Does Apple want to become a wireless carrier?

The company has reportedly studied the possibility of bidding on radio space in an upcoming government auction.


Farhad Manjoo
September 10, 2007 8:48PM (UTC)

BusinessWeek has a hot story this morning citing two sources who claim that Apple is considering participating in the government's upcoming auction of the 700 MHz band of radio space. The spectrum, as it's called, will go on sale in January, and it's being fiercely fought over by traditional telecom firms and newer entrants, such as Google, all of whom aim to use the space to provide a faster, more robust wireless Internet.

Apple's entry into the battle is a surprise, but it makes sense. With the iPhone and the iPod Touch, the company has jumped into the wireless device market -- if it ran the wireless network it wouldn't have to depend on shoddy partners like AT&T for support for those devices. One unnamed "former Apple executive" tells BW: "Apple is the most anti-carrier company there is ... They're probably already frustrated with AT&T. If they put a few billion behind this, they could build a kick-ass network."

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True, but as BW notes, although Apple has studied the possibility of joining the auction, it's likely to sit out for a simple reason -- the wireless business isn't nearly as profitable as Apple's core business of selling hot machines and software.

Apple has gobs of cash -- $14 billion -- but it'll take gobs to buy the spectrum and to set up a network, and that money could better be invested in designing the next iPods.

And hey, why should Apple go out of its way to set up a wireless network when Google -- which is a close partner, and whose CEO Eric Schmidt sits on Apple's board -- looks to be interested in doing the same thing?

An iPhone on a Google network would be sweeter than an iPhone on AT&T, I'm sure. If it's true that Apple's "anti-carrier," maybe that's because there's just no carrier, yet, that can understand its soul.

Apple Eyes the Wireless Auction [BusinessWeek]


Farhad Manjoo

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

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