Verizon Wireless files suit over FCC auction rules

The sign for the Verizon Wireless store is seen in Lakewood, Colorado September 11, 2007. Verizon has asked a federal court to overturn open-access rules that the U.S. Federal Communications Commission is imposing on the winner of valuable wireless airwaves to be auctioned this winter.

WASHINGTON (Reuters) - Verizon Wireless has asked a federal court to overturn open-access rules that the U.S. Federal Communications Commission is imposing on the winner of valuable wireless airwaves to be auctioned this winter.

In a lawsuit filed on Monday, Verizon Wireless asked the U.S. Court of the Appeals for the District of Columbia to strike down the FCC conditions, which would require the winner of the new spectrum to let consumers connect using any device or software.

The January 16, 2008 auction is expected to raise at least $10 billion for the U.S. government from airwaves being returned by television broadcasters as they move to digital from analog signals in early 2009. The airwaves to be sold in the 700-megahertz band can travel long distances and penetrate thick walls.

Verizon Wireless argued that the open-access conditions are unconstitutional, and the FCC overstepped its authority when it approved them on July 31.

Verizon Wireless is owned by Verizon Communications Inc (VZ.N) and Vodafone Group Plc (VOD.L).

The auction is widely seen as a last opportunity for a new player to enter the wireless market.

Currently, wireless carriers restrict the models of cell phones that can be used on their networks. They also limit the software that can be downloaded onto them, such as ring tones, music or Web browser software.

The open-access rules have the support of Google Inc(GOOG.O), a potential bidder in the auction. They also have been endorsed by many consumer advocates, who say it is needed to spur competition in the wireless business.

(Reporting by Peter Kaplan)