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9/14/2007
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Verizon Wireless Sues FCC Over 'Open' 700 MHz Auction Rules

The suit asks the FCC to change its stance on the part of the rules that would create an open network allowing wireless consumers to use mobile phones of their choice.

Verizon Wireless, which had previously agreed to the terms of the upcoming 700 MHz spectrum auction, reversed course this week when it filed a formal lawsuit challenging the Federal Communication Commission's rules.

The appeal, submitted Monday, asks the FCC to change its stance on the "open" provisions of the rules, which could create an open network that would enable wireless consumers to use mobile phones of their choice and to download software of their choice.

"Verizon Wireless challenges that part of the (FCC) Report and Order which adopts what the Commission refers to as an 'Open Platform and Application' mandate as part of the service rules for the C block of spectrum in the upcoming 700 MHz auction," stated Verizon's appeal filed with the U.S. Court of Appeals for the District of Columbia Circuit.

The lawsuit drew a quick response from Google, which has been considering bidding in the auction and thereby becoming a competitor to Verizon Wireless.

"It's regrettable that Verizon has decided to use the court system to try to prevent consumers from having any choice of innovative services... The FCC's auction rules are designed to allow U.S. consumers -- for the first time -- to use their handsets with any network they desire and download and use the lawful software applications of their choice," Google said on its public policy blog,

Verizon Wireless, which is a partnership of Verizon Communications and Vodafone Group, said in its appeal filing that the FCC rules are "arbitrary, capricious, unsupported by substantial evidence and otherwise contrary to law."

Before the FCC rules-setting meeting, Verizon had been trading barbs with Google, accusing the search engine of wanting to "rig" the auction. But, in a last minute accommodation, Verizon said it would back some provisions to set aside a portion of the 700 MHz spectrum for open access.

However, Monday's legal filing noted that the FCC went beyond what Verizon would support. Verizon and other established wireless service providers maintain that existing wireless infrastructures already deliver innovations, which are improving service to subscribers.

The auction is expected to take place on January 28, 2008 and is expected to raise as much as $15 billion for the U.S. Treasury.

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