End to 'will they, won't they?' as Google decide to bid on 700 MHz wireless spectrum.

Well, the waiting is finally over - Google have announced that they will be bidding on the 700 MHz wireless spectrum.

" These radio waves are being returned by broadcasters as they move from analog to digital signals early in 2009. The signals can go long distances and penetrate thick walls. The auction is seen as a last chance for a new wireless player."

In it's core search and advertising businesses, Google has been a great leveler for the little guy, who has been able to reach audiences that would have been traditionally unreachable. They have created incredible value for their shareholders by playing nicely with others, and by not being evil.

It's our belief that if Google were to win this auction for spectrum, they would focus on building out the enabling infrastructure and open up that platform to independent ISPs to deliver service to business and residential customers across the US. Let's not kid ourselves that this would be an altruistic act on their behalf, but they have continually shown by their actions that if they do play nicely with others, everybody wins (especially Google).

Increased video usages consumes excess bandwidth - bottleneck ahead

USA Today had an interesting article today - Video, interactivity could ensnare Web users by 2010 - based on a study by business technology analysts Nemertes Research.

The study assessed both infrastructure investment and current/projected traffic patterns independently, and compared the two. While the findings indicated that "core fiber and switching/routing resources will scale nicely to support virtually any conceivable user demand, Internet access infrastructure, specifically in North America, will likely cease to be adequate for supporting demand within the next three to five years."

While they don't suggest tha the Internet will collapse, "users will experience a slow, subtle degradation, so it's back to the bad old days of dial-up," says Nemertes President Johna Till Johnson.

In looking at how bandwidth is being consumed, Johnson highlights YouTube. "Two years ago, nobody knew what YouTube was. Now, it's generating 27 petabytes (27 million gigabytes) of data per month."

Much of today's traditional telecommunications infrastructure (cable, DSL, FioS, satellite) is architected for asynchronous delivery of content to both business and residential customers. Wireless technologies, being more scalable, flexible and rapid to deploy has an opportunity to be a 'bypass' technology, alleviating the coming bottlenecks to deliver the Internet experience that consumers are looking for.

Different target markets - similar business model

Associate Press put out a good story on our competitor, Towerstream - wireless links give businesses an option

It talks about how they target business customers requiring high-capacity circuits, and describes their strategy as "getting rooftop rights on tall buildings, set up antennas, and start calling all the offices it can see".

While there are similarities between what we do (i.e. targeting high-cap business customers, where higher revenues cover equipment costs), there are also a couple of major differences.

Towerstream focuses on major metropolitan markets (e.g. New York, Chicago, Los Angeles, etc.), whereas NextPhase focuses on secondary and tertiary markets, with our rationale being that there is less competition / more demand in these markets, with lower costs for roof rights, etc. Also, instead of relying on large sales teams to win new customers, our strategy is to identify markets that we wish to enter, acquire traditional wireline B2B ISPs in those markets, and then proceed to overlay a wireless footprint and migrate those customers.

Why am I comfortable talking about a competitor. Because our real competitors are the incumbent telcos, who currently offer business customers few options between a 1.5Mbps T-1 and a 45Mbps DS-3. That is the target market for NextPhase and Towerstream, and right now, it's more than big enough for both of us.