Guess who’s bidding for wireless spectrum?

December 19, 2007, 6:25 PM UTC

By Michal Lev-Ram

What do Microsoft co-founder Paul Allen, search company Google (GOOG) and energy giant Chevron (CVX) have in common? All three are potential bidders on the Federal Communications Commission’s (FCC) upcoming wireless airwaves auction.

The bidding for the coveted 700 MHz spectrum (originally used for analog TVs) doesn’t start until January 24, but late yesterday the FCC released the names of the 266 companies and individuals who have applied to bid. Wireless veterans like Verizon (VZ) and AT&T (T) were on the list,  but so were lots of unconventional hopefuls – including a media company, cable operators and a chipmaker. It’s long been known that Google had its sights set on the prize (at least that’s what the company’s said publicly), but many of the other non-telco applicants on the list came as a surprise.

The diversity of the companies on the list is an indication of the changing wireless landscape in the United States. Just a few years ago, a Silicon Valley company wouldn’t have gotten involved in a spectrum auction – they would have left that challenge to the telcos. But as the future becomes increasingly mobile, everyone wants a piece of the wireless pie.

“With new and upcoming technologies, consumers are going to be able to go mobile with full Internet capacity, and that’s driving non-wireless players to say ‘Hey, we need to be in mobile too’,” says Charles Golvin, a wireless analyst with Forrester Research.

That’s also led to a push to “open up” the U.S. industry – traditionally controlled by mobile operators’ tight grip on phonemakers, developers and, of course, consumers. That’s why Google, unable to spread its mobile applications as freely as it would like, lobbied the FCC to make the upcoming 700 MHz spectrum open to all devices, regardless of who wins the auction.

But, despite the changes afoot, it’s unlikely Google or any of the other unconventional bidders will actually win licenses in the auction.

“I personally believe that we’re not going to see a lot of new entrants in the actual building out of networks,” says Golvin, who expects AT&T and Verizon to be the most aggressive bidders. “Operating networks is only for the few and hearty souls.”