July 31, 2007 4:00 AM PDT
Google bets on mobile market
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The 700MHz spectrum, which has been used to provide analog TV service, is considered the last piece of prime real estate left among wireless airwaves because it's able to travel long distances and penetrate walls. Everyone from mobile operators to public-safety companies to Google sees the spectrum as a perfect opportunity to extend mobile broadband services.
"Google is willing to do anything necessary to introduce some competition into this space and to really drive the prices of service to where they are most affordable to the broadest number of people," Sacca said in a recent interview. "That entails everything from building and operating a network, if necessary, to partnering with the vast number of companies left out of this game--for whom $5 billion is an insurmountable hurdle to participate meaningfully in an auction that could introduce true competition--to any of the existing carriers, if they want to put users first in their business models and prioritize those customer experiences."
The company is pushing the FCC to adopt rules in the upcoming 700MHz auction that would ensure winners of certain spectrum licenses would have to adhere to four openness principles. These include guaranteeing that consumers can use any device or software on the network, as well as forcing winning bidders to offer spectrum at reasonable wholesale prices to ensure that small companies can get access to wireless capacity to build competitive wireless services.
AT&T and Verizon Wireless, the two largest wireless operators in the United States, say they would accept an open-access rule for devices, but they are against any rules guaranteeing open access for companies seeking to buy wholesale capacity.
The FCC is expected to vote on these rules on Tuesday.
Greg Sterling, a principal of Sterling Market Intelligence, said he doesn't know what the wireless spectrum bid means for Google's products, but "the fact that they're doing all these simultaneous things reflects their perception that mobile is a strategic area that they have to aggressively pursue."
He said Google's executives have strongly implied to him that the company is not planning to become an Internet service provider or a mobile virtual network operator. "They want to talk to partners and potential partners," not compete with them.
The ultimate goal for Google, he said, seems to be in improving the user experience. He pointed to "Goog 411," a voice-activated search tool for mobile devices.
"They're trying to improve usability so they can drive adoption," he said.
Some bloggers have speculated that Google is so interested in improving the user experience that it might go ahead and develop its own handset. Google hasn't said whether it would get into the handset market, but Sacca made it clear in a recent interview that Google feels there is plenty of competition in the device market.
"I think there is a healthy environment of competition and innovation in the device market worldwide," he said. "It's just the channel that discourages that kind of innovation here in the U.S. For example, you see the Nokia E61, which is a combined Wi-Fi and 3G device, that when it came to the U.S. suddenly became the E62, and the Wi-Fi was missing. We have seen examples where some devices have the ability to send photos back to a computer via Bluetooth, but carriers have restricted that transfer to make sure that the photo traffic has to go over their network."
Analysts say it's more likely that Google would continue to strike deals with phone makers. The company already has announced partnerships with Samsung, LG Electronics, Palm and Motorola. And some of its applications come embedded on some Blackberries and Windows Mobile devices.
Search Engine Land's Sullivan said he doesn't think the reports of Google building its own phone are realistic.
"Google has no experience with phone stuff," he said. "They've got partnerships with a lot of carriers, and if they roll out their own phone they threaten those partnerships. They could try to do their own wireless device down the line, but on a different frequency. So it would be not so much a phone as a mini-computer. Then you could use Google Talk to make calls."
See more CNET content tagged:
Chris Sacca, Google Inc., Sprint Nextel, bandwidth, cell phone
12 comments
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I do not know the full technicalities of the deal, but yet fail to understand how, going for only the datanetworks part Google is planning to leverage cell phone market.
And I guess sprint has got out of dropped call problem by now... :)
atul kumthekar
see what basveo can do for you google.
with the global cell phone industry. They have left the the US
woefully behind in mobile technology.
I have had Sprint for years, do a lot of traveling, and have no problems with the service.
I think this is a great move for google.
These old school gus are on the way out. The GOP needs to be re-worked to serve the people's interest not just the rich and big money.
Also, it is so ironic that the party that screams the most against big government (GOP). Is in reality all about the BIGGEST government. And it does not function worth a ****.
And let us not for get the "Moral Majority" LOL. Yeah the GOP has the most moral polititians. What a freakin' joke. This GOP party (and many of its hig-profile supporters) is the party of hypocrits and perverts.
These nuts are also spending our nations future on foreign nation building, financing war, demanding and pledging MORE defence spending. America supports 700+ military bases. Not only that but the US also out spends the other world military powers (all lumped together) by many times. JUST LOOK AT ALL THAT MONEY THAT COULD BE USED IN OUR OWN COUNTRY!
Why are my fellow Americans the most terrified country/people in the world? We does our country NEED to dominate every single world crisis.
Things are very currently going wrong in America.
One more thing to the GOP. Since it is obvious that you are all on drugs (and perverted acts). Listen to the words of Nancy Reagan and learn to "Just say no."
SORRY! I do not know how my political post ended up here.
Google is essentially a media company generating revenue from advertisements. They provide content and applications for the benefit of mankind and make huge profits in return.
Google sees cell phones as a great place to imbed its applications but the largest players in the field aren?t playing ball. What is Google to do?
Up until recently there wasn?t much Google could do, a handful of cell phone companies own the airwaves and act like little dictators. But now that the 700 MHz spectrum is opening up Google has a chance at something??try to open up the playing field as much as possible so that they can implant their software on more cell phones.
To this effect Google is winning the battle and will probably win the war. Already the FCC has mandated that 22MHz must remain open to any and all cell phones or applications. Without spending a dime Google applications are now on 1/3 of the spectrum!
The FCC has also predicted that the auction will generate about $15 billion. Google has declared that it is prepared to bid about $4.6 billion or 1/3 of the estimated total. Since Google has already locked in 1/3 of the spectrum to its applications it can dedicate the billions of dollars to the remaining spectrum and purchase an additional 22MHz bringing the total spectrum that will support Google applications to 2/3 of the total 66MHZ.
Once Google owns the 22MHz, they can lease it out to smaller companies with the condition that access is kept open for Google applications and bandwidth for all those lucrative advertisement dollars.
With two thirds of the coveted 700MHz open, I doubt that even the big players will be able to resist the competitive pressures and will have to open up their networks. At this point, Google is declared victor and the consumer is saved from the "freedom hating" cell phone oligopoly dictators!
If Google gets 1/3 of airwaves, and 1/3 of the remaining 2/3 must be open, 5/9 of the airwaves must be open to Google applications/services.
However, Google's strategic alliances may allow Google applications/services to run over more than 1/3 of the 2/3 of the airwaves Google does not own. Perhaps 1/3 of the 2/3 will immediately and voluntarily allow Google applications to run. So Google might run on 1/3 + (1/3)*(2/3) + (1/3)*(2/3)*(2/3) = 3/9 + 2/9 + 4/27 = 19/27 of the wireless airwaves - more than 2/3.
Or are my assumptions incorrect?