updated 04:45 pm EDT, Tue April 15, 2008
700MHz auction 'gamed?'
Google deliberately manipulated the outcome of the FCC's recent 700MHz auction, three US Representatives have alleged. Republicans Cliff Stearns and John Shimkus, along with Democrat Eliot Engel, said at a hearing today that Google unfairly managed to obtain an open wireless network without having to win it, by promising to bid at least $4.6 billion on the 22MHz block if the winner was forced to allow open (third-party) access. Evidence of this is claimed to be bolstered by a recent Google blog post, in which officials admit that open access was a key priority during bidding.
"I suspect that if Google had been interested in more than just maneuvering within the system," said Stearns during the hearing, "it could have prevailed in the C block and become a new [wireless] entrant. I suppose we cannot blame them for trying to get free access to the spectrum; what is more concerning is, that even though we knew what they were doing, we let them maneuver this way anyway."
The problem, according to Stearns and others, is that the open-access rule may have deterred a number of companies from bidding, giving Google what it wanted while limiting auction income to $19.1 billion instead of estimates as high as $30 billion. InfoWorld notes that Google does have the support of people such as FCC chairman Kevin Martin (pictured), who contends that open access will ultimately benefit many people and businesses.
"Our goal, in adopting the openness conditions, was not to prohibit someone else from winning, but to actually [require] whoever won that spectrum to have an open platform," said Martin today, in response to a question by Shimkus.