News today : Google on track to buy wireless spectrum and set up a mobile network

Google "is gearing up to make a serious run at buying wireless spectrum, a chunk of the airwaves that can be used to provide mobile phone and Internet services, in a Federal Communications Commission auction in January. Google is prepared to bid on its own without any partners, say people familiar with the matter. It is working out a plan to finance its bid, which could run $4.6 billion or higher, that would rely on its own cash and possibly some borrowed money," reports The Wall Street Journal.

Sure, Google doesn't know much about the wireless business, but it has
motivations. The story says:



Google also views open wireless networks as key to sidestep any telephone and cable company efforts to make it difficult for consumers to access Google services, or to charge Google to deliver the services to consumers over their Internet connections. Carriers such as Verizon Wireless, a joint enture of Verizon Communications Inc. and Vodafone Group PLC, say they guard their networks closely to provide high-quality phone and Internet service and protect consumers from security breaches and invasions of privacy.

Behind the scenes, Google also is eyeing financial opportunities, as revenue for U.S. wireless carriers hit $95 billion last year, the research firm Yankee Group estimates. Google could reap subscriber fees if it controlled an operator, and experiment with models such as a one-time licensing fee for consumers to use its network and no monthly access charges. Company executives have said that cellular handsets or services could eventually be subsidized by revenue from advertising consumers view on their cellphones.


With companies as big and powerful as Google, there is sometimes a tendency for the speculation to run ahead of the reality. It's as well to remember, for example, that the US market is not currently dominated by Google-branded Gphones or free coast-to-coast Google-operated Wi-Fi, and that not everyone has a Google-branded PC running Google-branded Linux attached to a global Google Operating System.

However, if the company really is going to punt at least $5 billion into the US mobile market, it must have some serious plans.

News From : blogs.guardian.co.uk

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