Google Telecom - It's Just a Matter of When

Later today, Google will likely announce its intention to bid on the US 700Mhz wireless spectrum auction which is set to begin on January 29th. If successful, Google's acquisition of this portion of the spectrum would allow them to enter the US wireless market with an innovative and disruptive business model.

The ability for the incumbents to truly innovate, is in many cases, hindered by legacy business models and investments, and current revenue streams. There is a natural resistance to offering services that would cannibalize existing revenue sources.

Google will have the freedom to offer completely new service offerings free of any internal business-model conflicts. For example, Google could offer very low cost, and perhaps ultimately free wireless service, by shifting the source of revenue from subscription and air time, to ad based services; you get the service for free in return for viewing ads. Additionaly, Google's propensity for open systems is well known. By the way, it will be interesting to see if the openness philosophy perseveres when Google itself begins to feel threatened by future competitors.

Also, the portion of the spectrum up for auction has different propagation charateristics than the frequencies currently used my the mobile operators. 700 Mhz  is better able to penetrate the walls of buildings which could make  devices operating  at that frequency more attractive to consumers.

There's a lot happening in the  North American wireless industry. I'm convinced that theses changes will lead to lower prices, wider adoption and new applications.

Rick McCharles
Telecom Consultant, Toronto
RIC Services




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