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Comments: 170 +-   Google et al. Want 700 MHz Auction Opened Up on Sunday June 03 2007, @06:13PM

Posted by kdawson on Sunday June 03 2007, @06:13PM
from the third-helping-of-pipes dept.
wireless
business
government
hardware
politics
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).
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  • that money can buy.

    No matter who wins this fight, we all lose.
    • Everyone could win. (Score:4, Interesting)

      by twitter (104583) on Sunday June 03 2007, @06:50PM (#19375495) Homepage Journal

      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.

  • by Baldrson (78598) * on Sunday June 03 2007, @06:39PM (#19375393) Homepage Journal
    The way spectrum is currently utilized, it is like land. Although it doesn't have to be this way [slashdot.org], reality dictates that until proper technologies for spectrum utilization are put into place, that spectrum be treated like land:

    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.

    • Moderators. Parent needs some attention.
    • 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)

        by evilviper (135110) on Monday June 04 2007, @01:13AM (#19378009) Journal

        Others have argued there is no scarcity of the resource you are talking about, so no regulation is required.

        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.
              • I recently heard the suggestion that one should evaluate candidate's positions not on what they say they will do, or are likely to try to do, but on what they actually *could* do if elected. Examined in this light, Paul looks a lot more appealing. And I definitely want someone with more respect for the constitution.
  • by Doppler00 (534739) on Sunday June 03 2007, @06:41PM (#19375413) Homepage Journal
    Why not just leave the spectrum completely open to the public like 900MHz and 2.4GHz? Although, require that the spectrum must use intelligent radio devices that comply to a single standard (through IEEE for example).
    • Sounds great [slashdot.org]. Where do I sign up?

    • Because the government wants to sell the spectrum for money rather than open it to the public which would get the government zero dollars.
    • "Why not just leave the spectrum completely open to the public like 900MHz and 2.4GHz?"
      That would be great... But I'd rather have something around 450 MHz. 450 MHz is easier to propagate, compared to 900 and 2400 MHz, and it's also cheaper to make equipment and cabling for it. 450 MHz would be great for longer links and mesh networking.
  • by mgoren (73073) on Sunday June 03 2007, @06:52PM (#19375513)
    Is this related to the Save Our Spectrum [freepress.net] coalition? I believe that group is asking for the following:
    • 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.)
  • by argoff (142580) * on Sunday June 03 2007, @07:08PM (#19375631)
    The whole premise behind the FCC was that if spectrum was unregulated you would have a tragedy of the commons were everybody would pollute it so much that it would become unusable. However in practice that has turned out to be a complete and absolute lie. In the unregulated spectrum's, the more the spectrum got "polluted", the more people created technologies that could intelligently allocate, detect, shift, and route around. So now all spectrum regulation does is lock in obsolete technologies and wasteful inefficient use of the frequencies in place.
    • by briancnorton (586947) on Sunday June 03 2007, @09:01PM (#19376419) Homepage
      a tragedy of the commons were everybody would pollute it so much that it would become unusable.
      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.

      • by NateTech (50881) on Sunday June 03 2007, @11:27PM (#19377385) Homepage
        The people touting no control at all, also have no metrics or basis for their claims. Your analysis is as close as it comes when we talk about unlicensed free-for-alls, and if 900 MHz and 2.4 GHz are examples... trying to do real services that people pay for in unlicensed uncontrolled spectrum would be a joke. Whoever had the most money for the most transmitters and amplifiers, would win.

        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.
    • The whole premise behind the FCC was that if spectrum was unregulated you would have a tragedy of the commons were everybody would pollute it so much that it would become unusable. However in practice that has turned out to be a complete and absolute lie.

