• BusinessWeek, Monday, September 10, 2007 11:01 AM

Sources tell BusinessWeek that Apple is considering joining the Federal Communications Commission's January auction for the last chunk of radio spectrum sizable enough to create a new wireless network. The 700Mhz spectrum has been called "beachfront property" by the FCC because of its size and speed; BusinessWeek says its signals would provide "far faster" Web access than existing cellular or Wi-Fi networks, unaffected by weather and able to pass through buildings.

For Apple, there's very low risk in competing in the auction, the report says. The minimum bid is $4.6 billion--although experts believe the portion for a new nationwide network will go for around $9 billion; Apple has $14 billion in cash. The biggest risk for the electronics maker, perhaps, is mounting competition with Google, whose plans to both bid in the auction and develop lower-cost wireless services have been well-documented. Other would-be nationwide network builders include DirecTV and eBay--the online auctioneer is a particularly interesting one, considering that it owns the voice over IP provider, Skype.

Apple, of course, has a head start on all of these companies, thanks to the iPhone. Its combination of hardware and software distribution is unparalleled; a nationwide network would be the final piece of the wireless puzzle, allowing it to offer wireless service and operating and browsing software through its line of iPhones without worrying about appeasing the big telecom network carriers. Being in control of each piece of the puzzle would enable Apple to provide everything at a lower cost than its competitors (a "superior walled garden," says BusinessWeek). So watch out, Google (AT&T, Verizon, et al.).

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