Google bidding for spectrum – not entirely a blessing

Google is really trying hard to get its applications and services into mobile phones. But in the bargain it could be encroaching into every part of our Internet lives from its core business in search, to the Android operating system and applications on phones, to now owning spectrum for mobile telephony and data.

Google announced today that it will apply to participate in the Federal Communications Commission (FCC) upcoming auction of wireless spectrum in the 700 megahertz (MHz) band.

As part of the nationally mandated transition to digital television, the 700 MHz spectrum auction -- which begins January 24, 2008 -- will free up spectrum airwaves for more efficient wireless Internet service for consumers. Advocacy by public interest groups and Google earlier this year helped ensure that regardless of which bidders win a key portion of the spectrum up for auction (the so-called "C Block"), they will be required to allow their users to download any software application they want on their mobile device, and to use any mobile devices they would like on that wireless network, Google said. The winner must ensure these rights for consumers if the reserve price of $4.6 billion for the C Block is met at auction, it added.

Google’s moves in the last few months have been aimed to get its services into mobile phones, thus opening up a new advertising revenue stream for the company. Mobile operators however want to control what applications users download, because they are also beginning to see special services as large potential revenue streams, including from advertising. If Google wants to get into the phones of these mobile operators, it can only do so through generous revenue sharing deals with the operators.

The search giant has hence been pushing for opening up the networks, to further its business interests. The 700 MHz spectrum auction was an opportunity for Google and other groups to advocate to the FCC that at least this part of the spectrum should be kept open by bid winners.

Google has been at the same time pushing the open source Android platform for mobile devices, which will again support third-party applications, including Google’s. However the big players like Nokia are not backing this initiative. Having seen the control and commoditization of the PC platform by Intel and Microsoft, they don’t want something similar in the mobile phone market.

It is not clear at this point whether Google really plans to win the auction, or just meet the reserve price for the auction. Also not clear is whether Google, if it bids seriously and wins, will get into actual network operation. If it decides to do so, not only other service providers and mobile phone makers, but also users should be worried. Google will be playing in too many inter-related markets from mobile networks to mobile devices to applications such as search, giving it a lot of opportunity to control.

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More promises on Palestine, but this time Bush has his reputation on the block

The meetings between Israeli Prime Minister Ehud Olmert, Palestinian Authority President Mahmoud Abbas, and US President George Bush have yielded the promise of immediate talks on a Palestinian nation between Israel and Palestinian leaders, with a final treaty before the end of next year.

"We meet to lay the foundations for the establishment of a new nation, a democratic Palestinian state that will live side by side with Israel in peace and security," Bush said at a news conference in Annapolis, Md., according to this report in the Los Angeles Times.

Abbas will not be taking a damp squib to his fellow Palestinians back in Palestine. Nor will Hamas be able to say that Abbas was taken down the garden path by Olmert and Bush. The prospects for peace in the Middle East are very real.

Unfortunately the chances that the peace talks may be grounded on one of the myriad disputes surrounding the Middle East issue are still high.

The Annapolis agreement is about deciding to talk and make peace, but did not cover any of the substantive issues that divide Palestinians and Israelis. In this sense it is not a lot different from previous confidence building exercises, mediated by the Americans.

There are the issues of boundaries to be discussed, and fought over both at the negotiating table and on the ground. Will Jerusalem be partitioned or stay with Israel ? What will happen to the Israeli settlements once the new nation is formed ? Will Palestine be allowed to run its own defense ? Will Israel be recognized as a Jewish state or will the Palestinian diaspora demand the right to return ?

Palestinian Authority President Mahmoud Abbas said Tuesday that he will not back down on his demand that East Jerusalem be named the capital of any future Palestinian state. Nor will he relent on his calls for Israel to dismantle its outposts in the West Bank, he said, according to this report in CNN.

These irksome issues have been pushed under the carpet for the grand-standing this week. For President Bush this is perhaps his last chance as President to prove his statesmanship, and win a Nobel Prize, as some wags put it. For Abbas it could be a matter of his own and Fatah’s survival that the negotiations succeed without him seeing to concede too much. As for the Israelis, they have to start delivering, rather than look for excuses to delay a resolution. There is a lot of hard work, and tough decisions for all three leaders in the days ahead.

Rioting comes easily to those on the margin in France, anywhere

Villiers-le-Bel was not affected by the 2005 riots in France, but shares many features of other banlieues – an unemployment rate of over 20 per cent, poor transport links with the city centre and a population of 27,000, 60 per cent of whom are under 25, according to this report in The Independent of the UK.

The ghetto violence this week in Villiers-le-Bel is spreading, leading to fears of further outbreaks and a possible repeat of the wave of urban violence in 2005. The immediate provocation for the rioting by the people in the ghettos was the death of two teenagers in a collision involving a police car, according to this report from the BBC.

Rioting comes easily to people on the margin, particularly as they have lost all trust in the police, other authorities, and society at large. Many of these people are migrants of North African origin who do not feel assimilated into French society. Some of them believe that the French police may have deliberately killed the boys on the motorcycle. That is incorrect, according to the French authorities, but try telling that to the people in the ghetto who live forever in suspicion and in simmering discontent.

