Verizon Wireless, a joint venture between Verizon Communications Inc. (NYSE: VZ) and Vodafone Group Plc (ADR) (NYSE: VOD), announced today that it would be providing open access to its network in the near future. In short, customers will be given the option to use, on its nationwide wireless network, wireless devices, software and applications not offered by the company.

This is interesting stuff and the refashioning of a common practice for network operators to bundle a sale of a phone together with network connectivity. Now, consumers can decouple their cellular purchases and use whatever phones suit them.

The Wall Street Journal article discussing the Verizon announcement explained that "in the short term, the impact of the shift may be limited. Some analysts expect Verizon to charge customers using an outside phone more for its cell phone service. At the same time, because Verizon -- like other cell phone companies -- subsidizes the cost of phones, few consumers may want to spend the hundreds of dollars necessary to buy a phone independently of a carrier."

As Doug mentioned this morning, EchoStar (NASDAQ: DISH) has purchased SlingBox for $380 million in its quest to gain some kind of interactivity with its customers. You see, although EchoStar's DISH Network is popular along with DirecTV as standalone satellite services, cable and telecom companies are pushing harder than ever into two-way services meant to hook customers to more and more product offerings.

But outside of the SlingBox acquisition, EchoStar looks to be spinning off non-core assets at the same time. The company is reportedly looking at spinning off its non-Pay TV services into a different company. Along with the "view anywhere" technology it will gain from the SlingBox purchase, does EchoStar foresee large changes coming to its industry? Some would say yes, or that it is just implementing some type of preventative maintenance to remain competitive.

At the same time it would be rolling out cool services like SlingBox to its customers, the company would spin off the division of EchoStar responsible for set-top boxes, manufacturing, and its satellite centers into a new publicly traded company. Oddly, the SlingBox product line would remain with the core company, even though it is a "set-top box" of sorts. The reason? EchoStar Chief Charlie Ergen says that separating the consumer and wholesale businesses would unlock shareholder value, and the SlingBox product is most definitely a consumer product. Ergen also stated that he would serve as CEO of both companies.

The last question is this: what is DirecTV doing? It's had problems rolling out HDTV channels through its satellite network so far, so it could be the one left floundering here if EchoStar's position as two separate companies with a hot-company acquisition all goes through soon.

MOST NOTEWORTHY: Commercial Metals (CMC), KKR Financial (KFN), Career Education (CECO), Ann Taylor (ANN) and Intel (INTC) were today's noteworthy upgrades:

• CIBC upgraded Commercial Metals (NYSE: CMC) to Sector Outperformer from Sector Performer based on valuation.

• KKR Financial (NYSE: KFN) was raised to Outperform from Market Perform at Friedman Billings, following managements detailed conference call and managements prudent and rapid actions to address the sale of its Rambus (RMBS) portfolio.

• Bear Stearns upgraded Career Education (NASDAQ: CECO) to Outperform from Peer Perform based on valuation.

• Ann Taylor (NYSE: ANN) was upgraded to Outperform from Market Perform at Piper Jaffray due to the upside at the company's LOFT division and the firm's belief that there is upside to their 2008/2009 estimates for Ann Taylor.

• Credit Suisse upgraded shares of Intel (NASDAQ: INTC) to Outperform from Underperform based on expected margin expansion, a more benign competitive environment in the MPU sector, better positioning vs. AMD (AMD) at the high-end, and strong demand trends...

OTHER UPGRADES:

• Citigroup upgraded Sovereign Bancorp (NYSE: SOV) to Buy from Hold.

• Network Appliances (NASDAQ: NTAP) was upgraded to Buy from Neutral at Merrill Lynch and Caris raised shares to Buy from Above Average.

• JP Morgan added Continental (NYSE: CAL) to its Focus List. Punk upgraded Washington Mutual (WM) to Buy from Market Perform.

Analyst summaries provided by TheFlyOnTheWall.com (subscription required).

The FCC's upcoming auction for the 700-Mhz radio spectrum could give Google (NASDAQ: GOOG) and other tech giants the power to change the world of wireless technology.

The current draft rules would set aside space in the new spectrum for an "open" network, void of the current restraints telecom operators like AT&T (NYSE: T) and Verizon Communications (NYSE: VZ) normally put on their networks. The space for sale would be large enough to create a nationwide network "that will open the door to a lot of innovative services for consumers," FCC chairman Kevin Martin told USA Today. Estimates suggest that the auction could yield $20 billion to $30 billion for the government.

The point of an "open" platform is to allow consumers to use any combination of devices, software, content or services on the new network. The proposal for an open network would be a huge setback for the likes of AT&T and Verizon, among other major telecoms, because they wouldn't be able to control what phones and services would be used in their networks. Carriers have been critical of the draft rules which they feel favor Google, while consumer advocates complain that the rules are too timid and fail to create actual competition for the market, according to The Wall Street Journal.

Google, along with Yahoo! (NASDAQ: YHOO), eBay (NASDAQ: EBAY), Intel (NASDAQ: INTC), EchoStar (NASDAQ: DISH) and DirecTV (NYSE: DTV) are part of the "Coalition for 4G in America," a group that has repeatedly called for the new bandwidth to be open to all devices and software. The Journal also said that Google and other tech giants have gone a step further to argue that the FCC should explicitly designate the new owner of the bandwidth to open up its network to a wider group of applications and mobile devices, unlike the existing system.

The FCC is expected to make a final decision on the draft rules over the summer.

Note: The Daily Option Update is provided by Stock Options Specialist Paul Foster of theflyonthewall.com.

Volatility Index S&P 500 Options-VIX down .37 to 9.97.

Qualcomm Inc. (NASDAQ:QCOM) option implied volatility is low as suggesting reduced Risk

Qualcomm is recently up $1.83 to $39.90. Traders are adjusting their positions on Qualcomm managements litigation/negotiations with Nokia Corp. (NYSE:NOK) and trends for CDMA/3G heading into 2007. American Technology Research reiterated its Buy rating on QCOM this morning. QCOM call option volume of 71,230 contracts compares to put volume of 27,416 contracts. QCOM April option implied volatility of 32 is below its 26-week average of 35 according to Track Data, suggesting non-directional risks.

Network Appliance Corp. (NASDAQ:NTAP) Feb options indicate risk into EPS, March suggests less risk

Network Appliance, a provider unified storage solutions, is expected to report EPS of $0.28 after the close tonight. Morgan Keegan has an Outperform rating on Network Appliance. NTAP February 37.5 straddle is priced at $2.05, above its theoretical value of $1.08. NTAP March option implied volatility is at 30, below its 26-week average of 37 according to Track Data, suggesting decreasing price risks.

Option volume leaders today were: U.S. Steel Corp. (NYSE: X), Apple Inc. (NASDAQ:AAPL), Ford Motor Corp. (NYSE: F), Alcoa Inc. (NYSE: AA), Garmin Ltd. (NASDAQ-GRMN) and Google Inc. (NASDAQ: GOOG).