Former FBI chief joins wireless auction group

By Peter Kaplan

WASHINGTON (Reuters) - Former U.S. FBI Director Louis Freeh threw his support behind a start-up wireless company that is proposing to build a national network shared with commercial and public safety users.

Freeh said he had joined in support of a plan by Frontline Wireless, whose proposal is part a plan to bid on valuable wireless airwaves at an upcoming auction by the Federal Communications Commission.

"This auction is just the last chance in my time to see some effective plan (for a wireless network for public safety agencies) be implemented," Freeh said at a press conference organized by Frontline.

Freeh was a federal judge in Manhattan from 1991 to 1993 and served as director of the Federal Bureau of Investigation from 1993 to 2001.

He is the latest of several former government officials recruited by Frontline in an effort to bolster its proposal for the 700-megahertz band airwaves auction. Also behind Frontline are two former FCC chairmen, Reed Hundt and Mark Fowler.

Freeh's addition to the group comes at a time when potential bidders and consumer groups are waging a fierce lobbying campaign directed at the FCC, which is preparing to issue key rules that will govern the auction. The agency is expected to hold the auction later this year.

Analysts with Stifel Nicolaus said in a research note on Thursday that auction rules proposed earlier this week by FCC Chairman Kevin Martin would include a provision requiring part of the airwaves also be shared with public safety agencies such as police and firefighters.

But the Stifel Nicolaus analysts said other features of Martin's auction proposal -- which has so far only been circulated among the other four FCC commissioners -- might make it "insufficient for Frontline's plans."

Also at issue in the auction are "open platform" rules sought by Frontline, some consumer groups and Google Inc., which has been studying whether to take part in the auction.

Open-platform conditions would require the winning bidder to make the airwaves accessible to customers using any device or software application.

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

The open-platform approach is opposed by existing wireless carriers such as Verizon Communications. They say it would lower the value of the airwaves.

The proposal that Martin has circulated among the other four FCC commissioners would impose some open-platform requirements. But it would stop short of the auction requirements sought by Frontline, Google and the consumer groups.

They want the FCC to go a step further and require any winning bidder to resell some of the airwaves to potential competitors, a provision they say will foster competition.

But the Stifel Nicolaus analysts said the conditions proposed by Martin may not be enough to allow challengers to outbid existing, or incumbent, wireless carriers like Verizon.