Google Set to Bid $4.6 Billion for Airwaves 156
Nrbelex writes "The Associated Press is reporting that Google has offered to bid at least $4.6 billion on wireless airwaves being auctioned off by the federal government, as long as certain conditions are met. 'The Internet search company wants the Federal Communications Commission to mandate that any winners lease a certain portion of the airwaves to other companies seeking to offer high-speed Internet and other services. Such a provision, Google argues, will give consumers — who traditionally get high-speed Internet access via cable or telephone lines — a third option for service.'" We discussed AT&T's objection to Google's acquisition of these airwaves last week; this article would seem to confirm Ma Bell's worst fears.
Well that's interesting... (Score:1, Interesting)
Let me know if I read that wrong, but it sounds like Google is morally good.
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Bring it on!!
AT&T now supports open access for 700Mhz band (Score:5, Informative)
Open access rules would require the auction winner to allow any compatible device to connect to their networks on the effected spectrum.
Why open access? (Score:1)
Why would you plunk down a few billion to buy rights to something you have to let everyone use? I'm sure I'm missing something fundamental
Re:Why open access? (Score:5, Insightful)
Re:Why open access? (Score:4, Insightful)
It's making more money by being less evil. If a single company held the spectrum and the equipment to access it, then either they have to be amazingly good at making products that everyone wants, or they cannot maximize their market share. Imagine if the only cellphone in existence was the iPhone. Would you pay $500 for it, or stick to a land line? Now imagine if Cingular only sold iPhones. Those other networks with more choice and cheaper phones suddenly look a lot more attractive, don't they?
Google's position is just the realization of the fact that if they're going to compete against the existing phone companies, they'll make more money by letting anyone and everyone on board, rather than limiting it to a dozen or so devices.
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open access (Score:2)
So they're basically buying a new market,and hoping to get enough other folks into to it to attract customers? Expensive and risky
Because there is demand for those airwaves, it isn't really risky. And if the buyer is required to offer those airwaves to others at wholesale prices, the price for the rights to those frequencies, won't be so high.
FalconRe:Why open access? (Score:4, Insightful)
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Re:Why open access? (Score:4, Interesting)
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I'm rooting for google here, i like how they're playing this one.
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Re:Why open access? (Score:5, Informative)
Ultimately Google knows that a handful of ISPs control the entire consumer network, and they're trying to poke holes in it to give themselves and others a shot at competing.
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I know why we'd want it... but I don't undertsand it enough to know why Google would want it if they bought it.
Why would you plunk down a few billion to buy rights to something you have to let everyone use? I'm sure I'm missing something fundamental
Because it's another revenue source. Say I own the rights to the airwaves, but you come up with an application or device that uses those airwaves. I lease them to you, so you can run a business with you app or device. I can't do what you're doing, but yo
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Both of these will also d
Re:AT&T now supports open access for 700Mhz ba (Score:5, Interesting)
I think you meant to say that the auction winners would have to lease, at a wholesale price determined by someone, a third of the bandwidth to other service providers that customers would then pay to access the network.
For this to be anything more than just grandstanding for good karma by Google I'd like to see how the wholesale price is set and why it's a lease instead of a purchase. Google pays a one-time fee for the airwaves and then leases them off a third of them which generates a nice revenue stream for them. The people doing the leasing still have a competitive disadvantage since they always have a bandwidth charge to add to their business model, while the purchasers will recoup their original investment over time and not have that leasing charge on their P&Ls.
Re:AT&T now supports open access for 700Mhz ba (Score:5, Informative)
Regards,
Steve
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Re:AT&T now supports open access for 700Mhz ba (Score:4, Interesting)
Surely the obvious solution is for the government to retain ownership?
Then companies who want access can lease from the government rather than a competitor.
Why would you insist on handing over a monopoly to a private corporation in the first place?
Re:AT&T now supports open access for 700Mhz ba (Score:5, Funny)
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Well, not quite (Score:5, Insightful)
1. Users can use any device to access the network
2. Users can run any software they'd like to run
3. The network interconnects with the internet
4. The network operators lease bandwidth to 3rd party companies
The draft proposal that the FCC chief published (and that AT&T just agreed with) protects the first 2 of those rules, but not the last 2.
