funny)
Yeah, I've been trying to get my wife to go for that for a while, but she's afraid of getting Santorum all over the place.
Re:Hmm... (Score:5, Funny)
Well one's normally referred as a tube.
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Re: (Score:3, Funny)
Re:Hmm... (Score:5, Informative)
"The 700 MHz auctions will not give birth to the much anticipated third pipe if the licenses are auctioned to the very same vertically integrated telephone and cable incumbents that dominate the wireline market."
Reading that leads me to believe that "telephone and cable incumbents that dominate the wireline market" are the first two pipes.
Pipes of course referring to internet connectivity.
You have to have a pipe to connect to the tubes... (couldn't resist)
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Re:Straight face. (Score:5, Insightful)
It's been way more reliable for me than my neighbors' cable internet. Sure, their highest burst download speeds are better than my paltry 3 meg connection, but I have that 3 meg connection with very little variation day and night. Their cable connection slows down noticeably after school and in the evenings--when most of us are using the net. Our DSL does not slow in any detectable way.
Cable still has a stronghold here (semi-rural Kansas) due to the number of people out of reach of the DSL service area, but still within cable service.
I just don't see DSL as dead, or even threatened. Not around here, anyway.
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Re:Straight face. (Score:4, Interesting)
I have the option of wireless internet, as I work for a WISP who just put up an ap about 6 blocks from my place. They offered me service but....meh, that stuff has lousy bandwidth in the 900mhz range
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Re: (Score:3, Interesting)
You can keep your money. (Score:5, Interesting)
The FCC has intentionally let the market collapse to a false competition between a local cable company and a local phone company. Very few phone companies have come through with their promisses so Cable is really the only option most people may have. Cable everywhere has blocked ports and intentionally low upload speeds. The US 16th in the network world and falling fast.
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Re: (Score:3, Interesting)
Does that mean free, high speed, wireless internet access paid for by Google Ads? Probably not. But it might. There were several companies doing the same with dial-up a few years back.
This has yet to happen. (Score:5, Insightful)
Why wouldn't [Google] simply outbid the competitors and sell the space themselves?
The "competitors" can collude and form a much larger bidder than anyone else. They drive the price up where real competition advances but leave prices low for themselves elsewhere. If bidding is anonymous, it will be harder for people to collude and everyone will have to pay what they think the airwaves are worth.
There are still problems with the proposals. The first is that the incumbents won't treat their competitors fairly, even if forced by law to share. They will screw them over and pay whatever fees the government levies but then pass the costs back to you and me. The second problem is that the incumbents can overbid because they know there will be no real competition and they can charge whatever they like in the long run. These are not shortcomings of a free market, they are failures in regulations for a scarce resource which some say is not scarce afterall [slashdot.org]. It's ultimately a failure to share equitably.
How much do you really want to pay for your airwaves? I want mine free. The FCC should change it's mission to the above mentioned report and enforcing peaceful co-existence. The only problems with spectrum would be accidental disruption, which can be fixed, and willful disruption, which should be punished.
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Re:Surely..... (Score:5, Insightful)
Actually, they do have enough money - Google has a market cap roughly equal to Verizon and Time Warner combined
The problem here doesn't (only) involve money, though - Basically, it sounds like these auctions have most of the "fairness" of EBay, where unscrupulous sellers (sadly, our own government in this case) and bidders can drive a price up far beyond its fair value. In this case, the existing broadband companies (the first two pipes referenced in the FP) would presumeably like to keep their regional duopolies and would either use the 700MHz range for their exclusive use, or if they can, buy it cheap just to prevent anyone else from using it.
Thus the requested condition that the winner MUST license it to competitors - That prevents Verizon (for example) from using various tricks to get the spectrum cheap and then do nothing with it.
Not so sure I understand the reason for some of the other mentioned terms of the auction (anonymous? I know our government has some corruption, but so bad that a non-anonymous auction would give the existing players an unfair edge?)
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Re:Surely..... (Score:4, Funny)
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Re:Surely..... (Score:5, Insightful)
The governments lie of just focusing on selling it to the highest bidder, who just it turn feels they will be able to charge us the most for access , means they are no in any way shape or form representing the interests of the people but only establishing yet another part of the public wealth as a closed off private area for profit by corporations at the expense of the general public.
So will this auction be held and this release of spectrum be in the public interest or will it be yet another demonstration of the corruption and inherent ignorance of a typical corporation controlled government administration.
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Re: (Score:3, Interesting)
Lately the FCC is pretty good (with the prez approval) about keeping big deals that benefit mega corps quite (posted in a lavatory in the basement of city hall for us plebs.. but the dept head goes out of his way to meet the big players for lunch about the deal) The FCC is VERY anti-little-guy right now, and even guys like Google are still "new money".. another term for little guys that can momentarily out spend you for a new toy. The effort is making sure the
Everyone could win. (Score:4, Interesting)
No matter who wins this fight, we all lose.
No, it's possible to lower the cost of wireless by fixing the bidding process. If ATT and friends know there will be real competition, they will be less able to run the prices up. It won't be impossible but it will be harder.
A real sharing of spectrum is possible [slashdot.org] but politically unlikely. Really, we should claim the air for ourselves and no further regulation is required other than policing intentional disruption.
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Politically unlikely being the critical point (Score:3, Interesting)
Pity, that the truth is modded down as a troll, or flamebait, redundant, whatever. It's still the truth.