The two top cell phone providers in the United States, Verizon Communications and AT&T may have won the  battle by acquiring the two most sought after portions of wireless spectrum during the Federal Communications Commission auction that ended Tuesday with $19.12 billion in total bids, however Internet search leader Google may have won the war, having pushed bidding high enough to ensure more open access to any service Verizon provides using the airwaves it won. Together the two large cell phone companies accounted for 80 percent of the money taken in by the auction, winning more than $16 billion in radio spectrum licenses, according to results released Thursday. Google Predicts New Mobile Freedom "Consumers soon should begin enjoying new, Internet-like freedom to get the most out of their mobile phones and other wireless devices," Google lawyers Joseph Faber and Richard Whitt said in a statement referring to the portion of the airwave spectrum around 700-megahertz previously used for broadcasting analog television signals, which is well suited for providing wireless service because of its ability to travel long distances and to easily penetrate walls. The spectrum won in Tuesday's auction is expected to allow consumers access to faster and more powerful wireless services. Both San Antonio, Texas-based AT&T, the top mobile provider in the U.S., and New York-based Verizon Wireless, which bid in a joint venture with Vodafone Plc, are expected to use their portions of the wireless spectrum won Tuesday to improve existing mobile service and to serve as the digital foundation for a new generation of wireless services. The Close of 260 Rounds of Secret Bidding After nearly two months of secret bidding encompassing 260 rounds, Verizon agreed to purchase a total of $9.63 billion for 108 licenses in the auction, while AT&T agreed to  purchase a combined $6.64 billion for 227 licenses, according to FCC results. The FCC auction, which is expected to dole out the airwaves to the winning companies next year, will result in the money from the winning bids being added to the U.S. Treasury. In a statement issued Thursday, Verizon, the second largest mobile provider in the U.S., said the auction results would help the firm expand its services. "We are very pleased with our auction results," Verizon said. "Specifically, we were successful in achieving the spectrum depth we need to continue to grow our business and data revenues, to preserve our reputation as the nation’s most reliable wireless network, and to continue to lead in data services and help us satisfy the next wave of services and consumer electronics devices," Verizon noted in the statement. Verizon also said its winning bids included "a nationwide spectrum footprint covering 298 million Pops [points of presence], plus 102 licenses for individual markets covering 171 million Pops." Google's Open Access Provisions a Victory of Sorts Verizon Wireless bid $4.74 billion for the largest nationwide band of spectrum in the auction, winning out over Mountain View, California-based search giant Google, which stopped its bidding at $4.71 billion. In November 2007 Google said that it was prepared to bid at least $4.6 billion in the FCC auction, a figure representing the auction's reserve price, which Google agreed to meet if the FCC implemented four "open access" provisions. Two of the provisions Google pushed for, allowing customers to use any device or software on the new spectrum, were implemented, while two others which dealt with allowing the eventual winner to provide access to rivals on a wholesale basis, were not included. Verizon Wireless, which also agreed to purchase 25 regional licenses in the auction, cannot announce its exact plans for the spectrum it won until a quiet period imposed by the FCC as an anti-collusion measure expires after an April 3 deadline. Companies must make a down payment on their winning bids by that date. Those who had hoped the auction, which began on January 24, would bring new entries into the U.S. wireless market and possibly bring lower prices to consumers, were likely disappointed with results that saw the top two players adding considerably to their vast networks, although one portion of the airwaves, won by Frontier Wireless for $711 million, may foster a new nationwide video network. Frontier Wireless has a partnership with satellite television service Dish Network Corp. Some had hoped that Google would win a portion of the spectrum up for auction. New Generation of Wireless Services May Emerge AT&T could use the licenses it won Tuesday to create a wireless service that would also use another large  portion of the 700-megahertz spectrum it added earlier this year when it acquired Rhode Island-based Aloha Partners for $2.5 billion. AT&T wireless division president Ralph de la Vega said Thursday in a statement that the auction win will help broaden AT&T's wireless services. "AT&T's strong spectrum holdings position the company to further enhance the quality and reliability of existing wireless broadband and voice services, and to set the foundation for new-generation wireless broadband technologies and services," de la Vega said. The auction was seen as a "significant success" by FCC chairman Kevin Martin, despite one unsold range of spectrum that did not have a bid for its minimum $1.3 billion, which the FCC could return to a future auction with a lower minimum bid. The unsold area of spectrum in the so-called D-block, received only one bid, of $472 million. By winning what is considered the most prized portion of spectrum licenses, Verizon took a sizable step in its efforts to gain ground on leading wireless rival AT&T. On Wednesday, before the results of the auction were made public, Verizon announced that it would later this year allow more open access to its networks for consumers using mobile devices it does not sell, a move credited by some industry analysts as having happened due to Google's successful lobbying to make the winner of the auction more open to third-party devices. Google stands to benefit by having more consumers using mobile devices running the Android operating system, which is a Google-supported project, able to connect to networks such as Verizon's. Although the spectrum won by AT&T was not bound by the same Google-initiated openness requirements, it has said that it too will allow the use of third-party cell phones on its networks. Losing FCC Auction Battle to Verizon and AT&T, Google May Win War One member of the online discussion forums operated by WebmasterWorld, a community of webmasters and  search engine marketing (SEM) professionals founded by chief executive Brett Tabke, reacted positively to Verizon's success in the FCC auction. "They are getting out of the device business and showing little real interest in the content business, while going after more capacity to serve the consumer," wrote a WebmasterWorld member using the handle "weeks." The WebmasterWorld member concluded that, "This is a good thing for the Internet and those who call themselves webmasters." Dish Network, formerly known as EchoStar Communications, agreed to purchase 168 wireless licenses for a total of $711 million. Wireless handset television firm MediaFlo and its parent company Qualcomm agreed to purchase $558 million worth of spectrum licenses in the auction. Cox Wireless Inc., which owns cable company Cox Communications Inc., agreed to buy 22 licenses for $305 million, while former Microsoft executive Paul Allen's Vulcan investment company agreed to pay $112 million for two licenses in the so-called A block. Related Links:
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9:15 pm on Mar. 21, 2008 (utc 0)
