Google Fiber expansion moves fast; San Antonio approves construction(arstechnica.com)
arstechnica.com
Google Fiber expansion moves fast; San Antonio approves construction
http://arstechnica.com/business/2014/03/google-fiber-expansion-moves-fast-san-antonio-approves-construction/
10 comments
Google is really good at generating buzz, and instead of rolling out a plan which would have Google installing fiber in, say, every city over a certain size or everywhere east of the Mississippi, they're saying "we'll do this city, then this one, then this one..."
If the local politicians don't play ball, then there's no Google fiber. That's where the buzz comes in - "Why is Google installing everywhere else but not here?"
It's smart politics on Google's part, particularly since they're probably not willing to sink in enough capital to do more than a few markets a year anyway.
If the local politicians don't play ball, then there's no Google fiber. That's where the buzz comes in - "Why is Google installing everywhere else but not here?"
It's smart politics on Google's part, particularly since they're probably not willing to sink in enough capital to do more than a few markets a year anyway.
Well made point. Combine that with chrissnell's point [1] and it makes even more sense in my mind.
Google Fiber isn't really necessary for the common household, yet. They might be mixing an investment in start-ups with a political agenda. For the latter, if they can push the competition in the rest of the U.S. to even 10% of their offering you'll still have a massive speed increase (and a brand spankin' new infrastructure).
[1] https://news.ycombinator.com/item?id=7397174
Google Fiber isn't really necessary for the common household, yet. They might be mixing an investment in start-ups with a political agenda. For the latter, if they can push the competition in the rest of the U.S. to even 10% of their offering you'll still have a massive speed increase (and a brand spankin' new infrastructure).
[1] https://news.ycombinator.com/item?id=7397174
How do they explain why Google is getting special treatment? It's not like cities have a special, irrational hardon for Google. It's that Google is making a reasonable deal to them. If Time-Warner wants to do the same thing, they can make the same deal.
They don't want to make this kind of deal with cities. They want the government to prevent this kind of deal from being made.
They don't want to make this kind of deal with cities. They want the government to prevent this kind of deal from being made.
Is Google making a reasonable deal? I.e. if they didn't have an advertising business to subsidize this with, would the terms still make business sense?
It's sort of a funny question.
Do roads make economic sense if we didn't have a federal government to subsidize them? Probably not: Texas derives around 58% [1] of its highway costs from vehicle-related fees (e.g. registration, gas tax, etc.) and the rest is subsidized from unrelated sources.
Then again if we did not have a road system, our economy would be in poor shape, because it is harder to get the store to buy things, and to transport the things around. So from that perspective roads are an economic net positive even if they were 100% subsidized from unrelated businesses.
Gigabit internet is similar to roads. It probably can't/won't be funded 100% by the people who use it. At the same time, it is important infrastructure that opens up new avenues for economic opportunity, and I suspect that any major city that had gigabit as available as roads or electricity would find that the benefits exceed the costs, be they subsidized or otherwise.
[1] https://www.icloud.com/iw/#numbers/BAKsWA7R5a0YQGg3ptGBpPlvQ...
Do roads make economic sense if we didn't have a federal government to subsidize them? Probably not: Texas derives around 58% [1] of its highway costs from vehicle-related fees (e.g. registration, gas tax, etc.) and the rest is subsidized from unrelated sources.
Then again if we did not have a road system, our economy would be in poor shape, because it is harder to get the store to buy things, and to transport the things around. So from that perspective roads are an economic net positive even if they were 100% subsidized from unrelated businesses.
Gigabit internet is similar to roads. It probably can't/won't be funded 100% by the people who use it. At the same time, it is important infrastructure that opens up new avenues for economic opportunity, and I suspect that any major city that had gigabit as available as roads or electricity would find that the benefits exceed the costs, be they subsidized or otherwise.
[1] https://www.icloud.com/iw/#numbers/BAKsWA7R5a0YQGg3ptGBpPlvQ...
It's one thing for cities to subsidize infrastructure with tax dollars. Another for a private company to do it as a tie-in to its online services/advertising business. Still another for that company to berate ISPs while doing it, for not building infrastructure they themselves probably wouldn't without the cross-subsidy or synergy from their other businesses.
Generally being a sole infrastructure provider is a very secure investment. This is because you can overcharge until a competitor enters the market and then when competition appears you can undercut them as you no longer need to recoup capital costs while your competitor does. This can stop competitors entering the market as there is not an incentive to do so.
There are a couple of factors that make this a reasonable investment for Google even though they're not the incumbent. The first is the old infrastructure is old enough that it is not capable of offering the same service as the new infrastructure without a significant amount of extra capital investment. Google also can cancel out some of what would be normal capital costs associated with a new entrant because they have related in house skills/services and the clout to bypass some regulatory capture.
