Aug. 3 (Bloomberg) -- Federal Communications Commission Chairman Kevin Martin may fall short of his goal of spurring a historic shakeup of the mobile-phone market when the U.S. sells airwaves worth as much as $15 billion next year.
The FCC adopted rules this week that will let consumers use any kind of phone or wireless-enabled laptop on some airwaves, not just the devices approved by their phone company. People may be able to take an iPhone for example, which now runs only on AT&T Inc.'s network, and use it on this new spectrum regardless of who wins the bidding.
Martin heralded the new choices for consumers and said the nationwide network built by the winning bidder may offer speedy wireless Internet service anyone could use, an alternative to landline-based service. If a newer carrier won, it would threaten AT&T and Verizon Wireless.
That vision probably won't come to fruition, analysts including Stifel Nicolaus & Co.'s Blair Levin said.
``The biggest question mark is: will this auction produce any new entrants into either the wireless market or the broadband market?'' said Levin. He helped write rules for airwaves auctions in the mid-1990s as chief of staff to former FCC Chairman Reed Hundt. ``I don't think it will.''
Martin scrapped a proposal by Google Inc. that would have gone further. Google not only wanted any phone to run on the network, it wanted competing carriers to get to use the spectrum at a discounted rate. Today, customers have to subscribe to AT&T to use its network unless the company voluntarily resells space to other carriers.
Google Fight
Google, which pledged to offer at least $4.6 billion if the FCC adopted its proposals, now says it hasn't decided whether to bid. If Google participates, it probably won't win the biggest spectrum block, Levin said. Cable companies may be unable to outbid the big phone carriers, and there is ``no momentum'' on Wall Street to back most startups, he said.
That eliminates most threats to AT&T and Verizon, the largest U.S. wireless carriers, which want the spectrum to offer more of their own mobile Web content at faster speeds.
Telephone carriers, small wireless providers and Internet companies are clamoring for these airwaves because they occupy an ideal frequency for mobile Internet service. They carry signals over long distances and pass through walls.
The FCC must auction the airwaves by the end of January, giving the winners time to prepare before the spectrum is freed up when television broadcasters convert to digital signals in February 2009. This may be the last auction of its kind because no other airwaves of that quality are expected to be vacated in the foreseeable future.
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The FCC adopted rules this week that will let consumers use any kind of phone or wireless-enabled laptop on some airwaves, not just the devices approved by their phone company. People may be able to take an iPhone for example, which now runs only on AT&T Inc.'s network, and use it on this new spectrum regardless of who wins the bidding.
Martin heralded the new choices for consumers and said the nationwide network built by the winning bidder may offer speedy wireless Internet service anyone could use, an alternative to landline-based service. If a newer carrier won, it would threaten AT&T and Verizon Wireless.
That vision probably won't come to fruition, analysts including Stifel Nicolaus & Co.'s Blair Levin said.
``The biggest question mark is: will this auction produce any new entrants into either the wireless market or the broadband market?'' said Levin. He helped write rules for airwaves auctions in the mid-1990s as chief of staff to former FCC Chairman Reed Hundt. ``I don't think it will.''
Martin scrapped a proposal by Google Inc. that would have gone further. Google not only wanted any phone to run on the network, it wanted competing carriers to get to use the spectrum at a discounted rate. Today, customers have to subscribe to AT&T to use its network unless the company voluntarily resells space to other carriers.
Google Fight
Google, which pledged to offer at least $4.6 billion if the FCC adopted its proposals, now says it hasn't decided whether to bid. If Google participates, it probably won't win the biggest spectrum block, Levin said. Cable companies may be unable to outbid the big phone carriers, and there is ``no momentum'' on Wall Street to back most startups, he said.
That eliminates most threats to AT&T and Verizon, the largest U.S. wireless carriers, which want the spectrum to offer more of their own mobile Web content at faster speeds.
Telephone carriers, small wireless providers and Internet companies are clamoring for these airwaves because they occupy an ideal frequency for mobile Internet service. They carry signals over long distances and pass through walls.
The FCC must auction the airwaves by the end of January, giving the winners time to prepare before the spectrum is freed up when television broadcasters convert to digital signals in February 2009. This may be the last auction of its kind because no other airwaves of that quality are expected to be vacated in the foreseeable future.
Discuss Add this link to... Bury
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