      So there is no such thing as interference? It doesn't ever happen? Anywhere? Ever? Your ideas are intriguing to me and I wish to subscribe to your newsletter.
    • by Comatose51 (687974) on Sunday June 03 2007, @09:28PM (#19376637) Homepage
      In an unregulated scenario, it would be whoever has the most powerful transmitter would win. It really doesn't matter what scheme you come up if someone just decides to blast the airwaves. Things like CDMA and TDMA only work because all the participating radios are working off the same agreed upon protocol. CDMA requires all the transmitters use a chirping code such that the resulting transmissions are orthogonal to each other. TDMA requires a centralized management of time slots. Even Bluetooth requires that everyone on the same PAN subscribe to the same pseudorandom number sequence. If someone just decides to blast radio waves, there's nothing anyone or any scheme can do.
    • The whole premise behind the FCC was that if spectrum was unregulated you would have a tragedy of the commons were everybody would pollute it so much that it would become unusable. However in practice that has turned out to be a complete and absolute lie.

      I'm afraid that this statement is provably false. Here is but one example. Whilst I am not across how things are in the US, here in Australia, 27mHz CBRS (Citizens Band Radio Service) is unregulated, as is UHF CBRS. When it was regulated in the 80s, you c

  • Oh yeah - those are the companies that handed over all the information concerning their subscriber's phone calls to the Bush administration without so much as a warrant to legitimize the request.

  • There's also a huge problem that the entertainment industry is having with all of this auctioning of RF. Wireless mics operate on these bands. It's already hard enough to organize hundreds of wireless mics on the spectrum by not running into existing tv channels, other mics, creating intermod and etc... And now with even LESS spectrum don't expect the superbowl, grammys, presidential rallies, fundraisers, churches, plays, concerts and other functions to have wireless mics. We need a spot for comsumer device
  • Third pipe (Score:5, Funny)

    by Mr. Underbridge (666784) on Sunday June 03 2007, @07:42PM (#19375883)

    ...the much-anticipated third pipe...

    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.

  • I know it's Slashdot, where big companies are always wrong (unless it's Google), but could we please tone down the bias in the article summary? Wow.
  • by Raisey-raison (850922) on Sunday June 03 2007, @09:59PM (#19376869)
    Firstly this just demonstrates that the public airwaves are not 'public' at all. They merely belong to the corporations who are the biggest campaign contributors. I love how people who use airwaves without FCC approval are pirates and criminals - but if give to the right politicians and fix the auction then you are legit. Its amazing that if you bilk the customer because either you can get away with ignoring anti trust laws because your Verizon or AT&T then it's ok. Steal a CD and you go to jail.

    Secondly this story is another example of the lack of competition in cell phone service and wireless data service. There is enough spectrum for at least 8 national companies. Yet there really are only 3 or 4 depending on how you count them. This I bet is why service is still absurdly expensive. Thirdly, I dream of the re-division of the airwaves. Its a quite a mess. Of course the changeover period may be difficult - but it would be doable. Finally I don't see why CBS, FOX, ABC and NBC should get them for free when so much of what they do is hardly serving the public. They get to refuse ads they don't like. They dont have to justify what they put on the air much. Why not give them for free for 20 years to others and see if they do better?
    • Re:Hmm... (Score:5, Funny)

      by CrazyJim1 (809850) on Sunday June 03 2007, @06:26PM (#19375287) Journal
      What is this third pipe? What are the other two?

      Well one's normally referred as a tube.
    • Re:Hmm... (Score:5, Informative)

      by scooter.higher (874622) on Sunday June 03 2007, @06:29PM (#19375311) Journal
      FTFA:

      "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)
      • There is really only one broadband provider in the US and it's intentionally crippled by M$ and the MAFIAA.

        O_O

        Honestly if you can prove to me that this sentence is making even some limited amount of sense, I'll give ya a hundred bucks immediately.
        • by twitter (104583) on Sunday June 03 2007, @07:28PM (#19375771) Homepage Journal

          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.

            • Depends on where you are.