The impetus for Google to front this money was the Telecoms lobbying the FCC with the argument that requiring openness will reduce the value of the spectrum and thus reduce the Governments take. By fronting this money, Google negates that argument. They'll only bid if these rules are established, and the Gov't will almost certainly make more money with Google bidding than with them sitting out.
Suddenly the FCC is left with very little reason to oppose openness. This, in my opinion, removes the political cover that he'd need. It's a game changer and a genius play by Google.
Explain this "innovation" to me... (Score:2, Interesting)
Why would a closed spectrum discourage innovation? I would think not forcing people to "lease" portions of the spectrum to higher powers would curb the high cost that hinders most of the world's greatest minds.
Re:Explain this "innovation" to me... (Score:5, Informative)
Re:Explain this "innovation" to me... (Score:5, Insightful)
The reason that we don't have a lot of competition in the Cable TV realm is because the Cable companies own all the cables that they install. They are not required to let another cable network use those wires. DirectTV competes by totally bypassing the cable wires.
Wireless companies and the major internet providers have much the same stranglehold over broadband & cell phones. Because they install the Last Mile hardware (wired and wireless), they own it, and there is no legal requirements that they allow competitors to truly use it. So their competitors are forced to gather a lot of funds and create a secondary network. That's a high barrier to entry, and means that anyone who wants to get involved is in for one helluva challenge.
The above is what happens in a closed system. Because there are such a limited number of closed systems available, when they are all owned, the resources are literally unavailable to any future entrepreneurs that wish to compete.
The idea behind a fully open spectrum that interfaces with the internet is that we can make available (essentially For Cost) a competitive set of access capabilities. So instead of people being forced to use the closed-access spectrums, entrepreneurs are legally allowed to compete without being blocked in any way! This will allow of number of potentially awesome things to take place for both consumers and competitive businesses.
As a consumer, I want this because I dream that one day soon I can buy a linux smartphone that surfs the web, plays music, and connects to any of the major competitive cell-phone companies without requiring a subscription term or early cancellation fee of any kind. Entrepreneurs want this because the Wireless companies have huge profit-margins and high costs, and are ripe to be undercut and turned in a commodity market. Entrepreneurs (and consumers) also want this because they are sick and tired of dealing directly with the wireless companies in order sell their content. Google wants this because then they can work out deals with growing wireless telco's to sell targeted advertising.
I haven't even begun to get into the ramifications for Broadband service! Let's just say that everything good I said about Wireless, multiply that 3x and you're just scratching the surface for what this will help create in the ISP sector.
This is an opportunity to force the giant telco's, ISP's, and wireless providers to start playing fair for everyone. If they aren't up to the task, than they can close up shop while their new competitors provide better service and better prices to us, the consumers.
- DaftShadow
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I though the US had Local Loop Unbundling? Or is the FCC not in the habit of enforcing a competitive market?
As a consumer, I want this because I dream that one day soon I can buy a linux smartphone that surfs the web, plays music, and connects to any of the major competitive cell-phone companies without requiring a subscription term or early cancellati
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Well, the fact that AT&T has basically reassembled itself after being broken up a few decades ago should be proof enough that no, they're not in the habit of enforcing a competitive market.
However yes, at the moment we still have local loop unbundling and a number of other things that allow some competition over phone lines. It's why you can get your DSL from companies like Earthlink instead
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Unless you let the telco install fiber to the curb... now they don't have any copper to lease, and you're locked in once again.
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See, that's exactly the kind of thing a competent regulator should be preventing. No, you can't cut the copper, and whatsmore, the co
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Why would a closed spectrum discourage innovation?
As someone else already answered, because it prevents others from creating things. If Ma Bell hadn't been required to allow devices other than their own, there wouldn't of been answering machines, faxes, or modems, and yes, I recall when 1200, heck, 300 baud modems were considered fast.
FalconIsn't it great (Score:5, Funny)
you think if I offered the FCC $50 they'd sell me the blue?
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It's based on the utterly false... (Score:4, Interesting)
1) Maximizing US Federal Government revenue is equivalent to maximizing public good.
2) That airwaves, which by natural law are a shared public resource, can somehow be auctioned/sold.
