November 16th, 2007
Google to bid alone on 700MHz spectrum
Google will be there in January, when the FCC opens up the big auction for 700MHz spectrum. No surprise there, but press reports are now saying that Google isn’t interested in any partners for its bid on the valuable spectrum. Many people had assumed Google would partner with a company in the wireless network business.
So how will it do it? Business Week offers some perspectives. Google only has about $5 billion in cash and the auction might run as high as $14 billion. So presumably it will have to finance the rest of the bid.
Financing aside, a wireless newcomer like Google would face a big challenge designing, building, and then operating a mobile network—from towers to huge computer-filled operating centers. It would also have to develop the product lineup and business systems needed to provide mobile services across the country. Many experts contend these constitute too heavy a load for Google alone.
Another option is that Google could own alone but partner to build. Interesting partners there could be Sprint, which is committed to spending $5 billion on a WiMax-based network. Not only that but Sprint has said the network will be completely open, which would be music to Google’s ears.
And of course Intel, a prime backer of WiMax, could do some interesting things in connection with Google. One analyst even suggests Verizon could partner with Google if the search company won the auction. That will be surprising since the two will be fierce competitors to win the spectrum.
“But there’s probably more to be gained together,” said Mark Gibson, senior director at spectrum consultancy Comsearch.
