IP Democracy: Jockeying Underway for New Spectrum Auction

The New York Times’ John Markoff has this piece today about the intense jockeying that is already underway for the auction of 700 MHz band licenses. The FCC is slated to release the rules for the new auction as early as next month and the traditional cellular carriers are facing some stiff lobbying opposition from cable operators, satellite companies and new participants in this kind of thing, Internet companies, such as Google and Yahoo!.

The spectrum will be made available from the analog UHF channels that are scheduled to disappear once the conversion to digital TV takes place in February 2009.

One of the more interesting participants in the process is a new group called Frontline Wireless, which counts as one of its key executives former FCC Chairman Reed Hundt. Frontline has asked the FCC to use the spectrum in setting up a “4G,” open access national broadband wireless network. Although Frontline’s main priority is setting up a nationwide public safety network, it also foresees the spectrum being made available on a wholesale basis for commercial purposes. The Frontline plan also calls for full interoperability, which means all handsets would work on the system.

The Internet companies interested in the spectrum have formed a group called the Alliance for 4G America, which includes not only Yahoo! and Google, but also Intel, DirecTV and Skype. They all have the incentive to mount competitive networks that bypass traditional cable, phone and wireless companies, given those broadband distribtuors’ ability to serve as bottlenecks for their services.

But, the byzantine world of gaining federally granted licenses is not Silicon Valley’s usual playground, and it’s going to be difficult for these companies to influence the auction.

“Silicon Valley bidders have deep pockets, but it would be very outside-the-box and high-risk for them,” said Kevin M. Roe, a telecommunications analyst at Roe Equity Research in New York. “Not only do you need the money to buy the spectrum, but you have to build a network — and that would be a gargantuan task that would take years with no guarantees they could catch up with the big four national operators.”

Posted by Cynthia Brumfield on March 26, 2007 9:56 AM to IP Democracy