Google Nervous About Verizon's Open Access

Ian Lamont writes "Google is so worried about Verizon Wireless's commitment to open access using the 700Mhz spectrum that it has asked the FCC to get a pledge from Verizon that the carrier will honor the FCC's open-access conditions before the FCC sells it the band. Verizon won the auction for the nationwide C block of the 700MHz spectrum, but Google points to Verizon's alleged attempts to abandon the conditions, including a filing with the FCC which said the commission 'could not force the C block winner to allow all applications on the network.' Could this be another expanding front in the Net Neutrality battle, or is it time for the carriers to accept the fact that Net Neutrality is essentially a done deal, and carriers need to prepare for the next battle — developing software and services to run on open networks?" The IP Democracy blog has Google's filing (PDF) and the following comment from Verizon: "Google's filing has no legal standing."

It may not have any legal standing...

But if someone at the FCC that isnt retarded (I know its a long shot) decides that that may be a good idea, then they may decide to implement that stipulation.

I sure HOPE it's a done deal...

It would be wonderful if Net Neutrality is a "done deal". I am not quite so confident that it is over yet, but I can always hope.

No need for a pledge

Just get the FCC to state that if that block of spectrum is not open, Verizon loses the license, no money back.

The FCC is past its usefulness

The FCC doesn't know jack anymore.

Initially they were saying they wouldn't get the expected $4.7 billion in the auction. Instead, it got up to that amount on local regional licenses alone. The C block had two options, a regional option or a carrier could buy rights to the whole nation, whichever was bid higher would be the result.

If the FCC cared about the interests of the consumers, they would have opened up the C-block auction to non-incumbents only. This would have forced carriers to expand to areas they don't already cover, and increase competition.

Cross your fingers for whitespace devices.

Sneaky bastards

Oh... those sneaky bastards...

Regardless of your stance on Google, I for one am very happy they are on this case. I find it improbable that any other company would put up as much of a fight as they do.

google missed the boat

they should have bid higher on it.

the telco's were terrifed of this sell off because it would challenge their hold on the last mile.

Re:

I think round 1 was when google set the stipulations and then decided not to put a reasonable bid on the auction. Even though I would like for the spectrum to be neutral I definitely think it was a sucker punch on google's part

Re:Round 1.....

I don't think it was a sucker punch really. They bumped the bid up there because that's what they wanted, but if they ended up getting "stuck" with it, they may have been a little upset, but I can guarantee you they would've come up with something to take advantage of it.

Re:Round 1.....

Google's highest bid was less than 100M away from the winning bid, an amount that represented a mere 2.1% increase.

What makes 4.6B unreasonable and 4.7B reasonable? No one forced Verizon to bid 4.7B.

Re:Round 1.....

Tough Shit Google.

'Tough Shit' Google? Try 'Tough Shit American Consumer' because that's who really gets burned if the carriers can keep their walled garden model.

I don't really give two shits about Google but I'd like to be able to buy my own (non carrier branded) phone and do whatever I want with it. You can't do this in CDMA land. Hell, even the GSM carriers (AT&T and T-Mobile) less informed employees will try to tell you that you can't use a non-branded phone.

I even had a T-Mobile employee try to tell me that I couldn't buy a prepaid phone to use with my postpaid service even though it was the exact same model phone as the one they were offering for postpaid customers (the prepaid was $30, postpaid was $100 without a contract). Needless to say I ignored them and bought the phone I wanted and it works just fine.

If they get away with flaunting these requirements then we all lose. Hell, even the carriers will lose out in the end, because sooner or later there will be a backlash and they'll find themselves actually being regulated by the states and/or Feds. Then they'll wish they had done it all voluntarily when they had the chance.

Re:Round 1.....

A cat fight for the C block? Didn't I see this movie on Cinemax not too long ago?

Re:Can't have your cake and eat it too.

I probably wouldn't have out bid the property if that bothered me that much. Not... buy it, then complain, and try to weasel out.

Re:Can't have your cake and eat it too.

Um, are you aware that the "open" provisions that were stipulated were only the "open devices" and "open applications" provisions, not the "open services" and "open access" that would have really created some competition?

Those provisions hardly give Google a free ride. To look at it another way, Verizon knew the restrictions on the auction, and it bid anyway. If the spectrum wasn't worth that amount of money with the restrictions, they shouldn't have bid for it.

Re:Can't have your cake and eat it too.

