First, though, the FCC must write the rules dictating how that spectrum will be used by the auction winner. That means (as things historically go at the Commission) mediating between several powerhouse companies like Verizon, AT&T, and Google who really want to get their paws on this money-making resource. If they're lucky, a little start-up or even consumers will have a voice in the rulemaking.
Wait a minute. Google? Aren't they an Internet search company? Since when do they want to be a wireless company like Verizon and AT&T?
Well, Google is really messing up the plans the good old boys had for winning this auction and keeping the spectrum all for themselves with very few restrictions on who they can restrict from using it in a restrictive manner. And, gosh darnit, Google has so much money and such a brand name and so much money and so many new lobbyists and so much money that they might screw around with the way things are supposed to work.
Google wants the FCC to make at least part of the spectrum available to anyone who wants to use it -- "open access". It's sort of the net neutrality fight for wireless.
The Commission, which oversees the nation's telecom, broadcast, cable, and satellite industries, decides who gets to use our publicly-owned airwaves and for what. So, they tell the radio and TV stations what channels to use, the military and police what frequencies are theirs, and the wireless phone companies where to provide their services. Now that broadcast TV stations have migrated to high definition frequencies, their old analog channels are available for other uses.
What does Google want to do? For starters, they want to offer $4.6 billion as an opening bid. Then, they want the FCC to require that the auction winner:
1. allow any wireless handset, not just the ones the wireless carrier allows you to buy, to work on the new spectrum; and
2. make capacity available on a wholesale basis to allow third-parties and other carriers to use it.
On Tuesday before Congress, the Commission's chairman, Kevin Martin, said that he's OK with Google's #1 but not with #2.
Of course, Google complains that if they can't get everything they want, they're taking their $4.6 billion (give or take a couple of million) and going home. Is this a Google negotiating bluff or a promise?
Chairman Martin said, "Google is upset about the lack of inclusion of a wholesale requirement," just as others were upset about the open device rule.
The FCC should decide on final rules for the use of this spectrum in the next week or two, so stay tuned.
By the way, where's Apple and Steve Jobs' I-Phone in all this?