Choosing cell-phone or internet service these days is kind of like choosing among the Republican presidential candidates this year: all of the options pretty much suck… and not in drastically different ways.

News is that two major tech-sector players are contemplating a Thompson-esque entrance into the telecommunications field, an entrance that may leave the telcom stalwarts looking like Larry Craig cuffed to a urinal.

Developments turn on the major FCC bandwidth auction to be held in January. The auction will put the cyberspace equivalent of the entire Malibu coastline on the block— a fact not lost on the FCC, which is calling the wireless real estate “beachfront property.”

In late August, it was widely reported in business and technology media outlets (read The Register article here) that, according to CEO Eric Schmidt, Google would “probably” enter a $4.6 billion bid for the 700 MHz frequency of the wireless spectrum. The 700 MHz frequency is up for grabs because it will be completely vacant of any other wireless traffic once the deadline arrives for the implementation of an FCC mandate that all TV broadcasts be 100 percent digital by 2009.

Earlier this week, Business Week reported that Apple is now considering a bid as well. Analysts have written a lot about why this move doesn’t seem to fit with Apple’s business model, but more intriguing are the implications of such a move for Joe Consumer.

In a nutshell, the 700 MHz represents (forgive the hackneyed metaphor) an(other) information highway. That highway is currently traveled solely by big network TV signals. Once the TV broadcasts go digital, however, the highway will be empty, opened up to all variety of “travelers,” including TV, internet, or mobile phone signals.

Google first grabbed the attention of the AT&Ts and Verizons of the world by telling the FCC it would offer a substantial starting bid if, among other things, any device could access this frequency without requiring some affiliation to the owner of the frequency.

In other words, you could buy your LG enV or iPhone or whatever and it would not be carrier-specific. You could theoretically buy a phone made by AT&T and get your plan from Verizon because there would no longer be any stipulations that you had to get your signal and plan from AT&T. Couple that with the idea that Google, Apple, and all the other major players would have their own networks as well… meaning everyone will be competing for business on all three fronts, because each company can bid for and buy its own stake in the 700 MHz spectrum.

The way it is now and has been for long time is sort of like Dell saying you have to buy a Dell computer and pay Dell a monthly fee to access Dell’s internet; your only alternative being to buy a Hewlett-Packard computer and an Hewlett-Packard internet plan that gets you onto Hewlett-Packard’s internet (which looks pretty much just like Dell’s)— Dell and HP meeting once a year to determine what the best service costs should be so they don’t step on each other’s toes as they laugh their way to the bank. Talk about a vice-grip.

In the brave new world that 700 MHz represents, Google or Apple could also function as internet service providers. The frequency allows for faster speeds than current 3G or WiFi networks and moves through buildings and bad weather with ease. Apple could create an entire network designed specifically for its products. An update to your iPhone calendar simultaneously updates your .Mac email account, your iPod Touch in your car, and your iMac at home, as well as your significant other’s iPhone and iMac, which can view your calendar. All instantaneously. All wirelessly.

The possibilities are endless. Established 2nd-tier providers like Earthlink would no longer have to rent bandwidth from AT&T. Other big names, like Ebay, Yahoo, and DirecTV, are also setting themselves up as potential bidders— either independently or as partners.

Did someone say innovation by way of true free market competition in the telecommunications arena? Almost unbelievable.

Considering that Verizon and AT&T have plunked billions into the development of their current networks, and that this 700 MHz bandwidth is the last swath of publicly available frequencies to be up for grabs (the rest belong to the defense department and HD broadcasts), I’m sure those two would love to squash this uprising, effectively securing their profit-sharing oligopoly for the foreseeable future.

Write the FCC and let the government know you support opening up the 700 MHz frequency in order to create real consumer-benefiting market competition. Write Google. Write Apple. Write your local congressman and senator. Tell your friends. Drum up support for the bidding.

And then keep your fingers crossed that you never have to decipher another mess of nondescript, miscellaneous AT&T charges on your cell phone bill again.

Tags: 700 mhz, broadband auction, fcc, google