If Google won they would have had to pay the price for the spectrum. They somehow got the auctioneers to include the rule and everybody decided to play by that, including Verizon. How is that not fair? Bottom line--if Google won, they would have had to pay.

Re:Can't have your cake and eat it too.

That's a horrible analogy. I do not see it like you describe it at all. In this case, Verizon would be making money on the services, so it's not just about some other entity using the network for free, unless you're fine with an ISP charging both sides on a single client's connection. Just that they can't pick and choose what devices and apps are allowed to take advantage of the services.

This was a condition of the bidding. Verizon did not have to bid. I would take it as more than a bit of bad faith if Verizon bid with no intention of upholding the conditions of the auction.

Re:Can't have your cake and eat it too.

How can they have no intention of buying if they bid above the minimum? Is it their fault that Verizon outbid them?

Re:Can't have your cake and eat it too.

Wouldn't you try to either remove or limit such right of way from your property?

I am going to tweak your argument and replace "a nice lot on a lake" with "a strip of land along the ocean". Frankly, this helps the argument because it is conceivable for men to build 3 mile long lakes in the right terrain for their own rich pleasures. Whereas, like the spectrum of bandwidth that Verizon bought, like oceanfront property, is a limited resource.

Now... SHIT... I just spent $4 Billion dollar buying all this land! And I agreed when I bought it to play nice with my neighbors! Oh the horrors.

But wait! I can rent surf boards, jet skis, and other resources that I can develop to my visitors. I can install a boardwalk so that when they come, they can win crappy prizes and overpay for hot dogs. I can build a resort and charge for all sorts of special services that my best customers want. I can do this [theemiratesnetwork.com] and make it so 10x the people can enjoy my property.

Oh sure, Donald Trump can build his own palm tree beaches on my property, but the people will want to visit MINE because I'll offer twice as many amenities. After all, I am the beachfront master and he is just a lowly chump who made some good investments in Midtown Manhattan. His properties in Atlantic City? He has the entire NYC metropolitan area to draw from and they still go to Vegas. What does *he* know about entertaining.

Case in point... being the best is more than just having the most expensive toys. It is about creating the most value for your customers. If Verizon can't profit from the spectrum without the restriction that they KNEW they signed up, they don't deserve to be in business 5 years from now.

And quite frankly, Google *was* ready to slap down $4 Billion and develop the network themselves. Had they won, you could rest assured that Verizon would be like AOL was 5 years ago... a struggling network provider without a clue about where it needs to invest to retain its customers. AOL is gone now. If Verizon gets their way, I will be switching to AT&T promptly and you can wait and see how long it takes before Google is valued at 5x what Verizon is so they can initiate a takeover/merger (they are currently only worth twice as much as Verizon).

I have a different scenario in mind

there is a nice lot on a lake, and if it sells for above certain amount, the buyer would have to provide right of way across his property.

There's this stuff called "spectrum" and it is not really "owned" by anyone. The government, acting on behalf of the people collectively, sells the rights to proscribed use of that spectrum in the interests of maximizing competition and creating the most benefit to citizens.

So, someone that has absolutely no intention of buying this property, but wants to get to walk across to the lake anytime (which he could not currently do as the property is not developed) bids it up until the price is right.

One of the many interested parties who wants to make use of that spectrum lobbies for certain restrictions to be put into place on the use of the spectrum. These restrictions work to the advantage of that interested party, but many other parties see this as broadly advantageous to competition. So this interested party's enlightened self-interest results in meaningful changes being injected into the bidding process.

You like the place and buy it anyway, but now you presumably have to let the other guy visit and hang around on your private beach whenever he likes. Wouldn't you try to either remove or limit such right of way from your property?

Knowing that these restrictions have been accepted as serving larger policy goals by the auctioning party, you bid for use of that portion of the spectrum. Again, you bid for it knowing that there would be restrictions on its use, because those restrictions had been placed there by the seller of the spectrum.

Because you won a bid for *use* of that portion of the spectrum, you do not own it. You have limited rights to use that portion of the spectrum to do particular things. In trying to renege on the terms under which you engaged in bidding, you are merely trying to assert more rights than you have purchased.

If you didn't want that other party to benefit, you shouldn't have bid, because you already knew they had the potential to benefit under the terms that governed the auction.

Re:Can't have your cake and eat it too.

Your analogy is much like property law in Maine. The public is entitled to access to the public parts of beaches - the part between low tide and high tide. And they are entitled to have a right-of-way to get to those beaches without undue burden or unreasonable conditions, like having to walk 3 miles or step only on stones 7 feet apart.