This means that the incumbents lose a lot of their advantages as they're playing catch up too and they have to work-in legacy systems. They can't offer the same service on their old infrastructure and have to offer a lower price until they can. To make matters worse they don't want to be too obvious in what they can offer as they could be stung by the state in other places if they act in a way that shows they are consistently abusing their monopoly or acting anti competitively.
It's probably true that Google's investment is set to make money but I'd guess once you factor in opportunity cost it's not the smartest investment. But consider the other advantage they have is that they're not working in a vacuum, improvements in internet usage improves their core business, so even if they get out competed in this market it can help their overall bottom line.
There are a couple of factors that make this a reasonable investment for Google even though they're not the incumbent. The first is the old infrastructure is old enough that it is not capable of offering the same service as the new infrastructure without a significant amount of extra capital investment. Google also can cancel out some of what would be normal capital costs associated with a new entrant because they have related in house skills/services and the clout to bypass some regulatory capture.
This means that the incumbents lose a lot of their advantages as they're playing catch up too and they have to work-in legacy systems. They can't offer the same service on their old infrastructure and have to offer a lower price until they can. To make matters worse they don't want to be too obvious in what they can offer as they could be stung by the state in other places if they act in a way that shows they are consistently abusing their monopoly or acting anti competitively.
It's probably true that Google's investment is set to make money but I'd guess once you factor in opportunity cost it's not the smartest investment. But consider the other advantage they have is that they're not working in a vacuum, improvements in internet usage improves their core business, so even if they get out competed in this market it can help their overall bottom line.
Heh, cable companies are in the advertising business too.
What's funny in the new internet age they're making an even greedier grab to triple dip - charge the content providers, charge the end user, and charge advertising clients.
What's funny in the new internet age they're making an even greedier grab to triple dip - charge the content providers, charge the end user, and charge advertising clients.
Google seems to think so.
http://news.cnet.com/8301-1023_3-57586894-93/google-exec-see...
http://news.cnet.com/8301-1023_3-57586894-93/google-exec-see...
Probably not by itself. However, it looks like Google is doing a very good job on managing the costs in terms of physical disruption, custom hardware, etc. I suspect that they aren't losing much and probably are turning at least a small profit.
However, Google doesn't care. They identified Comcast, Time-Warner, etc. as an existential threat that can get between them and their customers. As such, Google doesn't really care about losing some money as long as it wipes out the monopoly position of the big ISPs.
However, Google doesn't care. They identified Comcast, Time-Warner, etc. as an existential threat that can get between them and their customers. As such, Google doesn't really care about losing some money as long as it wipes out the monopoly position of the big ISPs.
> How do they explain why Google is getting special treatment?
Not exactly special treatment just the benefit of not being an incumbent telco/cable provider. They don't have to face the same regulations (both state/local) and that translates into lower costs to build infrastructure. Google's more likely to get special treatment because they are a very wealthy company. You can bet they are already dreaming up what regulations they will apply to Google once they have sufficient skin in the game. It also acts as a nice bit of leverage against the incumbent telco/cable providers. This is not exactly a bad thing overall. It probably is in the best interest of the tax payers and voters.
It's just ironic to see people cheering this on when it's the same exact strategy of self interest that created cable/telco monopolies. Why should we expect a different result here? I bet you 5-10 years down the road the exclusive rights to operate a 10G-PON FTTH network in San Antonio will be for sale to the highest bidder. Google will have to pay up to remain competitive or exit the market. The incumbent cable or telco provider will buy up the rights. The municipality will have a nice little payday. Rinse & repeat. I don't know why people are cheering.
Not exactly special treatment just the benefit of not being an incumbent telco/cable provider. They don't have to face the same regulations (both state/local) and that translates into lower costs to build infrastructure. Google's more likely to get special treatment because they are a very wealthy company. You can bet they are already dreaming up what regulations they will apply to Google once they have sufficient skin in the game. It also acts as a nice bit of leverage against the incumbent telco/cable providers. This is not exactly a bad thing overall. It probably is in the best interest of the tax payers and voters.
It's just ironic to see people cheering this on when it's the same exact strategy of self interest that created cable/telco monopolies. Why should we expect a different result here? I bet you 5-10 years down the road the exclusive rights to operate a 10G-PON FTTH network in San Antonio will be for sale to the highest bidder. Google will have to pay up to remain competitive or exit the market. The incumbent cable or telco provider will buy up the rights. The municipality will have a nice little payday. Rinse & repeat. I don't know why people are cheering.
Because shoddy, expensive service that's faster is better than shoddy, expensive, and slow service? Come on, that's not even difficult to answer.
Don't forget that Google Fiber in Kansas City offers a free tier (with $300 installation fee).
