Bloomberg is WRONG. Google did not "game" anyone.

Instead, they did what they had to do to make the U.S. Wireless market competitive with the EU. Bloomberg News writes:

Google Inc. manipulated a U.S. government spectrum auction by bidding just enough to trigger rules that will open a nationwide set of airwaves to any device and then walking away, Republican lawmakers said.

The so-called open-access requirements, also backed by consumer groups, may have shortchanged taxpayers by discouraging more companies from bidding, Representative Fred Upton, a Michigan Republican, said today at a hearing.

``Google was successful in gaming the system,'' Upton said. The rules were a ``social engineering'' experiment by the Federal Communications Commission that prevented the spectrum swath, known as the C-block, from raising billions more

Once again, I will refer everyone to my post from yesterday where I note that Google gave Kevin Martin ("K-Mart") the ammunition he needed to fix the errors of the 1996 Auctions. 

Enter Google. Their proposal for a reserve price and open access was supported by Chairman "K-Mart," who probably has nightmares about NextWave when he thinks of auctions. Why? 

Easy. "K-Mart" can't order or ask for a subsidized network, but the FCC can order a reserve price, open access, and a build-out requirement.

What's the result? The 700mhz auction suddenly becomes a de facto low bid contract. Google hit the reserve, and the rest of the players simply bid enough to win, hoping the other would lose, because either way, the network would be open to everyone. The FCC won because they got their open network, allowing for more competition ("K-Mart" likes competition) and Google won because they can develop their Android phones and be assured that they will have a network to operate on.

This wasn't an auction. It might have started as one, but it finished as a low-bid RFP...and that's a good thing for all of us.