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GOOGLE FIBER
If you live in Kansas City, MO or Kansas City, KS, you might soon get first-world Internet service courtesy of Google Fiber.
As of April 2012, almost two-thirds (66%) of American adults could access some form of broadband connection from their home, whether via DSL, cable or fiber line or via a wireless service. However, about a quarter of local Kansas City residents have no broadband access from home.
The Google network will deliver symmetric (i.e., two-way) 1 Gigabit per second (Gbps) connectivity to households across the city as well as to schools, libraries and hospitals. The 1 Gbps data rate is about 20 times faster than most current residential broadband services operating across the country. According to Google, the first homes will come online by the end of 2013.
According to Akami, the average download speed in the U.S. during Q4-2011 was 5.8 Mbps; Boston had the fastest U.S. download rate of 8.4 Mbps. However, these rates pale compared to South Korea and Japan with average speeds of 17.5 Mbps and 9.1 Mbps, respectively.
Google is offering a novel build-out and sign-up plan. Residential customers are being asked to pay a $300 fee to cover the construction costs to connect their home to the fiber network. For this, they can access a free basic broadband service with “conventional” speeds up to 5 Mbps downstream and 1 Mbps upstream for the next seven years.
In addition to paying the $300 installation fee, subscribers can choose between two pricing plans to access the 1-Gig network. For $70 a month, subscribers get 1-Gig high-speed Internet service; in comparison, Verizon’s FiOS service, offers 300 Mbps downstream with 65 Mbps upstream for $205 for a month.
For $120 per month, Google subscribers will get broadband Internet and Google’s TV service along with DVR functions, 1 terabyte of cloud data storage and an Android Nexus 7 tablet which functions as a TV remote. The Google set-top box will have built-in WiFi access for the TV set and other devices. The company insists that there will be no monthly data caps or overage charges.
Google’s TV service will support what is known as “over the top” (OTT) TV offering YouTube and Netflix as well as on-demand movies and TV shows. As of now, given Google’s undeclared war with the cable and phone companies, it won’t offer such popular channels as including CNN, ESPN and AMC.
Google’s principle broadband service competitor in the Kansas area, Time Warner Cable, offers a 50 Mbps service for an introductory price of $80 a month. Its “triple play” package with TV, Internet and home phone service is priced about $200 a month.
The leading telcos, AT&T and Verizon, have abandoned their much-hyped plans to build out high-speed fiber networks. Verizon, after reaching about 14 percent of the nation with its fiber-to-the-home FiOS service, ended deployment efforts in 2010. AT&T, after reaching only about half of its customer base with its U-Verse fiber-to-the-neighborhood service, stopped building it out at the end of 2011.
For comparison, Hong Kong broadband subscribers to a comparable 1-Gbps network pay one $48.89 per month; in Chattanooga, TN, they pay $317.03 per month.
It’s hard to get real cost data on building out a high-capacity fiber optic broadband network. Google has not released the costs for building its Kansan cities fiber networks. It has been reported that Verizon spent $23 billion to build its FiOS network. An industry rule-of-thumb estimates the costs for a citywide, let alone nationwide, fiber network at $1,000 to $2,000 per home. So, reaching 100,000 homes will run about $150 million. Google’s got big plans and deep pockets, but reaching a million or more households requires real money.
Google expects to turn the digital spigot on for its Kansas cities’ networks at the end of next year. However successful the venture might be or whether Google expands into other localities is less important than the challenge it poses to the telcos and their failed efforts to build Al Gore’s once fabled Information Superhighway.
Akami ranks the U.S. 13th in terms of download data speed. This is not only behind such super-fast countries like South Korea and Japan, but Latvia and Romania as well. Who knows, really high-performing broadband might lead a lot of Silicon Valley and Silicon Alley digital hipsters to relocate to the Midwest.
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David Rosen is a writer and business-development consultant. He is author of the indie classic Off-Hollywood: The Making & Marketing of Independent Films (Grove), originally commissioned by the Sundance Institute and the Independent Feature Project. He can be reached at drosennyc@verizon.net. For more information, check out www.DavidRosenWrites.com and www.DavidRosenConsultants.com.
