Google has petitioned the FCC regarding Verizon’s win of the 700 Mhz C block spectrum. Google pushed hard for, and won, an “open” mandate for the winner of the 700 Mhz C block. The mandate basically says that the winner of the spectrum must provide open access and allow devices from any source to access the broadband wireless network utilizing that spectrum. Google sees this open access mandate as a gateway for its upcoming wireless Android platform, which will potentially drive millions of users towards their products and solutions. Google believes those same potential users may not be able to easily reach and use Google’s wireless focused products without that open access provision. The competitive implications are numerous because most wireless Internet access is now controlled by wireless carriers through restrictions and “walled garden” approaches. Opening it up, would allow competitors to build relationships with wireless subscribers and perhaps create the “dumb pipe” scenario for wireless broadband, where wireless carriers simply provide a pipe to the Internet, and don’t create any additional value/revenue for them. It’s the same issue currently being debated by wireline broadband carriers – should I just provide the pipe, or should I try to build more value around that access for which I can create incremental revenue.

Of course we know that Verizon and other communications conglomerates are quite crafty. According to Google, Verizon interprets the open access rules a little differently, and don’t intend on providing open access on its own handsets. Google also contends that the open access provision, while being offered through non-Verizon handsets, will be offered at presumably much higher access costs to the consumer, thus discouraging its use. Google is asking the FCC to deny Verizon’s winning bid for the C-block spectrum, which Verizon won for $4.7 billion, unless they take a more broad approach to the open access mandate. This will be one to watch, because its outcome will have profound implications on the wireless competitive landscape.

Read more insight on this issue at the IP Democracy blog.

The 700 MHz spectrum auction has set a record for bids, and at the end of round 24, had raised a total of $17.5 billion for the U.S. treasury. The previous record was $13.9 billion, set at the AWS auction of 2006. The bidding has slowed somewhat today, compared with yesterday, when over $4 billion was added. At the end of round 24, there were 1067 provisional winning bids among 1060 provisional winning bidders. The auction is expected to continue for several weeks, and will end when there are no more additional bids. Perhaps the biggest news of the auction is that the “open mandate” clause for the C block has been reached, as bids now surpass the $4.6 billion minimum bid required by the FCC to trigger it.

It’s somewhat unchartered territory for the open mandate of the C block spectrum. The concept is that consumers will have the ability to connect any compatible device they choose to the winning bidder’s network. Those devices will be available through consumer electronics channels, and consumers will not have to go through the wireless carrier to obtain them. It's somewhat analagous to how you can connect any laptop or other device you want to W-Fi networks today. It could lead to a variety of new and innovative devices and applications as well as a somewhat different business model for mobile carriers. In addition to pre and post paid subscribers, “nomadic” users for the network will pay by a time period (say a day’s access), or maybe even by the megabyte. Other business models may emerge as well – perhaps free, but ad supported, access will be available. The open mandate was “championed” by Google. The potential for mobile ad placement and search creates a huge opportunity for Google. They will be driving much of the refinement of this new approach to mobile wireless and its impact on the competitive environment.

BlackBerry opened its first retail store, in partnership with Wireless Giant, a Michigan based wireless retailer. The store, located in suburban Detroit, will sell BlackBerry phones, accessories, and wireless subscriptions to all major carriers. It’s a first for BlackBerry, who joins other wireless device makers with retail experiments, including Nokia. Retail of wireless devices, independent of the underlying carrier, also is happening with Apple’s iPhone. These are leading indicators of what will be commonplace in the wireless industry’s future – “carrierless” retail sales of devices

As open networks grow, where customers can bring their own device, expect to see an explosion in wireless device availability, including stand alone branded stores. Wireless devices will soon be available for purchase in much the same way we buy other consumer electronic devices today, including PCs and televisions. It remains to be seen how this shift in buying behavior will affect wireless carrier business models and their competitive positioning. Devices are heavily subsidized today, but in an open world, subsidies will surely decline. Apple proved that consumers will pay full price for the right wireless device.

Verizon Wireless announced today that they will be “opening up” their network to wireless devices, software, and applications not offered by the company. According to a company press release, “In early 2008, the company will publish the technical standards the development community will need to design products to interface with the Verizon Wireless network. Any device that meets the minimum technical standard will be activated on the network.” I’m sure many people will yawn at this development and think it doesn’t go far enough, but we should all recognize that it’s a pretty bold step for a traditional carrier like Verizon Wireless, who is notorious for wanting to control and limit network access. Is this a calculated move to address Google’s Android project?

You have to assume that Android played a role in this. This move by Verizon may not be totally a result of Android, but I’m sure it helped move it along internally. Verizon joins Sprint who made a similar pledge for their upcoming WiMAX network (assuming it gets built). Of course Google is leading the charge here and put their money where their mouth is by leading the Android movement. There is also speculative consensus that Google intends to be a major player in auction 73 for highly valuable 700 Mhz spectrum. If that is indeed true, Google may be setting itself up to create a compelling competitive ecosystem for established wireless players. It seems as if Verizon recognizes this possibility and hence is now a champion of open access. The promise of open access, where consumers can utilize devices on a wireless network that are sold independently of that wireless carrier, may further stimulate the already quite competitive wireless landscape. It may also fuel a new wave of innovation, including devices and applications well beyond traditional cellular phones, that may positively contribute to the bottom lines of all involved. With Verizon's announcement, they join Sprint and T-Mobile as publicly embracing some sort of open network initiative. Missing of course is AT&T - the current king of closed networks thanks to the iPhone. How long will they be able to maintain their closed access "lone ranger" status?