So, in the Wells Beach area, the public tramps down to the beach through properties they couldn't possibly afford, even if the owners were interested in selling.

The owner's complaints? Minimal. Mountains (literally) of trash during the summer months, dumped by the public. People peeing on their lawns, gardens, porch siding rather than walk up to the porta-potties. Let's not consider the behavior of the public on the beach. For many property owners, it's an insult.

I can see Verizon wanting to modify the rules, and make the C-Block into their playground, and I can see the 'public' (really Google looking for a way to preserve their access to income) wanting to keep 'access' to a precious resource. No doubt it will be strewn with trash, from spam and every sort of malware imaginable to MySpace or worse devised just to take advantage of the wireless market. And Google isn't at all altruistic about this.

But those people in Wells Beach who dearly love their oceanfront homes know that the price is putting up with the 'public'. They whine, and go to court or the Town Council from time to time, but in the end they dare not move. It's too beautiful. It's worth it.

Let's hold Verizon to the deal they signed. In the end, I bet they find it's worth it.

Re:Can't have your cake and eat it too.

Regardless of whether the other guy ever had any intention of buying the lot or just wanted a free ride, "I" still knew the stipulations that were placed on the property when I made the bid, and "I" still felt the property was worth enough to warrant the price even with the restriction. The time for me to air that complaint would have been before the auction, not after I had beaten out several other bidders that had all agreed to the same terms and had chosen their bid amounts based on those conditions.

Ignore the Google-guy for a moment and imagine that you were one of the other bidders on the property in question. Suppose that you had decided the property would ordinarily be worth a million dollars to you, but you decide that because of this stipulation you are only willing to bid 600k. Now some other person comes along and outbids you at 750k, and then decides he is going to ignore the stipulations anyway. Would you be a little pissed? According to you, you didn't pay for it, so you lost your right to complain.

Re:Legal Standing?

If you show a boob, or say 'fuckweasel', or run a closeup of some guy's balls, you'll find out how much legal standing they have when they shut you down like Chuck said.

Re:Legal Standing?

Yes, the FCC gets its authority from Congress. See the Communications Act of 1934 [wikipedia.org] and subsequent legislation.

Re:Can somone explain this?

In a nutshell, Google is saying that, based on statements that Verizon has given, that they will not really follow the open access provisions that Verizon agreed to when they made the bid. Google wants the FCC to make Verizon firmly and explicitly pledge that they will follow said open access provisions before performing the final, actual sale of the spectrum.

Re:Can somone explain this?

Google needs to learn a few things about corporations psychology (applicable for any corporation).
Larry Page needs to read a few pages from the book Corporation.
1. Corporations are pathological liars. If they think they can get away with lying, they will continue to do so (like kids), until they are punished for it.
2. Ethics and promises are applicable to grown-ups. Corporations are psychologically children (under 5 years). Hence ethics have no meaning to them. And so are promises. Suppose you promise a kid a huge bag of M&M to rat out what his mom & dad did last night, he would definitely do, since he can't understand the nuances. So are corporates.
3. If they think they can lie to get something, they will do so, and once they get it, they will avoid doing what they promised. (Remember asking your kid to wash your car? [This does not apply to Australia where washing your car is a crime]).
4. Corporations follow the basic of a child gameplay: What's mine is mine, and what's yours is also mine.
5. Arguing with a child does not work. So does arguing with a corporation. Take for instance the recent open discussion about Net Neutrality and Throttling in which no corporations participated. After all which kid would like to attend a PTA in which he's being criticized?

Rules of the game:
1. Establish clear rules and punishments for good and bad behavior. By laws. Punish severely and reward generously. Quickly. A quick punishment establishes to a child that he cannot repeat the same behavior. if you are going to punish your kid tomorrow for what he did last week, there is no correlation. It confuses the hell out of a kid and the corporation.
2. Never allow the kid (or corporation) to establish rules. That will lead to more wrongs.
3. There are no grace periods or times. One strike and you are out.

FCC here must clearly warn verizon that it is a contract. If they go back on it, their license is revoked with retrospective effect from 1990.
Nothing scares a kid more than a dark room. For a corporation losing a license is like a dark room.
Just delicense them and watch them shiver.

But it's Verizon...

You know, the really reputable company, they would never [pencomputing.com] cripple [engadget.com] their products [digg.com]. I wonder what all the conflict is about this time. Surely theyd never back out of opening the spectrum.