Nov. 30 (Bloomberg) -- Google Inc., owner of the most-used search engine, will apply to bid in the U.S. government's auction of wireless airwaves to take advantage of the growing market for mobile-phone advertising.

The Mountain View, California-based company won't enter a joint bid with T-Mobile USA Inc. or another wireless carrier and instead will shoulder the entire cost of any spectrum it buys.

Google will ``put our money where our principles are'' after lobbying the Federal Communications Commission to require that some airwaves in the January auction be left open to phones not designated by the wireless carrier that wins the spectrum, Chief Executive Officer Eric Schmidt said today in a statement. The minimum bid for the open-access airwaves is $4.6 billion.

``If they're not partnering, it means that they have sufficient funds to win the auction,'' said Trip Chowdhry, an analyst at San Francisco-based Global Equities Research. Google could ask another company to help it build a network if it wins, he said.

Google may spend $12 billion or more to acquire airwaves suitable for wireless Internet access, including the portion the FCC has designated for open access, said Chowdhry, who advises buying the company's shares and doesn't own any.

The airwaves the government is selling are optimal for high- speed data connections. Google wants wireless service providers to allow more handsets on their networks to increase the time consumers spend surfing the Web. Online advertising accounts for 99 percent of Google's sales.

Mobile Ad Growth

Spending on mobile-phone ads will rise more than fivefold to $11.4 billion in 2011 from $2.17 billion this year, according to Informa Plc, a London-based research firm.

Google may choose merely to bid the $4.6 billion reserve price as a ``token gesture'' to the FCC for imposing the open- access rule, Jason Armstrong of Goldman, Sachs & Co. said in a Nov. 28 research note. In that case, Google would probably lose the auction, the New York-based analyst said.

Google fell $4 to $693 at 4 p.m. New York time in Nasdaq Stock Market trading. The shares have increased 50 percent this year.

Other bidders in the auction will include AT&T Inc., owner of the largest U.S. mobile-phone service, and Verizon Wireless, the second-biggest wireless carrier.

Randall Stephenson, CEO of San Antonio-based AT&T, said at a public appearance in Santa Clara, California, Nov. 28 that his company will participate.

`Beachfront Property'

``We refer to it as `beachfront property,''' he said. ``It doesn't get any better than this.'' The airwaves could be used for video or high-speed Internet, he said.

Verizon Wireless will also take part, said Jim Gerace, a spokesman for the Basking Ridge, New Jersey-based company co- owned by Verizon Communications Inc. and Vodafone Group Plc.

Sprint Nextel Corp., the No. 3 U.S. wireless carrier, said today that it wouldn't participate in the auction. The company has enough spectrum to meet its current requirements, said Leigh Horner, a spokeswoman for Reston, Virginia-based Sprint.

Sprint and T-Mobile are both members of the group Google is working with to develop software for mobile handsets.

To contact the reporter on this story: Crayton Harrison in Dallas at tharrison5@bloomberg.net.

Last Updated: November 30, 2007 16:06 EST