Verizon Dumps on Open Access, Sues FCC

http://blog.wired.com/business/2007/09/verizon-dumps-o.html

Verizon Dumps on Open Access, Sues FCC
By Bryan Gardiner
September 13, 2007
Categories: Legal, Telecom, Wireless

Casting aside all pretense of public interest (and concern for corporate image), Verizon Wireless filed a petition in the U.S. Court of Appeals for the D.C. Circuit earlier this week decrying the open access rules pertaining to the FCC's forthcoming 700 MHz auction.

Despite the conventional wisdom that carriers would avoid challenging the 700 MHz auction rules, Verizon Wireless confidently assumed the role of industry jerk earlier this week by asking the federal court to overturn the FCC's open-access rules calling them "arbitrary and capricious, unsupported by substantial evidence and otherwise contrary to law."

To be clear, Verizon has not sought a stay to prevent the auction from actually starting on Jan. 16, 2008. It apparently just wants the government (and everyone else) to know that competition won't be appreciated. This, in and of itself, is odd because the company, under anti-trust precedent, would not be able to even hold this yummy spectrum, according to Frontline Wireless.

In reaction to Verizon's legal move, Frontline observed that the petition "throws a wrench into the auction to promote competition and innovation for consumers…," adding that "[the company] is challenging the FCC for doing what Congress required it to do in the first place -- ensure that auction policy is guided solely by the public interest."

Google's not too impressed, either. On the company's Public Policy Blog, Chris Sacca said "It's regrettable that Verizon has decided to use the court system to try to prevent consumers from having any choice of innovative services. Once again, it is American consumers who lose from these tactics."

Indeed, Verizon's short petition (.pdf) seems to prove, among other things, that the open access rules being imposed (for now) on the 22 MHz block really do have the potential to give consumers more choices.

Of course, what's even more odd about all of this is that those two open access rules the FCC granted to Google and others are in fact not all that guaranteed. Here's an interesting little portion of the current auction rules:

…if the license block that had been conditioned on limited no-locking, no-blocking requirements fails to sell for at least $4.6 billion, it will be re-auctioned in smaller chunks without any conditions applied.

That escape clause, as communications law professor Susan Crawford notes on her blog, could very well "hand the industry the pen to write the auction rules and to constrict all the opportunities this spectrum held forth."

In response to Verizon’s move this week, Crawford also had this to say:

The very modest, much-less-than-halfway measures taken by the Commission are under attack -- which shows how vitally uninterested these incumbents are in having their business models undermined. Even for a tiny piece of spectrum. Even when they already have all the frequencies they need.

Verizon was not immediately available for comment and was last seen punching old ladies and stealing candy from babies.