Googlecomm? GoogleTel? Google Telephone & Telegraph? GT&T?
by John Paczkowski
Posted on November 16, 2007 at 5:59 AM PT
Google should put up or shut up–they can bid and enter the wireless market with any business model they prefer, then let consumers decide which model they like best.”
–Jim Cicconi, AT&T Senior Executive Vice President, External and Legislative Affairs, July 20
Bad news for AT&T and any other incumbent telecom planning to participate in the 700 MHz spectrum auction in January, because it’s looking more and more like Google would rather “put up” than “shut up.” The company is preparing a bid of $4.6 billion for the open-access “C block” of the spectrum–and what’s more, it apparently intends to make the bid with its own cash and possibly some borrowed money.
With the help of “game-theory specialists,” the company is plotting its auction strategy, and at its headquarters in Mountain View, Calif., engineers are testing an advanced wireless network that might be used if it wins the spectrum auction. It would seem, then, that Google has virtually committed itself to bidding in the auction, though a Google spokesman said the company won’t reveal its plans until the Dec. 3 Federal Communications Commission deadline for declaring an intent to bid. “In the meantime, we are making all the necessary preparations to become an applicant to bid,” the spokesman said. “Our goal is to make sure that American consumers have more choices in an open and competitive wireless world.”
An admirable goal, indeed. And one that extends well beyond Google’s core competencies. But as the company’s founders said in their 2004 “Owners Manual For Google Shareholders,” Google will not hesitate to place major bets on promising new opportunities:
We will not shy away from high-risk, high-reward projects because of short-term earnings pressure. Some of our past bets have gone extraordinarily well, and others have not. Because we recognize the pursuit of such projects as the key to our long-term success, we will continue to seek them out. For example, we would fund projects that have a 10% chance of earning a billion dollars over the long term. Do not be surprised if we place smaller bets in areas that seem very speculative or even strange. As the ratio of reward to risk increases, we will accept projects further outside our normal areas, especially when the initial investment is small.”
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