UPDATE 1-FCC chairman to oppose Skype open-network petition

(Adds further background, quote from Kevin Martin and Democratic FCC commissioner)

LAS VEGAS, April 1 (Reuters) - Federal Communications Commission Chairman Kevin Martin said on Tuesday he was proposing to dismiss a petition from Web-based phone service Skype to force open wireless networks.

Martin said he would circulate a proposal among the four other FCC commissioners dismissing the petition which Skype, a unit of online auction leader eBay Inc EBAY.O, had filed a little over a year ago with the communications regulator.

“In light of the (wireless) industry’s embrace of a more open wireless platform, it would be premature to adopt any other requirements across the industry,” Martin said in prepared remarks at the annual U.S. wireless industry trade show in Las Vegas.

To cheers from the audience of mobile industry insiders, Martin said he was opposing the Skype petition because of a need to strike a balance between supporting innovation and investments in network infrastructure by telephone companies.

Skype has attracted hundreds of millions of users worldwide to its free or low-cost Web-based phone calling services. It relies on peer-to-peer technology that distributes network capacity among users signed on to the system.

At the center of Skype’s petition are open-platform “Carterfone” requirements, named after a precedent-setting decision by the FCC in 1968, which forced the Bell telephone monopoly to open up and allow outside devices to run on formerly closed networks, as long as they did not cause damage to the system.

In recent years, the two largest wireless carriers, AT&T T.N and Verizon Wireless, have agreed to abide by open-access principles.

Verizon Wireless is a joint venture of Verizon Communications Inc VZ.N and Vodafone Group Plc VOD.L.

The FCC imposed open-platform requirements on a large block of the 700-megahertz wireless spectrum recently auctioned by the government. The block was acquired by Verizon Wireless.

But Martin said he has opposed other network-opening proposals that he said would undermine investment incentives.

“This careful balancing of spurring innovation and consumer choice while encouraging infrastructure investment is critical to the wireless industry’s continued impressive growth,” Martin said.

Martin’s proposal to dismiss the Skype petition got a cool response from one of the two Democratic commissioners on the FCC, Michael Copps.

“This is not the time for the FCC to declare victory and withdraw from the fight for open wireless networks,” Copps said.

“While we are all encouraged by preliminary commitments from some of the major carriers, we haven’t seen the details yet on how they are going to proceed -- and the devil is always in the details, isn’t it?” Copps said. (Reporting by Sinead Carew; additional reporting by Peter Kaplan in Washington; Editing by Braden Reddall)