So if you're insistent on calling both options shoddy, then you've got "shoddy, expensive and slow" versus two options: "shoddy, expensive and fast", or "shoddy, cheap and slow".
So if you're insistent on calling both options shoddy, then you've got "shoddy, expensive and slow" versus two options: "shoddy, expensive and fast", or "shoddy, cheap and slow".
It's probably the case that nobody asked for the particular concessions Google asked for, so it's impossible to say that cities wouldn't have granted them. But it sure looks like Google is getting special deals that probably weren't available to either incumbents or smaller ISPs. I would be interested in hearing the perspective of ISPs that have already tried to deploy fiber.
The only reason Google is getting 'special treatment' is because they've shown that they're willing and able to spend the capital necessary to develop the residential telecom network in North America. The incumbent network operators and ISPs have been dragging their heels on that since the 90s, and since then it's fallen behind other parts of the world.
Google Fibre is good for customers (hence the media buzz) and it's good for municipalities (hence their cooperation). Put the two together, and it looks like Google has a red carpet laid out in front of them simply because they're Google.
But really it's just genuine excitement that someone -- anyone -- is bringing long-overdue upgrades to home internet connections.
Google Fibre is good for customers (hence the media buzz) and it's good for municipalities (hence their cooperation). Put the two together, and it looks like Google has a red carpet laid out in front of them simply because they're Google.
But really it's just genuine excitement that someone -- anyone -- is bringing long-overdue upgrades to home internet connections.
Go, hometown! As someone who grew up in what used to be an incredibly lame and mostly uneducated city, this makes me so happy. San Antonio has come so far. A huge driver behind this is the success of Rackspace and the leadership of it's chairman and co-founder, Graham Weston.
I hope that founders of startups will consider forming their companies in SA. San Antonio has so much going for it: the hometown of one of the world's largest cloud hosting companies, fast Google Fiber coming soon, the booming Pearl district, Geekdom, low cost of living, great weather, awesome food, and so much more. I believe strongly that the future of the tech economy will happen outside of the SFBA and I feel that Google Fiber's bets point strongly to that.
I hope that founders of startups will consider forming their companies in SA. San Antonio has so much going for it: the hometown of one of the world's largest cloud hosting companies, fast Google Fiber coming soon, the booming Pearl district, Geekdom, low cost of living, great weather, awesome food, and so much more. I believe strongly that the future of the tech economy will happen outside of the SFBA and I feel that Google Fiber's bets point strongly to that.
>I hope that founders of startups will consider forming their companies in SA
Which makes me wonder: can businesses use Google Fiber? I was under the impression it's a consumer-only service.
Would they allow servers not for personal usage for startups?
(I really hope more startups appear in cities where many households have Gigabit connections. I can't wait to see what could be done with fast Internet access.)
Which makes me wonder: can businesses use Google Fiber? I was under the impression it's a consumer-only service.
Would they allow servers not for personal usage for startups?
(I really hope more startups appear in cities where many households have Gigabit connections. I can't wait to see what could be done with fast Internet access.)
> I was under the impression it's a consumer-only service.
You're correct:
> We are currently focused on our Fiber-to-the-home network, which is for residential consumers. We hope to be able to offer Fiber to small businesses at some point in the future. To stay updated on any new developments, please follow our blog http://googlefiberblog.blogspot.com/
but that mostly means there's little uptime guarantee, a small business/startup could use GF either eating potential downtime or with a backup stabler line in case fiber goes down.
You're correct:
> We are currently focused on our Fiber-to-the-home network, which is for residential consumers. We hope to be able to offer Fiber to small businesses at some point in the future. To stay updated on any new developments, please follow our blog http://googlefiberblog.blogspot.com/
but that mostly means there's little uptime guarantee, a small business/startup could use GF either eating potential downtime or with a backup stabler line in case fiber goes down.
What I don't understand is why google didn't bid on Time Warner.
With very little effort (compared with rolling out fiber in a couple cities) they could have completed the rollout of DOCSIS 3, and provided everyone with 343/143 Mbps using modems available today (zoom 5341j) and in a couple years when the 24 channel modems become more wide spread upgrade everyone to Gigabit operations.
In ten years will google fiber have cost them more than $45 billion? Will they have 1/10th the penetration that TW has today?
With very little effort (compared with rolling out fiber in a couple cities) they could have completed the rollout of DOCSIS 3, and provided everyone with 343/143 Mbps using modems available today (zoom 5341j) and in a couple years when the 24 channel modems become more wide spread upgrade everyone to Gigabit operations.
In ten years will google fiber have cost them more than $45 billion? Will they have 1/10th the penetration that TW has today?
Speculative, but culture?
Look at how the Motorola acquisition played out. Motorola was a company that had a pretty damn good (maybe just a bit heavy) engineering culture.
