It's Official: Google Plans 700 MHz Bid

Google Communications wireless megahertz

The 700 MHz spectrum FCC auction begins Jan. 24, 2008, and will free up airwaves for more efficient wireless Internet service, according to Google.

The announcement was not a surprise, but it formalizes what Google has been working on behind the scenes.

"We believe it's important to put our money where our principles are," said Eric Schmidt, chairman and CEO of Google, in a statement. "Consumers deserve more competition and innovation than they have in today's wireless world. No matter which bidder ultimately prevails, the real winners of this auction are American consumers who likely will see more choices than ever before in how they access the Internet."

Earlier this year, Google reportedly asked the FCC for changes in the auction format, which some observers believe would have benefited Google.

Earlier this month, Google executives discussed the auction with Federal Communications Commission officials, including FCC Chairman Kevin Martin, according to a Reuters report. The FCC did not change the auction process, but with Google's backing, the FCC said a large portion of the spectrum will have to be open to networks to allow consumers to use any device on those frequencies. But the FCC did not require open access to be resold on a wholesale basis.

"We see the upcoming 700 megahertz spectrum auction at the [FCC] as one of the best opportunities consumers will have to enjoy more choices in the world of wireless devices. That's why we announced today that we are applying to participate in the auction," wrote Chris Sacca, head of special initiatives at Google, on the company's corporate blog Friday.

Google is ready to bid at least the reserve price of $4.6 billion for the so-called "C Block" of spectrum, according to the company. "We already know that regardless of which bidders ultimately win the auction, consumers will be the real winners either way. This is because the eventual winner of a key portion of this spectrum will be required to give its customers the right to download any application they want on their mobile device, and the right to use any device they want on the network," wrote Sacca. "That's meaningful progress in our ongoing efforts to help transform the relatively closed wireless world to be more like the open realm of the Internet."

Google's formal application to participate in the 700 MHz auction will be filed with the FCC on Dec. 3, according to the company, and its application doesn't include any partners.

By mid-December, the FCC will release a public list of eligible bidders. Each bidder must make a deposit no later than Dec. 28, depending on the licenses they bid on. The more spectrum blocks an applicant bids on, the greater the deposit, Sacca wrote.

The auction begins Jan. 24, with bidding done electronically and anonymously. The auction will end when there are no new bids and all the spectrum blocks have been sold, which could be in March 2008, according to Sacca. If the reserve price of any spectrum block is not met, it will be re-auctioned.

After the auction is completed, the FCC will announce the winning bidders and require final payments on the licenses, Sacca wrote.