What does Verizon’s victory in the auction mean to Vodafone?

The impact of the FCC’s 700 MHz auction is amazing. I mean, who would have ever thought that the results of FCC auction could have an impact on the stockholders of Vodafone? Confused? Read on.

Verizon Wireless, in case you don’t know, is a joint venture between Verizon Communications and Vodafone. Now, as we all know, Verizon has won a major chunk of the wireless spectrum in the recently concluded auction. It paid close to an astronomical $5 billion for the licenses it acquired and it has got reflected in the stock prices of Vodafone.

Investec, a prominent South African bank, has advised its clients to sell Vodafone shares as it predicts its dividend payments to be delayed. Now, I’m not a stock market analyst or something. In fact, I have no idea of anything remotely associated with stock market. Could someone explain this?

Categories: All things mobile phones.

0 comments.

Is Google the real winner in the FCC auction?

Finally, the most anticipated FCC auction for 700 MHz wireless spectrum is over. Verizon and AT&T have acquired a substantial number of licenses. As I promised in my last post, I have to tell you what this means to Google.

First things first. We all know Google is clever. When people went wild with their speculations about the auction, Eric Schmidt would have probably smirked. The reason being – Google probably never intended to win the auction. In fact, even before the auction, it got what it wanted.

The open access theory was formulated by Google and FCC made it clear that the winner of the spectrum should allow their users to choose any handset they want and run any application they want on their mobile phones. In other words, even if Verizon or any other company wins the auction, they will not be able to make their subscribers use a particular mobile phone with a particular application. This leaves a gap large enough for Google to bring in its Android supported devices. Clever, isn’t it?

As we already discussed, the costs involved in running a network are huge and Google never actually intended to do that. Instead, it will make money, irrespective of who wins the auction, through mobile advertising.

Now, at the end of the auction, Google actually didn’t win any license. But instead, it made Verizon and AT&T pay big bucks for the licenses. Now, Google will be happy to introduce its Android based mobile phones with tons of applications, which people will be happy to use. So, without spending big bucks for licenses in the auction, Google will be able to make money – through advertising.

Now, is that brilliant or what?

Categories: Cell Phone Advertising, Google, All things mobile phones.

0 comments.