Verizon Wireless, one of the biggest foes to the open access regulations for the 700 MHz auction, did an about-face this week. It announced plans to open its network to allow subscribers to connect any device and use any application as long as it meets some "minimal technical requirements." (See story No. 1) Naturally, skepticism is running rampant. Most pundits will believe it when they see it, especially when Verizon has been the most strict about what applications run on the network, citing security issues.
But Verizon, which says it has been looking at open access for some time, had its back against the wall as the deadline for intended 700 MHz bidders rolls around on Monday. Google, with its hefty market capitalization, has threatened to participate so it can foster this open-access model. I have detailed in the past why Google should stay out of the auction, primarily because it deviates so far from its core competency. In light of the risk involved in building a network and selling capacity at wholesale, Verizon's move should now throw a wrench in Google's bidding plans, especially if one takes the view that Verizon's move will create a domino effect in the industry.Â
However, there have to be some questions in the minds of Google executives, especially surrounding theÂ "minimal technical requirements" clause when it comes to any device and application running on the network. Certainly, whether or not these technical specifications are easy for developers to use has bearing on whether or not third parties can create innovative and compelling applications. Sprint Nextel, which is rolling out WiMAX based on an open access model, also plans to require some minimal technical requirements whereby a device has some sort of sticker that indicates it is Sprint certified. So it's not a new concept.
In short, Google will likely still bid, but Verizon's move has to change its views about winning at a high cost. --Lynnette