Martin Rejects Google’s Proposal
Time’s running out for FCC Chairman Kevin Martin to set rules for the 2008 spectrum auction, and it looks like he’s sticking with the half-concession he originally made regarding open access. And whether or not Google will bid is up in the air.
Google made four demands in order to promise a bid of a certain amount. AT&T pitched a fit about it, Martin has agreed to half of them, and Verizon is okay with that. Martin’s new rules come up for a vote on July 31st, and the auction is in early 2008, which is why, some say, Martin is willing to make some concessions in the first place. Tick tock.
The four demands Google made were that whoever bought a particular slice of the spectrum, acridly called "the Google Block" by detractors, open up their network to any device, allow any application consumers desired that didn’t harm the network, allow third parties to acquire spectrum on a wholesale basis, and allow third parties like ISPs to connect anywhere in the licensee’s network.
The idea behind this was to increase competition and consumer rights in the wireless space. AT&T and Verizon have been vehemently opposed to such regulation.
In comments prepared for the House Subcommittee on Telecommunications, Martin expressed his continued opposition to open networks, and wholesaling, two of the conditions Google wanted in order to bid at least $4.6 billion, the reserve price for a third (22 MHz of 60) of the 700 MHz band available.
"Currently, American consumers are too often asked to throw away their old phones and buy new ones if they want to switch cell phone carriers," said Martin. "And when they buy that new phone, it is the wireless provider, not the consumer, who chooses what applications the consumer will be allowed to use on that new handset.
"Wireless consumers in many other countries face fewer restraints: for example, they can take their cell phones with them when they change carriers, and they can use widely available Wi-Fi networks – available in their homes, at the airport or at other hotspots – to access the Internet."
Martin refuses to apply open platform principles to the entire 700 MHz platform, however, hoping that a small regulated slice of it will send the proper message to incumbent bidders and would-be owners.
"Nor have I proposed to apply network neutrality obligations or mandatory wholesale requirements for this block or any other block."
And you probably could have guessed that from Martin’s history. If it’s good for AT&T, it has, at least in the past few years, been good for Martin. What’s more, Martin says that if the reserve is not met for the "Google Block," and if Google doesn’t enter the auction, it very well may not be met, he will remove the restrictions for open access and try again.
That’s a troubling dangler on the end of this speech, making the whole open access concession seem like a big show to shut up opposition long enough to hand over the spectrum to incumbents anyway. Unfortunately, the FTC is most like okay with it too.