Google’s plans to bid for a portion of America’s airwaves were dealt a blow last night when the Federal Communications Commission refused to approve two of the internet company’s conditions.

Google had said that it would match the $4.6 billion (£2.3 billion) reserve price set for a 700MHz licence, which could be used to provide wireless broadband internet access across the US from 2009, if the eventual winner was forced to meet four “open access” conditions.

The Federal Communications Commission, the body setting the conditions for the auction, approved two of those terms, which will allow customers to use whatever device and software they want on about one third of the spectrum to be auctioned.

However, two more controversial provisions put forward by Google, which would require the eventual licensee to sell access to its network on a wholesale basis to rivals and allow other parties physical access to infrastructure at realistic points, were not included.

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The auction must be completed by the end of January.

The agreed rules will also allow for the creation of a shared public safety network. Commissioners hope that this will solve many of the communication problems that firefighters and others have experienced during disasters such as the September 11, 2001, terrorist attacks.

The text of the rules was not released at Tuesday’s meeting.

The details contained in the eventual document are likely to determine which investors will commit billions of dollars to develop new wireless networks.

The spectrum to be auctioned can travel long distances and penetrate walls easily – the same characteristics that made it attractive to broadcasters, who are vacating it to make way for all-digital television.

The Congressional Budget Office estimates that the auction’s proceeds will amount to between $10 billion and $15 billion.

A total of 62MHz will be auctioned under the plan, of which 22MHz will be subjected to the “open access” rules.

Another 10MHz will be dedicated to the national public safety network, which will be shared between a commercial operator and public safety agencies.

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