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Published July 20, 2007

NET NEUTRALITY UPDATE
A new aspect of the of the debate over net neutrality centers around the upcoming availability of a large amount of wireless bandwith for broadband purposes throughout the country.

By 2009, all television broadcasts will have switched from analog to digital broadcasting. This will leave vacant a huge section of the airwaves, known as the 700 MHz band, which the Federal Communications Commission (FCC) has decided will be ideal for wireless broadband.

According to the FCC, part of the 700 MHz band will be used as a national public safety communications network. The rest of the band will serve as the "third pipe" of broadband Internet access. It will provide consumers with a third choice of Internet service, in addition to cable and DSL, and will ideally bring broadband Internet access to more households across the country. This section of the spectrum will be auctioned off by the FCC, which expects the auction to raise at least $10 billion for the federal government.

However, the debate as to how this be accomplished has created a stir in the telecommunications industry. The 700 MHz band is being called the last of the "beachfront property" in the broadband industry, and the last opportunity for a new competitor to join the broadband market.

The new competitor appeared to be Google Inc, who agreed to front the minimum $4.6 billion if the FCC's regulations of the 700 MHz band met the following conditions:

  • Open applications: Consumers should be able to download and utilize any software applications, content, or services they desire;

  • Open devices: Consumers should be able to utilize their handheld communications device with whatever wireless network they prefer;

  • Open services: Third parties (resellers) should be able to acquire wireless services from a 700 MHz licensee on a wholesale basis, based on reasonably nondiscriminatory commercial terms; and

  • Open networks: Third parties (like Internet service providers) should be able to interconnect at any technically feasible point in a 700 MHz licensee's wireless network. (source: consumer affairs)

The "Google Plan" was met with support from many consumer groups who wanted more competition and options for broadband than the current cable and DSL carriers provide for. The Google Plan also faced opposition from AT&T, who said Google was "demanding the government stack the deck in its favor" by "limit[ing] competing bids, and effectively force[ing] wireless carriers to alter their business models to Google's liking."

The FCC issued a compromise, agreeing to the "open applications" and "open devices" regulations, but falling short of the open access initiative backed by Google and consumer groups.

The compromise brought criticism from both sides. The Cable and Telecommunications Industries Association, a telecom lobbyist group, issued a statement citing disappointment that "a significant portion of this valuable spectrum will be encumbered with mandates that could significantly reduce the number of interested bidders."

Google and other potential bidders, some consumer groups and media watchers, viewed the compromise as a loss of opportunity for competition and access. Ben Scott, public policy editor of FreePress, called the compromise "a large step backward for the larger need for genuine broadband competition that could bring the benefits of the Internet to all Americans."

Google, through Richard Witt of their public policy blog, stated "it would have a more complete victory for consumers had the FCC adopted all four of the license conditions that we advocated, in order to pave the way for the real "third pipe" broadband competition that FCC Chairman Kevin Martin has been touting." Google did, however, support the progress of the FCC regarding open applications and open devices.

While no major company has made a full commitment to the auction, a date has been set to commence the bidding on January 16, 2008.



Sources:
References and Reading:
MOYERS ON AMERICA: "The Net at Risk"
Are mega-media corporations trying to restrict the democratic possibilities of the Web's new future? October, 2006.

"Moyers on Murdoch"
A Bill Moyers essay on what the potential buyout of Dow Jones and THE WALL STREET JOURNAL means for business coverage. June 29, 2007
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