FCC proposes free Internet

WASHINGTON (Reuters) - U.S. communications regulators are
considering auctioning a piece of the airwaves to buyers willing to
provide free broadband Internet service without pornography.

Federal Communications Commission Chairman Kevin Martin is proposing
to auction an unused piece of 25 megahertz wireless spectrum, with the
condition that the winning bidder offer free Internet access and filter
out obscene content on part of those airwaves, a spokesman for the FCC
said on Thursday.

"We're hoping there will be increased interest in the proposal; and
because this will provide wireless broadband services to more
Americans, it is certainly something we want to see," said FCC
spokesman Rob Kenny.

Under Martin's proposal, the winner would be allowed to use the rest of the airwaves for commercial services.

The plan would address criticism from some consumer advocates, who
say the government has not done enough to get broadband service into
more households. It also could win praise from anti-obscenity watchdog
groups.

"I think there are a number of features of the plan that would be
attractive to various constituencies," said Stifel Nicolaus analyst
Blair Levin.

But the plan got a lukewarm response from existing wireless
carriers. The industry's chief trade group, called CTIA, said auction
provisions such as the free-service requirement were too rigid.

"CTIA supports flexible auction rules that allow any and all entities to participate," the group said in a statement.

The winning bidder also would have to build out the system to serve
50 percent of the U.S. population within four years and 95 percent
within 10 years.

Further details of the plan have yet to be worked out, but Martin's
plan is expected to come up at the FCC's next meeting on June 12.

Martin's proposal is similar to a plan put forth previously by a
start-up company called M2Z. Under that plan, which was not approved by
the FCC, M2Z would have been given the spectrum at no up-front cost. It
would have provided free service, generating revenue partly through
advertising.

The 25 MHz spectrum at issue is not viewed as highly attractive to
wireless carriers, unlike the 700 MHz spectrum auctioned by the FCC
earlier this year. There has been little previous interest in it, aside
from the M2Z proposal.