Sunday, October 7, 2007

700 MHz spectrum

With the auction of 700 MHz spectrum less than three months away, the competition is expected to be fierce than ever. The auction will start on January 24, 2008 and the money collected should reach to U.S. Treasury no later than end of June, 2008. The spectrum was previously used by Broadband Analog TV Broadcasters, but now the ownership will be transferred to government by end of 2009.

In a recent interview published on the CTIA Wireless Association website, CTIA's Vice President of Regulatory Affairs Christopher Guttman-McCabe strongly emphasized the importance of additional spectrum to meet the growing demand of wireless communication. Mr. Christopher said that the money collected from this auction, which should be no less than $12 Billion, will be significantly used to reduce the deficit and massive critical upgrade of public safety communications. This money will also be used to generate coupons for users of analog TV for analog to digital transition.

The 700 MHz spectrum has strong broadcast-attractive features, such as the ability to penetrate the walls and to cover a much larger area per dollar invested than other spectrum with higher frequencies. In addition to these benefits, the telecom industry has registered a consistent growth in number of subscribers and total revenue in the last couple of years and needs to address the growing demand. Just for the records, last year, US Wireless Industry (wireless handsets and services) generated $118 billion revenue, which expected to grow to $450 billion in the next 10 years.

Verizon, a strong contender for this spectrum has recently been accused by Google for behind the scene lobbying to change the open access rules, proposed by FCC. Open Access Rules will allow wireless customers to buy handsets or download software different from what's being offered by their specific carrier. Google, which plans to foot its steps in the telecommunication market with this bid, is supportive of open access rules.