Google, AT&T Up Ante In Spectrum Auction

Some interesting developments occurred this week in the battle over the rules that will shape the forthcoming auction of wireless spectrum. 

First, more details have emerged on just what rules FCC Chairman Kevin Martin is proposing (background here and here). 

According to CNNMoney: 

Martin’s plan adopts two of the four principles advocated by Google, eBay Inc.’s Internet-based telephone service Skype and several public interest groups.

He has suggested that whoever acquires 22 megahertz of the spectrum would be obliged to build out a wireless broadband network and allow any handheld device to use the network. They would also be required to allow any type of software application to be used over the network….

Google and the others wanted Martin to go further and attach a condition to the chunk of spectrum stating that whoever controlled it would have to operate it on a wholesale basis. This would mean that whoever controlled the network could lease access to it to a variety of different companies who would in turn offer wireless broadband access to customers.

This splitting the difference has apparently coaxed AT&T into supporting the FCC (it was originally opposed to any “open access” rules).

 Now, however, Google has said that it would actually bid on spectrum if the FCC adopts all four of its principles. In an open letter to Martin, Google CEO Eric Schmidt wrote:

 We hereby inform you that, should the Commission expressly adopt the four license conditions requested in our July 9th letter – with specific, enforceable, and enduring rules – Google intends to commit a minimum of $4.6 billion to bidding in the upcoming auction. 

Isn’t it great to have a $159 billion market cap?