Google's big win -- and big loss -- in a bid for the open wireless Web

The FCC rules that consumers can use any device or application they want on upcoming wireless networks. But it denies Google's most sweeping reform efforts.

Published July 31, 2007 7:27PM (EDT)

Google's bid for "open access" rules on wireless networks met a mixed fate Tuesday, as commissioners at the FCC sided with some but not all of the search company's pro-consumer guidelines for next year's auction of the 700 MHz band of radio space.

Here's what this means for anyone who cares to use the Internet over a wireless device: Once carriers move over to the 700 MHz band -- which promises faster, stronger wireless data connections across the country -- phone companies will not have the right to dictate to consumers what devices we can use on their network. This is a win for Google.

Wireless firms will also be prohibited from preventing us from using applications we choose on those devices -- you'll be able to use Skype or Firefox or whatever else on your phone, whether your carrier likes it or not. This is also a win for Google.

But Google had also asked the Federal Communications Commission to require that wireless carriers lease radio space to third-parties at reasonable market rates. These so-called "wholesale access" provisions are designed, Google says, to make the 700 MHz band a viable "third pipe" into people's homes, a much-needed alternative to Internet service provided by DSL and cable.

Google -- citing, typically, complex economic and game theory principles -- argued that if the FCC did not mandate wholesale access, telecom firms will be motivated to pay above-market rates for radio space at auction in order to protect their current business model. Economists call this a "blocking premium," and its upshot is that the traditional phone services will gain a great leg-up at auction, almost certainly winning large swaths of the network and thus controlling yet another Internet route into American homes.

But the FCC did not side with Google on wholesale access. So Google got half of what it wants -- people will be able to use whatever devices and whatever programs they want on the 700 MHz band, but it's unlikely we'll get new companies moving into that space looking to provide us service. Like today, it'll be AT&T, Verizon, Sprint, and T-Mobile -- and maybe not even all of them.

By Farhad Manjoo

Farhad Manjoo is a Salon staff writer and the author of True Enough: Learning to Live in a Post-Fact Society.

MORE FROM Farhad Manjoo

Related Topics ------------------------------------------