SAN FRANCISCO – The Federal Communications Commission moved cautiously yesterday toward creating a more open national wireless broadband network, handing a partial victory to Google, which was pushing for more competition in cell phone services.
The agency approved rules for an auction of broadcast spectrum that its chairman, Kevin J. Martin, said would promote new consumer services. The rules will let customers use any phone and software they want on networks using about a third of the spectrum to be auctioned.
The FCC did not approve a provision that would have required the auction winner to sell access to its network on a wholesale basis to other companies. Google favored the rule as a way to hasten competition and innovation in the cell phone industry, a market it is eyeing.
While the language of the ruling has not been made public, it appears that any company that buys the new spectrum will have to leave it open to devices it does not approve or control. If, for instance, Verizon Wireless were to buy spectrum, consumers would have to pay Verizon for access to its network but they could use devices of their own choosing on it.
At present, the carriers decide what devices are used on their networks and therefore control many of the services and software available to consumers. The carriers assert that this lets them control the quality of the customer's experience.
The ruling does not affect the existing spectrum, controlled by major telephone companies. But it appears to signal a shift in how policy-makers and, in turn, companies will approach access to and control of the wireless networks of the future.
The ruling did not go far enough for the consumer-activist groups that had wanted more open access to those networks, but even those groups applauded parts of it.
In recent weeks, Google and other technology interests pressed the commission to create an open-access wireless network – in contrast to today's closed cellular networks – and to permit spectrum owners to sell portions of it wholesale to other companies. That would loosen the carriers' grip on service offerings and might also open the door to new entrants such as Google.
The 700-megahertz wireless band has been referred to as the “last beachfront property” in the radio spectrum. It is being made available for new digital wireless services, including emergency communications, by television broadcasters moving to digital television transmission in February 2009. By law, the auction must start no later than Jan. 28. It is expected to raise $15 billion or more for the federal government.
Google called the decision an indication of progress at the FCC. The agency adopted two of the four openness standards that Google proposed this year, including open access to software applications and devices.
“The Federal Communications Commission made real, if incomplete, progress for consumers this afternoon,” said Richard Whitt, Google's Washington telecommunications and media counsel.
In trying to influence the commission debate, Google had said it would bid at least $4.6 billion if the FCC approved all its proposed rules. However, Whitt said it was not out of the question that Google might still bid. The company plans to study detailed rules the agency is expected to release in the next two weeks and talk with potential partners before making a final decision.
Google's efforts also drew attention to the debate over the pace of innovation in the wireless market.
Speaking before the FCC yesterday, Jason Devitt, co-founder and chief executive of Skydeck, a Silicon Valley wireless-content firm, said the cell phone industry had failed to innovate. “Ten years and we have ringtones,” he said.
The FCC tried to strike a balance between the interest groups, Martin said in a telephone interview. “The commission needs to decide what is in the public interest, not what one company advocates,” he said
Public interest groups and Silicon Valley technologists said they were disappointed with the ruling. Public interest groups said the $4.6 billion minimum bid set by the FCC might discourage auction bidders.
