By Yi-Wyn Yen
Google's official declaration today that it will submit a solo bid for the upcoming wireless spectrum auction has prompted speculation that the Internet giant is planning to launch its own mobile network. After all, the whole point of bidding on the wireless airwaves is to run a broadband network, right?
Not if you're Google.
Google may play the part of a serious bidder, but the company isn't necessarily looking to become the next national wireless provider, according to analysts and telecom experts. The U.S. consumer mobile market is already saturated, they say, and Google's inexperience combined with the complexity of building and managing a new wireless network makes winning the Federal Communications Commission's Jan. 24 700 MHz auction too costly a proposition.
The consensus on the Street is that Google (GOOG) is unlikely to bid to win. Co-founder Larry Page concurs. "I don't think we feel like there is a desperate need for us to have to bid to win or anything like that," Page told analysts during the company's quarterly earnings call last month. "We have many, many different options available to us as a company in terms of spectrum."
Verizon's announcement this week that it is opening its network also makes it less crucial for Google to win the auction for the so-called C-block spectrum. Verizon will let consumers use any phone on its network as well as allow third-party developers to develop software for those devices. Google has made open standards the centerpiece of its Android initiative.
"Their incentive is arguably less because they've already achieved that victory," says Blair Levin, a telecom analyst with Stifel Nicolaus and former FCC chief of staff. "They can bring an Android device onto the C-block and not deal with operating the network. I can't imagine Google wants to change its business plan to be the last-mile pipe and start selling service subscriptions." More
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