Will FCC Kill Free Wireless Broadband Plan?
August 15, 2007 |
In today's news, the chief excecutive of the Federal Communications Commission announced that his group is opposed to a plan by a Silicon Valley entrepreneur to offer free wireless broadband Internet service nationwide, according to the Wall Street Journal.
The broadband plan was devised by a Menlo Park-based company, known as M2Z Networks, which happens to be run by the FCC's former head of the wireless bureau, John Muleta. M2Z wants to take 25 megahertz of currently unused space on the spectrum and use it to provide a wireless broadband Internet network. M2Z's outline included providing 5% of its revenue to the U.S. Treasury and offering free access to public safety departments.
According to the company, the service would be free to 95% of Americans within 10 years. Advertising would be the main source of revenue and there would also be an option to get faster speeds by upgrading for $20-30 per month. This plan has already received media attention and praise in Jackson, Mississippi, it's potential launch city, and it has already been backed by both venture capitalists and lawmakers.
M2Z stated on Wednesday that it would ask that the DC Circuit court order the FCC to conduct a thorough analysis of M2Z's proposal before coming to a final decision.
"We strongly believe that the FCC should fully and fairly review the detailed record associated with M2Z's license application…and make a decision consistent with the law Congress enacted," said Uzoma Onyeije, vice president of regulatory affairs for M2Z. The plan was filed with the FCC in May of 2006, and M2Z had not heard any response until this week. M2Z has claimed that regulations required the FCC to respond by May 5.
"M2Z has been very patient on behalf of the millions of Americans who would benefit from our proposed service," said Milo Medin, M2Z's Chairman. "It took the FCC nine months to seek comment on our application, which is as long as it took the Commission to decide the largest telecommunications merger in history, the BellSouth/AT&T merger. Not only is it the law, but it is commonsense to give license applications that increase competition at least the same treatment as license transfer applications for mega mergers that lessen competition."
According to Dan Frommer, "the FCC has received complaints for the way it has handled auctions in the past, but very few of them were about the fact that they generate billions in revenue for the government. Plenty of companies would spend plenty of money for this spectrum." He continues by asking, "so why give it away in exchange for future revenue the government may never see?" Very good question. I am sure that has something to do with the commission's current decision.
M2Z Networks should be concerned about much more than just the FCC, however. Ed Oswald of Beta News mentions "traditional telecommunications companies, who likely see the M2Z network as a serious threat to their hold on high-speed Internet services." These companies generate a lot of revenue from charging for high-speed internet access and I am sure that they will put up as much of a fight as possible.
