Chatting with Verizon Wireless's Lowell McAdam
I sat down this morning with Verizon Wireless Chief Executive Lowell
McAdam to talk about the company's recent $9.5 billion purchase of radio spectrum, it moves to open its existing networks, and the hottest applications for cell phone users today. But mostly, he was still riding high on Federal Communications Commission Chairman Kevin Martin's announcement yesterday that he will issue an order to other commissioners to dismiss Internet phone service provider Skype's petition to the agency to enforce open network principals.
"If you bring the government in and they try to regulate, the industry will grind to a screeching halt. Just look at wireline side (which is more heavily regulated). Does anyone invest in the wireline industry anymore? No. They will in fiber and broadband because those aren't regulated," said McAdam.
The debate over net neutrality, the idea of enforcing open Internet principals, has picked up steam in recent months with the FCC holding its second hearing on cable company Comcast's management of its
networks (it admitted it delays some Internet traffic), at Stanford University on April 17. And Martin's comments yesterday sparked a slew of criticism from consumer groups like Consumers Union and Public Knowledge and lawmakers like Rep. Mike Doyle (D-PA). These proponents of net neutrality argue that principals need to be strengthened so that network operators are held accountable for delaying and blocking Internet traffic. In the case of wireless carriers, Skype pushed for the same principals that would force carriers to open their networks to all devices and applications.
Verizon already moved in that direction. They won a handsome block of spectrum from the FCC auction that would be open to all devices and software applications. Last November, it also invited device makers and software developers outside their traditional vendor partnerships to create mobile technologies for their networks. So far, 300 people have downloaded the technical specs for their networks, McAdam said. The result of opening its networks, he said, will be a slew of new innovation.
"It's a very interesting experiment in Verizon Wireless because we've set up direct competition with the open development team and the traditional retail team on who gets the most innovative product to market faster," McAdam said.
He envisions small cell phone watches worn on the wrist with streaming video, navigational capabilities and social networking applications so friends can know where you are and what your plans are for the night. A small rubber wrist band could also act as a constant health monitor, immediately telling your doctor if your blood pressure is at dangerous levels or if your blood sugar level is too low.
Much of this technology isn't here yet, but will be in the near future on its next generation platform technology called Long Term Evolution, or LTE, technology, he said. That's why the company has doled out so
much money recently on new spectrum auctioned by the FCC.
"Spectrum is your lifeblood as a wireless company," he said. "The question for investors is for those who didn't invest in spectrum. What are those people going to do now?"
Think this is overdoing it? After all, about 80 percent of the population has cell phones so will there be market left over?
"Coming from Asia and Europe where penetration rates were 120 to 130 percent, this is nothing. There is still a lot more to go," he said.
April 2, 2008; 1:32 PM ET
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