              Personally, I've never had any option but cable -- no DSL, ever. And I've lived in a variety of areas, from fairly rural (Central Maine, Eastern Connecticut) to suburban (Arlington, VA) and never had DSL. In two cases (VA and CT), the phone companies initially told me I had DSL, but later said "oops, our bad" when it never worked, or when they checked more accurate line-feet databases. (In CT, they actually sent me a DSL modem and tried to give me service, but it just never worked,
              • exactly, the two groups, phone and cable choose to "not compete" while looking like it on paper. Generally you have one or the other and the late company to the game in your area simply won't upgrade the equipment.. even if they advertise nationally or state-wide. Hopefully the FCC will crack open the books on the REAL roll out data so the public can put dots on a map and show just how poor the service really is from these guys. Maybe they'll do this AFTER they sell the "next big thing" to the already ex
      • Re:Straight face. (Score:5, Insightful)

        by jim_deane (63059) on Sunday June 03 2007, @06:43PM (#19375439) Journal
        People have given up on DSL?

        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.
        • Re:Straight face. (Score:4, Interesting)

          by xSauronx (608805) <xsauronxdamnit AT gmail DOT com> on Sunday June 03 2007, @10:29PM (#19377027)
          Im also in Kansas and have DSL, as my understanding was the cable in this town is lousy. The DSL, through SBC/AT&T has been reliable, though getting it in the first place was a serious hassle.

          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 ;)
      • Re: (Score:3, Interesting)

        Don't you guys have MAN [wikipedia.org]s? They're pretty popular here in Beijing, and provide pretty good performance too, certainly good value (99rmb/month). The ones I've used have been 10BaseT ethernet connections.
    • Re: (Score:3, Interesting)

      But they know that if they can get the "telephone and cable incumbents that dominate the wireline market" bumped out of, or at least have them given a reduced presence in, the auction they have a better chance of winning the auction with less up front out of pocket.

      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.
    • Re: (Score:2, Insightful)

      by Anonymous Coward
      The cable/telephone companies will outspend google just to keep them out. Google can only hope to get 'into' the business, while the other two can simply raise prices to cover the cost of keeping google out.
    • by twitter (104583) on Sunday June 03 2007, @06:41PM (#19375415) Homepage Journal

      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.

      • Google can team up with microsoft and Yahoo as well as few other companies as well. not like AT&T and Verizon are friends. they are competitors with each other.

        Reason Google is making noise is that they want someone else to spend tens of millions of $$$ and then leech of it like they do with everyone else. Google is good at what it does, but in the end they are masters of making money of other people's creations and investments.
        • Re: (Score:2, Insightful)

          10's of millions? Heh...last I heard this auction is worth over $15 billion. Not even Google can blow that kind of dough unnoticed...
    • Re:Surely..... (Score:5, Insightful)

      by pla (258480) on Sunday June 03 2007, @06:41PM (#19375417) Journal
      Google has enough money to compete in these auctions. Why wouldn't they simply outbid the competitors and sell the space themselves?

      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?)
    • by ajanp (1083247) on Sunday June 03 2007, @06:42PM (#19375427)
      Google TiSP... amazing that they found a way to let you use the "third-pipe" to deliver broadband access to your home months before the competition. http://hardware.slashdot.org/article.pl?sid=07/04/ 01/1331238 [slashdot.org]
    • Re:Surely..... (Score:5, Insightful)

      by rtb61 (674572) on Sunday June 03 2007, @07:27PM (#19375763) Homepage
      When it comes to the bidding process, should the government finally not recognised that it is selling access to the part of the spectrum of behalf of the population. Surely the bidding process should not only be based on how much they are willing to pay for it but on how much they are going to charge for access to it.

      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.

    • Re: (Score:3, Interesting)

      sure, if they get invited to the first round.

      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

      • Google is being the good guys so everyone likes them.

        That's basically the reason to be a good guy. I can't think of any other reason right now...

    • Good point. (And if that's too obvious, it's trivial to disguise it further -- say, using the sum of the digits.)

      I think a better idea is to make bids non-cancellable. Bid cancellation seems to be an integral part of the game here. It's astounding that such a thing would be permitted in an auction like this.

Always leave room to add an explanation if it doesn't work out.