Beachfront Wireless

(page 2 of 2)

Part of the reason for the sheer number of Wi-Fi devices is the lower production cost that comes with an open network and open standards coupled with the assurance of a mass audience. SmartSynch, a Mississippi company that makes "smart" utility meters that can transmit their readings using either cellular or Wi-Fi networks, spends more than $150,000 to obtain device certification from a cellular operator to connect with its network. By contrast, all they need for a Wi-Fi-style network attachment is FCC certification, which runs about $10,000.

Wi-Fi Carnival

That said, because the signal from a single Wi-Fi transmitter can only travel hundreds of feet, it's harder to use the technology to provide the sort of blanket wireless reception you get with a cellular network. In addition, the signals can be too weak to reach indoors if there aren't enough transmitters.

It's here where the 700MHz licenses in question become quite attractive. First, network operators will be able to transmit with 1,000 times the signal power of Wi-Fi, allowing far fewer transmitters. Second, 700MHz radio waves travel further than higher-frequency signals. A single 700MHz base station covers four times the area as the same signal power from one of the 2,500MHz base stations used by Sprint Nextel (S) and Clearwire (CLWR) to build a new national network.

But while the propagation of radio waves is of interest to the big cell carriers, Wi-Fi's carnival-like inclusion is not. The carriers are most interested in keeping tight control over their networks and the devices that connect to them.

Cellular Example

Take Verizon Wireless (the joint venture of Verizon Communications (VZ) and Vodafone (VOD)), which limits its customers to perhaps 100 phones and devices, such as computer cards for wireless Internet access. Using those phones, customers can buy ringtones, songs, videos, and games only from Verizon's authorized partners. Even with a $60 "unlimited" wireless data plan for a computer, Verizon's terms of service only allow customers to check e-mail, surf the Web, and use certain business applications—to a point. (Seriously, read the fine print of the company's terms and conditions.) Dare to use more than 5GB of data a month, and you'll receive a summary "buh-bye" letter from the carrier despite the "unlimited" label on its service.

Under the auction terms for the slice of the airwaves that will come with new strings attached, no carrier will be allowed to impose conditions on handsets or activities. But they will still be allowed to restrict your bandwidth and deny access to devices that "harm" the network. Since Verizon already treats streaming video or more than 5GB of data per month as harmful to its network, there's no reason to suspect they wouldn't make the same case in the so-called open 700 MHz band if they win the licenses.

It's absurd to say that the conditions urged by Google and others would have ushered the creation of a third broadband alternative on par with high-speed DSL and cable modem connections. It's also naive to think that Google's motives are all pure. But the cold, hard fact is that this auction represents the last chance to exploit a substantial hunk of spectrum that we may see for 10 to 20 years.

We could have had dancing rabbits; instead, we'll have more of the same.

Fleishman is the editor of Wi-Fi Networking News (wifinetnews.com), a daily blog on developments and issues in the wireless data industry.