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The Mere Promise of Google Fiber Sends Rivals Scrambling 258

Hugh Pickens DOT Com (2995471) writes "Marguerite Reardon writes at Cnet that within a week of Google's declaration last spring that it planned to build a fiber network in the city of Austin, AT&T announced its own Austin fiber network and in less than a year's time, AT&T and local cable operator Grande Communications have beaten Google to market with their own ultra-high speed services using newly built fiber networks. AT&T maintains it has been planning this fiber upgrade for a long time, and that Google's announcement didn't affect the timing of its network but Rondella Hawkins, the telecommunications and regulatory affairs officer for the city of Austin, said she had never heard about AT&T's plans before Google's news came out. Hawkins was part of the original committee that put together Austin's application to become the first Google Fiber city. 'Our application for Google would have been a good tip-off to the incumbents that we were eager as a community to get fiber built,' says Hawkins. 'But we never heard from them. Until Google announced that it was going to deploy a fiber network in Austin, I was unaware of AT&T's plans to roll out gigabit fiber to the home.' Grande Communications' CEO Matt Murphy admits that without Google in the market, his company wouldn't have moved so aggressively on offering gigabit speeds. It also wouldn't be offering its service at the modest price of $65 a month, considering that the average broadband download speed sold in the US is between 20Mbps and 25Mbps for about $45 to $50 a month.

It's not surprising, then, that in every city in AT&T's 22-state footprint where Google is considering deploying fiber, AT&T also plans to bring GigaPower. That's a total of 14 markets, including Austin, the Triangle region of North Carolina, and Atlanta, home to AT&T's mobility division. While AT&T refuses to acknowledge that its gigabit fiber plans are answering the competitive challenge posed by Google Fiber, others say that Kansas City may have been a wake-up call. 'I think all the providers have learned some valuable lessons from Google's Kansas City deployment,' says Julie Huls, president and CEO of the Austin Technology Council. 'What Google did instead was say, "We're going to build you a Lamborghini, but price it at the same price as a Camry,"' says Blair Levin. 'And that's what's so disruptive about it.'"
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The Mere Promise of Google Fiber Sends Rivals Scrambling

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  • Competition (Score:2, Informative)

    by Anonymous Coward on Friday May 09, 2014 @08:23AM (#46957961)

    Oh, you mean competition is a good thing and monopolies are bad?

    ISPs in the US don't seem to have *real* competition in the majority of locations. It's amazing what happens when *real* competition comes to the market.

  • by sjbe ( 173966 ) on Friday May 09, 2014 @10:35AM (#46959143)

    Google doesn't necessarily care who provides the fast internet service to it's online customers.

    Yes the do because the ISP who controls the connection to the end users can seriously mess with Google's business. Think about why Google developed Android. Google is an advertising company but if they can't control or influence the devices that actually touch the people they are trying to advertise to then handset makers and telecoms can shut them out or at least badly hurt Google's margins in exchange for access to eyeballs. And it wasn't just the ISPs either. Apple, Microsoft/Nokia and others could have basically refused to carry Google advertising and/or substituted their own. Same problem with ISPs to homes. It's potentially an existential threat to Google unless Google can find ways to make the ISPs play nice.

    I think Google is rolling out some fiber networks in a few areas to provide a credible threat to AT&T, Verizon and Comcast to hopefully force them to behave. Sort of a doomsday weapon which they hope to never need to use. Google is one of the few companies that has the cash to seriously consider rolling out their own network if they were forced to. In fact I could even see them conceivably partnering with Apple and Microsoft on this if the need arose. This would hurt Google's margins rather badly (running an ISP is expensive) but it is an option.

  • Re:Competition (Score:5, Informative)

    by Richy_T ( 111409 ) on Friday May 09, 2014 @11:08AM (#46959465) Homepage

    It's also amazing how people choose to live far from infrastructure and then cry when stuff isn't handed to them on a plate. I'm not a huge fan of big cities but I understand that by choosing not to live in one, I'm giving up on some things. If I lived halfway up a mountain, I wouldn't be expecting anyone to beat a path to my door with gigabit broadband either.

  • Re:Competition (Score:5, Informative)

    by unitron ( 5733 ) on Friday May 09, 2014 @11:18AM (#46959581) Homepage Journal

    No, they had billions of government dollars to do it a decade ago, and didn't. Just took the money and pocketed it.

    I see this point repeated everywhere on various blogs, forums, and especially slashdot. And yet I have never seen any source for this information, reputable or not. I couldn't come up with a google search termto generate anything relevent.

    Is there a source on this bold claim? It seems reasonable that it could be true, but I am a lot more skeptical than I used to be.

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