That discontent in the ghettos can only get worse as French President Nicolas Sarkozy, a firm lover of all things American, tries to push through economic reforms in the country. Common people do not take kindly to having their privileges removed, more so when it is aimed to help big business. The ghetto-ization of France can hence be expected to continue. Add to that the racial and religious divide, and France’s ghettos are a tinder-box.

There are lessons for other countries from the troubles in France. While votaries of big business and unbridled capitalism push for the dismantling of the welfare state and subsidies, such measures push out into the margin larger numbers of people, who become disempowered, and susceptible to militant ideologies, whether secular or religious.

The experience of most countries proves that unbridled capitalism has only increased inequality, as the benefits have not trickled down. In the US, the middle class finds itself facing extinction, being pushed into the lower classes by high costs of everything including healthcare.

The violence in the ghettos of France are a signal. The people living there may not be articulate enough to put out a policy statement against globalization and unbridled capitalism. They will look instead for refuge in the extreme fringes of their religions, which will both give them an ideology and money to live on.

In Mumbai, where its new super rich are spending millions of Rupees on expensive cars and large houses, the poor don’t have an ideology, but a resentment, that is dangerously high, and waiting to be misused. There are potentially other trouble spots as well.

It is unfashionable, but the hard truth is that the resurgence of capitalist ideology in its unbridled form, has only provided an opportunity for the rich to spend and flaunt their wealth without compunction. Charity, if any, has become a matter of prestige, accompanied by a press release. Once upon a time, the wealthy did not display their wealthy – it was seen to be in bad taste, and yes could invite resentment. Charity was on a quiet note and did not humiliate the receiver. Today display is the raison d’etre for capitalist society.

French suburbs still await change after the 2005 riots, according to this report by Reuters. "High unemployment, underperforming schools, poor relations with the police, inadequate housing and controversial new immigration laws have created a generation of frustrated youths ready to turn to violence at any time", according to the report. This could be as much a description of the state of affairs in the ghettos of France, the slums of India, or the black population in some parts of the US. Economic development has to be inclusive, and neo-right economic policies in many of these countries have not helped.


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A mobile Internet bust on the cards ?

Most venture capitalists will tell you that mobile data, accessed by consumers using mobile handsets, is the next big market worldwide. People will use their mobiles to access their mail, do search, social networking, instant messaging, and even blog from their mobile phones. So venture capital has flowed into companies that develop all kinds of mobile applications that will improve the “mobile Internet experience”.

Yahoo’s co-founder David Filo took the hype a little further earlier this year when he said he expected that most people in emerging economies like India would have their first experience of the Internet using mobile phones. The logic, I guess, is that India has been adding between 5 to 7 million new mobile phone users each month, but far fewer new PCs.

But most of the new phones have not been added for Internet connectivity, but plain telephony, and I often wonder how thousands of Indians, whose literacy doesn’t go beyond the ability of dialing a telephone number, are going to find any use for goodies from the Internet.

For those who would like to access the Internet on the move, the better option is a laptop which is not a lot expensive if you need the Internet badly, and you can afford the full-featured PDAs that offer Internet access and other bells and whistles with a mobile phone. Why would an user struggle to enter mail on a PDA when he has the full-blown laptop option, or he can go a cyber café ?

To be sure the mobility is important, but frankly is there any fun in squinting into a miniature browser to read the daily news, or a research report, or a sales report, while at the same time worrying how much that download could be costing you. The moment you decide on mobile Internet, you are talking of costs by the kilobyte, not megabytes, because that is the way the service provider charges you. So browsing for fun on your mobile is an absolute no-no, unless you have a corporate account, and the accounts folks are looking the other way.

I picked up a PDA a few days ago, and I do not use the browser on my mobile to go to my favorite web sites, or download my mail, because it is a lot more expensive than when I am at my laptop, and it is far slower too.

As I would be paying big bucks for a lousy experience, I use the Internet capability on my PDA mainly for emergencies. That certainly doesn’t make me the darling of my service provider. Lots of folks like me can cripple the business plans of those who swear by the mobile Internet.

My friends scoff at me for picking up a PDA and Internet data plan from my mobile provider. Just what is it that I do that requires me to have instant access to my mail or to the Internet ? Can’t it wait say 30 minutes to an hour ? Does it give me a competitive edge ? Or will it only ensure that I lose my eyesight earlier than usual, squinting into the small screen of the mobile phone ?

The data seems to bear my friends out. Yankee Group, a Boston research firm, show that only 13 percent of cell phone users in North America use their phones to surf the Web more than once a month, while 70 percent of computer users view Web sites every day, according to this report in the New York Times.

Data is clearly not a hot application yet on the mobile. The New York Times quotes in the same report an analyst from Rethink Research, who said data would make up only 12 percent of average revenue per user in 2007, far below the expected 50 percent. The 12 percent figure does not include text messaging.

For users of mobile phones to use mobile Internet for one its prices have to hit basement levels, and bandwidth has to improve. That would require service providers to increase their capital outlays even as they have to cut on unit charges. But that is not all. For new users of the Internet there has to be a compelling application on the mobile that will make them embrace the Internet on a mobile phone rather than on the desktop or laptop. For traditional Internet users like me, who use the Internet for work, the Internet on the mobile phone can only be a tool for an emergency.

For now the mobile Internet seems to be the stuff mainly of marketing spiels, and big dreams that may go awry.

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