30 August 2007

M2Z and 2.1GHz

This article, posted over at Ars Technica, is interesting. It describes a proceeding before the FCC by M2Z networks. What is interesting is that M2Z is proposing that the up-front payment for the spectrum (which is the policy in the US) be substituted by a payment of 5% of gross revenues. In essence, the US becomes an investor in the network, and stakes its return on the success of M2Z's business plan and its management's ability to execute it.

What are the advantages and disadvantages of this for stakeholders (eg. government, M2Z, M2Z's competitors, and US taxpayers)? If this plan is adopted, should the US government have a voting role in M2Z's board? If so, who would do this?

Update (2007-09-10): While this may be old news at this point, CNET reported that this proposal was voted down by the FCC.

Update (2007-09-24): The Washington Post had this article about M2Z's system.


Edward said...

The US government leases out public property (like land) all the time without becoming an investor or requiring a board seat.

Martin Weiss said...

Do they receive a fixed price for these leases or is it based on a percentage of gross revenue?