The U.S. Federal Communications Commission will soon vote on a plan to auction
spectrum, with the winner required to offer free wireless Internet services.

The winner of the 25Mhz piece of spectrum in the 2155MHz band would be required
to use a specified amount of the spectrum to deliver free wireless Internet
access. The operator could choose to use any technology, but in that range WiMax
or many of the mobile technologies would make sense.

"We believe this is a good idea and demonstrates the FCC's commitment
to supporting initiatives that have a positive impact on the next phase of broadband
innovation. This will give consumers greater choices to access the Internet,"
said Chelsea Fallon, a FCC spokeswoman, in a statement.

The FCC developed the plan based on proposals from several companies including
M2Z Networks, Commnet Wireless, NextWave Broadband and others. M2Z in 2006 proposed
that the FCC give the company the spectrum so that it could offer free wireless
Internet access to users. The company planned to fund the network through advertising
and said that it would give the FCC 5 percent of its gross revenue. The FCC's
current proposal would simply auction the spectrum to the highest bidder and
require the free services.

The current proposal also includes a requirement for a content filter that
would aim to prevent minors from accessing adult content over the free network.
The final plan could also include specified data rates for the free service.

The FCC first sought comment on the proposal last September. In a joint filing,
TDS Telecommunications and U.S. Cellular expressed concern about how the spectrum
winner would fund the free service. "It will have to be paid for by revenues
from somewhere, presumably other customers not receiving 'free' services,"
they wrote in a comment to the FCC.

While many of the bigger wireless operators filed individual comments, they
typically stressed technical issues that would help ensure that any new service
in the band doesn't interfere with their existing services. However, the CTIA,
a trade group representing the operators, urged the FCC not to place requirements
on the spectrum winner. "The commission should not require licensees to
meet specific conditions, such as pricing plans, minimum data rates or content
filtering," the CTIA wrote in a filing with the commission.

Existing wireless operators typically oppose proposals that would dictate how
they use spectrum. Nonetheless, the FCC recently required the winner of a certain
section of spectrum in the 700MHz band to allow any device to use the network.
Verizon won the spectrum, despite its protests against the requirement.

If the FCC approves the plan for the 2155MHz spectrum during its June 12 meeting,
it would then have to work out the auction procedures, a process that could
take six months or longer.

IDG News Service

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