Spectrum Wars

Spectrum Wars
The battle between AT&T, Google & the U.S. Government over wireless networks - and why the only losers are the American people
Justin Hartfield

A letter from Google CEO Eric Schmidt has promised the US government "at least $4.6 billion" as long as the US government agrees to Google's terms. Yes, a private company is dictating its terms to Uncle Sam. Is the FCC a bizarre bunch or what? In yet another uninspired move, AT&T issued apublic statement to address the issue:

"Google has now delivered an all or nothing ultimatum to the U.S. Government, insisting that every single one of their conditions 'must' be met or they will not participate in the spectrum auction. Google is demanding the Government stack the deck in its favor, limit competing bids, and effectively force wireless carriers to alter their business models to Google’s liking."

Despite the fact that AT&T seems to be run by profit-hungry executives who are possibly one or two pegs higher than a tobacco industry lobbyist, they have a point. Why should a private enterprise be able to make demands on the US government? That doesn't seem right. Did you walk your dog this morning or did the dog walk you? In the eyes of AT&T, Google shouldn't be allowed to make conditional bids- they have natural incentive to exclude their competition (and would be ecstatic to park Google Adwords all over the frequency with the exclusion of others).

But, I'm afraid this is a classic case of the pot and the kettle. See, AT&T and cronies want to destroy the newly available network for the consumer just like they did with our current wireless cellphone carrier plans. They pool their resources to buy out and shut down any competition, all the while conspiring together to keep the prices above a certain agreed upon fixed point. The result is little market incentive for these companies to improve their products- this ultimately hurts the consumers. Which is why they see Google as a HUGE threat to their preexisting profit model.

Google on the other hand wants to open up the market, and the conditions of their bid all surround guaranteeing a level of "open" platforms which could be accessed by third-party developers and consumers alike. To many, this is a cause for minor celebration and several prominent members in the industry are considering Google a white knight in this regard. However, Google's bid is expected to be substantially lower than what AT&T and friends will be able to offer up. And as we know from history, the government almost always sides in the favor of more money (which leads to mo' problems, right Ma$e?).

But the point isn't whether the consumer or Corporation wins in this one meaningless battle of agendas. The point is that the government shouldn't even be in this mess in the first place. The only obstacle stopping private corporations from giving US citizens the highest quality and most reliable wireless networks is, ironically, the US government. If the feds only knew how to just get out of the way of business, life would be a much better place, and with less paperwork to boot. In fact, it would be filled with no dropped calls and the ability to upload the new Shins album to your friend's tiny 3 square inch phone at broadband speeds. So FCC, will you let us illegally transfer proprietary ringtones to our friends' cellphones in broadband speed if we promise to download the edited versions?

The above work is the opinion of the author, and not necessarily that of The Prometheus Institute.