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Broadband Access
Google eyes UK mobile market
Considers bid for 900MHz wireless spectrum
by Iain Morris
Google is said to be considering a bid for wireless spectrum in
the UK. If it goes ahead and wins, the Internet giant could
emerge as a serious rival to mobile operators like Vodafone
and O2.
Reports in the UK press claim Google has expressed interest
in acquiring a portion of the spectrum held by Vodafone and
O2 that Ofcom wants to reauction.
Earlier this week the UK regulator said it would "take back"
some of the spectrum given to the UK's two largest operators
in 1985 and used to support a 2G mobile service.
It thinks a new auction for the spectrum in 2009 could raise
as much as US$6 billion for the UK economy. Neither Vodafone
nor O2 will be allowed to bid.
If Google won spectrum it would be free to launch a wireless
broadband service, as Ofcom has said it will lift current
restrictions on the use of the spectrum.
Google has already announced plans to bid for wireless
spectrum in the United States early next year (see
Google draws fire over 700MHz auction). It is also thought to be developing a mobile phone and a mobile payments service.
Troubling signs
Signs that Google wants to become a player in the UK's
mobile market will be read with concern by the country's five
existing network operators.
Given a chunk of the 900MHz spectrum on offer, Google
would be able to roll out a new mobile broadband network at
a fraction of the cost of any existing 3G network in the UK.
Because 3G networks deployed by Vodafone, O2, Orange, T-
Mobile and 3 use a much higher frequency band, they require
more base stations. Ofcom itself estimates that operators
using 900MHz to deploy a nationwide 3G network would need
10,000 fewer base stations.
But Google would have other advantages, too. It could exploit
its massive lead in the content and advertising industries in
its new role as a telco, attracting customers by offering a
heavily subsidized or free service.
That could also worry Pekka Ala-Pietilä, the former president
of Nokia, who plans to launch a mobile service funded entirely
through advertising in the UK towards the end of the year.
Vodafone and O2 have until November to respond to Ofcom's
spectrum proposal.
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