If you buy out a culturally bankrupt company infested with assholes, you have to root out all those assholes while simultaneously continuing operations and developing the future. I dare say this would be much harder than a new build out.
Look at how the Motorola acquisition played out. Motorola was a company that had a pretty damn good (maybe just a bit heavy) engineering culture.
If you buy out a culturally bankrupt company infested with assholes, you have to root out all those assholes while simultaneously continuing operations and developing the future. I dare say this would be much harder than a new build out.
Also speculative, but Google probably has a set of equipments that don't work well with others.
When you play in the access and transport space, there usually a set of standard that you have to follow, in order for it to work together with others.
If Google owns the entire infrastructure, they can build their own equipments that are a lot simpler/cheaper to build, because they don't have to deal with all the standard-crap that other manufacturers have to deal with.
If they bought TWC, then they need to integrate all those devices, including all of the OSSes that are guarded by bureaucrats.
If Google owns the entire infrastructure, they can build their own equipments that are a lot simpler/cheaper to build, because they don't have to deal with all the standard-crap that other manufacturers have to deal with.
If they bought TWC, then they need to integrate all those devices, including all of the OSSes that are guarded by bureaucrats.
Yeah, they probably learned that the hard way from their DoubleClick acquisition.
I wouldn't buy Time Warner Cable for $45 billion solely on the fact that they're in a declining business (traditional cable tv) that is likely to lose millions of subscribers over the next decade (so I'm paying 23 times earnings for the NY Times in 2003 basically). I also wouldn't buy them for $45 billion because they're carrying a massively borked balance sheet, at $23b in long term debt and -$22.3b in net tangibles. The true cost of buying them is a lot higher than $45 billion.
I work for a company that was cobbled together from a bunch of smaller companies. It's a huge pain in the ass. Different technologies, different billing systems, different corporate cultures... you'd have to get an absolute fire sale price to make that worthwhile.
I'd like to see government step up in their bureaucratic process more. I am not saying we should approve everything at the speed of light.
I feel bad when I read this article yesterday: http://cityroom.blogs.nytimes.com/2014/03/11/in-9-years-of-w...
Only 3 public toilets go live in nine years. I hope we can break ISP franchise and monopoly too so I don't have to move a few blocks down just to get another ISP.
I feel bad when I read this article yesterday: http://cityroom.blogs.nytimes.com/2014/03/11/in-9-years-of-w...
Only 3 public toilets go live in nine years. I hope we can break ISP franchise and monopoly too so I don't have to move a few blocks down just to get another ISP.
The reason why the customer service at most ISPs sucks is because arbitrary rules are imposed on them by local governments. For example, if the average call can't be over 9 minutes long, don't expect help with a problem that takes half an hour to diagnose. If the same rules aren't being imposed on Google, then there's a problem.
I thought they just wouldn't go over 9 minutes due to internal rules (e.g., you'll get written up if your average call time goes over a certain level). Do you have a source for the "local governments" claim? I'd be very interested at yelling at my city council for imposing stupid rules like that.
(My main source for this goes back to Joel's article on Measurement[1].)
[1] http://www.joelonsoftware.com/news/20020715.html
(My main source for this goes back to Joel's article on Measurement[1].)
[1] http://www.joelonsoftware.com/news/20020715.html
What's the context to that 9 minute example?
Google Fiber is taking over and people will choose it over their regular ISPs because it's better. And soon enough it won't matter what OS your mobile device is running. For as long as you're connecting via Google Fiber, Google has your data.
I was a user of Google WiFi in Mountain View, and indeed the terms of service (which no one reads) allowed Google to collect information by watching what you did on the Internet. No PII, of course, but we all know that metadata is enough to identify people.
I solved this problem with a VPN, just like you need with AT&T or Comcast.
I solved this problem with a VPN, just like you need with AT&T or Comcast.
No they don't. Maybe you were confused by "We may record information about your usage of Google WiFi, such as when and for how long you use the network and the frequency and size of data transfers"?
https://wifi.google.com/privacy_and_security.html
https://wifi.google.com/privacy_and_security.html
I have no idea if the current document was the one I read last decade. At the time, I was alarmed enough to use a VPN.
(edit: archive.org says this page dates way back to 2012. Presumably it used to be elsewhere...)
(edit: archive.org says this page dates way back to 2012. Presumably it used to be elsewhere...)
So is Google actually planning on running new aerial fiber themselves or are they just using existing fiber that terminates to city buildings?
They run new aerial fiber. They're asking for the right of way on the poles.
As a San Antonio resident paying out the ass for AT&Ts 40Mbps tier, all I have to add to the conversation is this: fuck yes.
YES!! When can I give you my money.
Yes please. Start putting fiber in Leawood Kansas already.
I think it's a good example of how one can bring attention to the senseless bureaucracy we all complain about. Instead of complaining, bring about actionable steps.