Protectionism posing as free-trade
Rating: Google won’t give up on US mobile ambitions
By Annie Turner
Google’s first major lobbying effort in Washington has struck fear and loathing into the heart of the US mobile industry and forced the regulator to make some belated concessions to consumers.
Next year’s auction of spectrum in the 700MHz, freed up by broadcasters move from analogue to digital transmissions, is widely seen as the last chance for a new entrant into mobile service provision. The spectrum is coveted because it can cover long distances and provide good coverage within buildings.
In an attempt to reduce the all-powerful oligarchy of mobile operators, Google had demanded that the Federal Communications Commission (FCC) should oblige the winner to resell capacity on their network at wholesale rates to foster greater competition. Naturally, Sprint, Verizon, AT&T Mobility and T-Mobile have put in major lobbying efforts to stop such free thinking themselves: there is no shriek so shrill as from those who have customarily enjoyed great privilege and see it challenged, no matter how small the impact might be.
Yesterday the Federal Communications Commission made some concessions. Chairman Kevin Martin, announced that mobile companies that buy the spectrum will have to let customers use any device on the network and access any application, provided they meet security and stability requirements.
It doesn’t seem much of a concession really; why shouldn’t customers be able to use whatever phone they like for whatever applications they want to use? In most of the rest of the world, operators don’t have such a strangle-hold on what their customers do because the regulators made sure they couldn’t. Also, it won’t apply to their other bandwidth, which makes it nonsense anyway.
The FCC thinks the auction could raise as much as USD 10bn and says it was reluctant to go against the principles of a free market that has served the US so well in spectrum auctions. Actually, it means that has served big business so well at the expense of consumers.
Despite not having its demands met, Google may still bid for the spectrum, which will not be available until 2009, in an attempt to take the operators on itself. It has deep enough pockets, but tackling all that vested interest will be like trying to move the Rock of Gibraltar with a teaspoon.
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