Google's vision of tomorrow's wireless network is in stark contrast to how wireless operators do business today, setting the two sides on a possible collision course.
Earlier this week, the search giant filed a patent application with the U.S. Patent Office describing its vision of an open wireless network where smartphones aren't tied to any single cell phone network. In Google's open wireless world, phones and other wireless devices would search for the strongest, fastest connection at the most competitive price. Essentially, wireless operators' networks would be reduced to "dumb pipes."
The idea is that depending on where a wireless user is at any given time, he could be on any number of networks. For example, if coverage is better from Verizon Wireless at home, a subscriber might connect to that network to make phone calls. But he might use AT&T while at work, where the signal is stronger. Price would also be a factor, and operators would constantly be vying in a sort of auction to provide the most competitive pricing for the call.
Meanwhile, users could also access other free or low-cost networks. So if, for example, someone wanted to surf the Web from their phone they could connect via a Wi-Fi or WiMax network. Or people may even be able to connect to a network that uses yet-to-be available "white space" spectrum.
This notion of a device connecting to any network is quite different from how the wireless industry operates today. When people buy cell phones today, they're essentially locked to one provider. A particular provider may have roaming agreements with other cell phone operators, but customers have a contract and billing relationship with one cell phone operator. And if they decide to switch carriers, they usually have to pay a penalty for breaking a contract, and they must purchase a phone that will work on the new network.
Of course, consumers don't have the same issues in the broadband market, where people can connect to any broadband network using any computer, whether it be a Wi-Fi, cable or DSL connection.
Carriers are beginning to offer consumers some alternatives. Apple's iPhone, which is sold exclusively in the U.S. on AT&T's network, also has Wi-Fi. And users regularly choose to surf the Net on Wi-Fi connections. T-Mobile has a service that allows subscribers with Wi-Fi enabled phones to switch between the T-Mobile cellular network and a home Wi-Fi connection.
Verizon Wireless also recently announced it would not require contracts in exchange for consumers paying full retail price for devices. And all four of the major mobile carriers in the U.S. have begun pro-rating contracts so that the penalty for leaving a service before the contract expires decreases over time.
Playing by the rules
But wireless operators have stopped short of offering truly open networks that would allow consumers to bring any device onto their networks. For instance, Verizon Wireless' Open Network Initiative announced last year isn't really open. The company isn't allowing any device to connect to its network. It's simply speeding up the certification process.
Executives at these companies argue that they need to certify devices to ensure service quality. Recently, T-Mobile CEO Robert Dotson told an audience at the CTIA tradeshow in San Francisco that "even though on the outside (an open device network) looks enticing, there still needs to be a minimum level of control to safeguard security and privacy."
For the meantime, it looks like Google is being forced to play by these carrier rules. Earlier this week, T-Mobile USA launched the G1, the first smartphone to use Google's Android operating system. The phone is set to go on sale in October, but it will be locked to T-Mobile's network.
That said, Google has high hopes for changing the market, whether carriers like it or not. It has been lobbying the Federal Communications Commission and Congress for well over a year to adopt policies that reflect its vision of an open network. Last year it convinced the FCC to agree to add an open network provision in the rules for the 700MHz spectrum auction. And then it helped ensure the provision would take effect by bidding on the spectrum so that it reached a predetermined threshold. It's also been pushing the FCC to open up the so-called white spaces between TV channels for unlicensed use.
Google has also been investing in alternative wireless technology and networks. It's investing $500 million in the new Sprint/ClearwireWiMax joint venture, which is trying to build a nationwide network using WiMax. The company has dabbled in citywide Wi-Fi. It's already attempted to buy wireless spectrum. And it's been investing in its own fiber infrastructure as well in the form of undersea cable deployments, which could eventually be used to create high-speed backhaul networks.
Still, there are several challenges to making Google's open network a reality. For one, device manufacturers would have to cram in more radios into devices to handle all the potential wireless networks that consumers might encounter. While this is not impossible, it does complicate device design and could drive costs up and battery life down. Also, designing devices to seamlessly switch among all those networks is not a trivial task. In fact, users have complained about the iPhone 3G's ability to switch between 2.5G and 3G networks.
What's more, a real-time wireless auction system would have to be in place to manage network usage in Google's ideal wireless world. This actually could be an opportunity for Google, according to a blog on Wired News. The patent explicitly outlines "a transparent auction marketplace with wireless providers bidding in real time to provide the communication services to users." And the blog notes that Google may be well-suited to establish such a marketplace because of its experience with AdWords and AdSense.
One thing is certain, Google has a long way to go before its vision is realized. But as wireless networks handle more data and become more Internet-enabled, it's only a matter of time before openness is forced onto carriers whether they like it or not.