It is the modern equivalent of the English Enclosure movement. [everything2.com]
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Or manifest destiny.
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1) Maximizing US Federal Government revenue is equivalent to maximizing public good.
Dubious assumption indeed.
2) That airwaves, which by natural law are a shared public resource, can somehow be auctioned/sold.
Reasonable assumption.
It is the modern equivalent of the English Enclosure movement.
With one key difference, they're paying for the airwaves used. As far as I can tell, the common lands were given away in England with the wealthy being heavily favored. Further, I don't think natural law
Uh, no... (Score:2)
Spectrum regulation inarguably is a States Right under the 10th Amendment, disinginuous and self serving federal court rulings aside.
See the Commerce Clause of the Constitution (Score:2)
Not only that, but the Constitution says that states cannot place trade barriers against other states (For example, there can be no ban in Florida agai
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Spoken like a true Federalist... (Score:2)
Your red herring with regard to interference among states fails miserably, too. Look at traditional cooperation in Europe and elsewhere, where countries are comparable to US States with regard to physical RF spectrum issues.
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Not really; the use of them is being regulated. As a matter of fact, if this didn't happen, they'd be pretty useless. One day you're happily browsing the web via your 802.11e, the next, some prick has come along and disrupted your signal for his HAM radio. Or something.
Ignorance can't be much better shown... (Score:2)
You also seem to be confused by the difference between regulation and ownership, two fundamentally different and completely unrelated principles.
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They would at first, but would quickly recant and reverse course after protest from the Hooloovoo [wikipedia.org] Ambassador...
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Buying the right to use a portion of the EM spectrum is, fundamentally, no different
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I could then charge other people money to use that segment of the spectrum the same way google could charge people to use 700mhz after they're awarded rights to it. If i bought blue, I could charge a tax to anyone who uses the color.
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ATT's Worst Fear. (Score:5, Insightful)
A well funded competitor.
Reminds me of Alien vs. Predator. (Score:2)
I'm not convinced (Score:2)
Re:I'm not convinced (Score:4, Informative)
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If google owned an infrastructure as big as att, they would have much higher cost of operation which would drag down their ridiculous profits.
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Fixed! (Score:1)
here we go again (Score:3, Funny)
Anyone entrenched in cable or land-line phone.... (Score:2, Insightful)
Re:Anyone entrenched in cable or land-line phone.. (Score:4, Informative)
Re:Anyone entrenched in cable or land-line phone.. (Score:5, Insightful)
Yet. Google will eventually be subverted and have to play by the old-boy rules.
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You mean like how Microsoft eventually conceeded that it had to behave like IBM told it to? Or the eventual victory of the sheet music publishers over these new fangled phonographs? Or how every last square inch of the earth is now a part of the British empire?
No. They don't have to play by anyone else's rules.
Dave
Re:Anyone entrenched in cable or land-line phone.. (Score:2)
should be peeing their pants right now
and probably have been for some time now. The world is a rapidly changing place and (imho) I think we are beginning to see the virtualisation of real life. It will not be long before you'll see virtual graffiti daubed along the back alleys, characters from some MMORPG scurrying around your local church while 'old skool' religious types pray to someone who exanguinates, where the most valuable commercial real estate is not where people have time to shop but where people have time to browse. The wireless
Re:Anyone entrenched in cable or land-line phone.. (Score:2)
And the phone companies aren't going to be waiting, either. All the RBOCS are planning FTTH, or at least FTTC (fiber to the curb), and Verizon WILL go national with their fiber network at some point (although it could be years before it gets to your house).
Sadly, we'll a
Re:Anyone entrenched in cable or land-line phone.. (Score:2)
The cash offer is just a PR stunt. (Score:2)
That said, It would be much better for google to win this than almost anyone else. At least I'm confident they won't waste the technological potential.
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Re:The cash offer is just a PR stunt. (Score:4, Informative)
4.5bi for airwaves, but how much already spent on (Score:2)
Re:4.5bi for airwaves, but how much already spent (Score:2)
The one thing Google needs to make this work is "universal" wireless access. They'd like to simply buy 1 channel (bonus points for 2 next to each other) across the entire USA... then they could let their PHDs lay out a neat, clean spec. Google would be willing to let a bunch of companies compete for devices on this network... as long as they support Google ads.
do no evil? (Score:2)
How is seeking government regulation to strengthen a particular company's ability to do business not evil?
