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Schmidt denies Google wants 'dumb pipe' carriers

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Eric Schmidt has claimed that Google does not want to turn the world's wireless carriers into "dumb data pipes."

The Google chief exec made the claim on Tuesday during his keynote speech at the Mobile World Congress in Barcelona, after a conference attendee accused the company of harboring such dumb pipe desires - of trying to "reduce the role of the operators in the market" with its perpetual "open network" government lobby.

It was an amusing exchange, with this rather animated audience member insisting - in the middle of his argument - that Schmidt was agreeing with him, before the Google boss interrupted to say otherwise.

"To me, it looks like Google wants to turn the mobile operator into a dumb data pipe, where you [Google] provide all the services on top," the audience member told Schmidt, before noticing that the Googler's head was nodding up and down. "I see your head is saying 'Yes.'"

"Stop. Stop," the Schmidt interrupted. "I have no objection to your question. But that's not what I said. I was [just] acknowledging your question."

The exchange - which you can see here (registration required) - continued with the questioner ultimately asking Schmidt: "Who's going to make the investments in infrastructure in the future if the operators don't have the possibility of turning themselves into intelligent pipes?"

Naturally, the pointed question was met with applause from the typically pro-carrier MWC.

"I disagree with your premise completely," Schmidt answered - despite the fact that Google has worked overtime to "reduce the role of the operators" while boosting its own role in shameless fashion. Mountain View has even gone so far as to enlist Verizon as a partner punting its mobile OS and services before turning around to compete with the US operator by selling its own handset.

Schmidt preferred to focus on a narrow definition of dumb pipe. "In the first place, I feel very, very strongly that we depend on the successul businesses of the operators globally, and I disagree that we're trying to turn the operators into 'dumb pipes,'" he said. "On the contrary, we need advanced networks that deal with, for instance, security, that deal with dynamic signaling, that can deal with load balancing."

We do indeed.

The questionner went on to ask whether Google would "invest in infrastructure" in the future, and Schmidt insisted the company would not - at least not "on a broad-scale."

"We will have the operators do it," he said.

In January 2008, when the Federal Communications Commission auctioned off the "700-MHz" spectrum, a prime portion of the US airwaves, Google was among the bidders. But the company later said that actually winning the spectrum was not its top priority.

After heavy Google lobbying, the FCC had agreed to attach an "open access" requirement to the spectrum if bidding reached a $4.6bn reserve price, and it was a Mountain View bid that took the auction past this magic threshold - before the company's bids petered out. ""Google's top priority heading into the auction was to make sure that bidding on the so-called 'C Block' reached the $4.6 billion reserve price that would trigger the important 'open applications' and 'open handsets' license conditions," Google lawyers wrote in the wake of the auction.

During Schmidt's Tuesday keynote at the Mobile World Congress, that animated conference attendee also accused Google of "playing a poker game" with the US spectrum. "Everyone was guessing you would invest in infrastructure, and then you pulled out at the last minute," he said.

"Do you think that was a deliberate strategy on our part?" Schmidt responded. "You're making an assertion. Ask it as a question, and I'll answered it, so we can establish the facts."

A question about Google's 700-MHz play never actually arrived, and the questioner's microphone was eventually taken away. "That was certainly not my request," Schmidt insisted, before repeating some, yes, net neutrality boilerplate.

"You were probably asking about network neutrality," Schmidt said. "We actually believe that it's important for operators to be able to deal with too much capacity and misuse of the networks. We understand at a fundamental level that wireless network have constraints on them. The only specific issue we have is that we don't want operators to be able to choose between different vendors of the same kind of content."

Thank you, Eric. We might also add that Google does want to put its very own mobile operating system on as many phones as possible - including its very own handsets - so that its very own ad-laden services can receive prime placement above everyone else's. But that goes without saying too. ®

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