Google's FCC deadline approaches: Will it bid for 700 Mhz wireless spectrum?

Google's filing deadline with the Federal Communications Commission's auction of 700 megahertz wireless spectrum is rapidly approaching, but we won't know the search giant's real intentions until 2008.

The FCC's filing deadline is Dec. 3 for the upcoming 700 Mhz spectrum auction. This auction is a big deal for many parties including Verizon Wireless and AT&T, which want to broaden their services. Google is looking to elbow its way into the wireless market--or at least pry open business practices so its software and ads can run free.

For observers, this deadline for Google will be frustrating. Google won't verify whether it plans to bid or not once the big day comes. Bidders' identities won't be revealed until 10 days before the start of the Jan. 24 auction.

UBS analyst Benjamin Schachter notes:

The filing deadline for the upcoming spectrum auction is Dec 3rd and we expect Google to submit its application by then. Importantly, under the auction rules, Google will not be able to comment or even confirm if it has applied. Bidders' identities won't be disclosed until 10 days before the Jan 24 start of the auction.

That mum is the word mandate can be found in the FCC's document (PDF) outlining the auction rules. According to the FCC, "bidders should use caution in their dealings with other parties, such as members of the press, financial analysts, or others who might become a conduit for the communication of prohibited bidding information."

Simply put, Google's intentions won't be revealed until Jan. 14. The consensus seems to be that Google will put in a bid, but will aim low with a minimum bid of $4.6 billion. Why? Google has largely accomplished its goals. It prodded the FCC to mandate open networks, upped the price for Verizon and AT&T and even pried open a few business models. Verizon Wireless' announcement on Tuesday that it would open its network is partially due to Google's lobbying with the FCC.

Schachter's take:

After maneuvering to push the adoption of numerous ‘openness’ provisions backed by the threat/promise of a Google spectrum bid, we believe Google needs to bid in the auction to save face, but will only bid the minimum reserve price ($4.6b). Google remains a believer in the mobile opportunity, but would prefer to partner as an ad monetization/software platform rather than operate a network. Furthermore, we believe Verizon's announcement in support of open access standards further reduces Google's motivation to build a wireless network.

I agree with that prediction, but wouldn't completely rule out Google building a wireless network. If Google is going to find renewable energy sources on the cheap why wouldn't it build a wireless network too? The latter has to be a lot easier.