Re:do no evil? (Score:5, Insightful)
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Regards,
Steve
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How is seeking government regulation to strengthen a particular company's ability to do business not evil?
This will benefit many companies not just Google. By allowing open access any company can offer products and services using the airwaves. That is good not evil. What's evil is having only one company who controls what's available.
Falcon"don't be evil" (Score:2)
Every law, good or evil, will benefit some company. This does not in itself have any moral implication. Working for some law to be enacted is only evil if that law itself is evil.
I welcome our google overlords (Score:4, Interesting)
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Poetry. Sheer poetry.
I can't wate to use that phrase on my wife.
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Better Google than anyone else (Score:2)
LEO Satellite (Score:2)
LEO = Low Earth Orbit, ~200mi up versus ~26,000mi up for geosynchronous ones.
Skip 700Mhz and go for true global coverage instead.
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I also was the very first person to establish a PPP connection over an Iridium satellite, at a phenomenal 4.2kbps speed. The problem was that it cost 6 billion dollars to deploy, but by the time we had it up and running cellular phones had pretty
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( http://en.wikipedia.org/wiki/Satellite_flare [wikipedia.org] )
I don't have a satellite phone, but the heavenly light shows can be truly stunning, thanks!
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I'm willing to bid as well (Score:2)
Well I'm willing to bid $100 Billion dollars, as long as certain conditions are met. Namely, I receive a $99.99 Billion tax refund to "develop my new wireless business". Google's promise to bid raises the floor for the spectrum auction, but is just about as self-serving. In the end, consumers will pay no matter what the rules are. As long as they're na
"Ma Bell" (Score:4, Funny)
Just nitpicking.
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Most recently being Cingular purchasing AT&T and changing its name to AT&T. Cingular used to be SBC/Ameritech.
I believe you're completely mistaken. Cingular was a joint venture between SBC (which already owned Ameritech) and BellSouth, but Cingular operated as a separate company, not really part of SBC or BellSouth. Then, Cingular bought AT&T Wireless (from AT&T I assume, although it's possible AT&T had already sold AT&T Wireless off to some other company first), and AT&T Wireless rebranded and merged into Cingular. Then, when SBC bought BellSouth and AT&T, they absorbed Cingular and ren
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Ramones! (Score:2)
Airwaves (Score:2)
http://en.wikipedia.org/wiki/Open_spectrum [wikipedia.org]
explanation of interference.
http://www.acmqueue.org/modules.php?name=Content&
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Like they say, it destroys innovation!
Re:Et Tu, Google, mon dieu (Score:5, Insightful)
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the spectrum is like the air, it's as much mine as it is yours, and if the government wants to give control of something like that to any corporation is a problem with a LOT of us cowards who would like to remain (as) anonymous (as one can.)
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Re:Et Tu, Google, mon dieu (Score:5, Funny)
Liar! No AC has ever said such a stupid thing.
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Which country you from? Tax payers don't vote on stuff like this. There's not even a system for collecting such a vote. While some States have such systems, "voter initiatives" or "proposition systems," like California, there is no analogous Federal system.
C//
Disclaimer: I dislike most governments, (Score:2)
and believe that communism would be viable, with enough effort
Funny, if you don't like governments, well most of them, why would you like the biggest government?
I'm sure that many people would like to have a completely free spectrum
Under communism, there would be no free spectrum. The government would own it all.
which anyone could use for their devices.
Nobody would own devices, any devices that existed would be owned by government.
Falcon
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Calculate the amount you'll pay them per month, the amount that they get in profit and then the cost of build out. Then figure out how long it takes to realize those "eventual" profits. It just doesn't make business sense sometimes. Now, if we want to say, that rather than being purely profit driven, it should be seen as some kind of right or necessity for the overall good, then that sounds like the time for government to subsidize it into making business sense.
Quick example: We all used to drive down ro
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Should the telecom companies decide that nothing is left except IP connections, my guess is that we are going to see the same players just continue on. There would likely be some "consolidation"