Wednesday, December 19, 2007

Spectrum shootout: Paul Allen vs. Google

Paul Allen, the billionaire Microsoft co-founder, will bid against Google for a spectrum license that could be used to roll-out a wireless broadband network across the United States.

Mr Allen and Google join 94 other bidders so far approved by the Federal Communications Commission (FCC), the regulator that is running an auction for a portion of the US airwaves expected to raise as much as $15 billion, documents show.

Other deep-pocketed bid backers include Carlos Slim Helu, the Mexican telecom mogul whose personal fortune was put at $59 billion earlier this year by Fortune, making him the world’s richest man – just ahead of Microsoft’s other co-founder Bill Gates.

However, the most intense competition is likely to come from US mobile incumbents such as AT&T and Verizon Wireless, a joint venture of Verizon Communications and Britain’s Vodafone Group. Both groups face being toppled from their dominant positions in the US mobile industry should they be outbid.

The radio spectrum being sold off by the FCC is situated around the 700MHz band, an asset described as the “Mayfair and Park Lane” of the airwaves.

Made available as television goes digital, it can travel long distances and penetrate walls easily. Crucially it has the potential to become, alongside cable and telephone lines, a wireless “third broadband pipe” – a mobile internet network that would boast speeds comparable to current conventional broadband services.

Mr Allen has applied to bid in the FCC auction, which is scheduled to begin on January 24, through his investment vehicle, Vulcan Spectrum.

A noted philanthropist and collector of Jimi Hendrix memorabilia, he co-founded Microsoft with Bill Gates in 1975 and is now the fifth-richest man in the United States, with a personal fortune estimated at $18 billion by Forbes.

He also heads an investment company called Vulcan Capital and is also a majority shareholder in Charter Communications, the US cable operator.

>>>Gimme more! (Times Online)

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