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Why Google Fiber Is High-Speed Internet's Most Successful Failure
Blair Levin and Larry Downes report via Harvard Business Review: In 2010, Google rocked the $60 billion broadband industry by announcing plans to deploy fiber-based home internet service, offering connections up to a gigabit per second -- 100 times faster than average speeds at the time. Google Fiber, as the effort was named, entered the access market intending to prove the business case for ultra-high-speed internet. After deploying to six metro areas in six years, however, company management announced in late 2016 that it was "pausing" future deployments. In the Big Bang Disruption model, where innovations take off suddenly when markets are ready for them, Google Fiber could be seen as a failed early market experiment in gigabit internet access. But what if the company's goal was never to unleash the disrupter itself so much as to encourage incumbent broadband providers to do so, helping Google's expansion in adjacent markets such as video and emerging markets including smart homes?
Seen through that lens, Google Fiber succeeded wildly. It stimulated the incumbents to accelerate their own infrastructure investments by several years. New applications and new industries emerged, including virtual reality and the Internet of Things, proving the viability of an "if you build it, they will come" strategy for gigabit services. And in the process, local governments were mobilized to rethink restrictive and inefficient approaches to overseeing network installations. The story of Google Fiber provides valuable lessons for future network transformations, notably the on-going global race to deploy next-generation 5G mobile networks. It seems, then, a good time to review the story of how the effort came into being, what it achieved, and what it teaches investors, consumers, and community leaders eager to ensure continued private spending on internet infrastructure.
Seen through that lens, Google Fiber succeeded wildly. It stimulated the incumbents to accelerate their own infrastructure investments by several years. New applications and new industries emerged, including virtual reality and the Internet of Things, proving the viability of an "if you build it, they will come" strategy for gigabit services. And in the process, local governments were mobilized to rethink restrictive and inefficient approaches to overseeing network installations. The story of Google Fiber provides valuable lessons for future network transformations, notably the on-going global race to deploy next-generation 5G mobile networks. It seems, then, a good time to review the story of how the effort came into being, what it achieved, and what it teaches investors, consumers, and community leaders eager to ensure continued private spending on internet infrastructure.
People forgot that the main reason Google Fiber failed was because immediate legislation passed basically everywhere, as local fiber networks not owned by communications companies became illegal. The reason it is a $60 billion dollar industry is because they will do anything not to chew into their profit margins. There's a reason that 3 of the top 5 companies that top lobbying expenditures are in that business.
Google Fiber, Project Fi - I've always looked at things like these as basically Google telling the telcos that, if they really had to, they could compete directly against them.
A problem for Google (exacerbated with the end of net neutrality) is that the telcos etc. who have the "last mile" to the actual people that Google depends on to survive, could choke off Google's air (this is the same reason why Google decided they needed their own mobile OS and bought Android and causing a break with their previously-happy relationship with Apple).
It's a matter of survival for Google that, if they had to, if all the telcos suddenly imposed fees on Google/advertisers since, hey, "you're making money off OUR customers", they could pour some of the money they have into making Google Fiber, Fi a full-blown competitor, as opposed to a "project".
It's a signal to the telcos "I could kill you if you make me need to, so let's just carry on with the status quo shall we?". Their very existence and the visible ability to scale up if they have to, is all Google really wants - all other benefits (improving internet access overall etc.) are bonuses.
and I've posted this on Slashdot before, but I'll post it again.
This article is spot on.
Before Google Fiber came to town, getting and using broadband in this area was painful. It was the "telephone company utility" model. Everything had to be done by phone, with tons of time on hold. Installation was workmen with a clipboard, scheduled weeks out. You'd get 5mbps for $$ or 10mbps for $$$ or 50mbps for $$$$, no higher tier than 50mbps without paying for "business service" at the level of $500-$1k monthly. And those were your choices from every carrier. You never reached more than 25-40% of advertised speed up or down. Service was terrible and unreliable and if there was an outage you could be offline for weeks waiting for a service appointment. Account changes or cancellations were a by-telephone nightmare that were virtually destined to go wrong each time. And technical questions about configuration, blocked ports, etc.? Good luck. It was all a black box to the customer service lines. Far easier to figure such things out empirically yourself.
Then, Google Fiber came to down. Installations scheduled online. Accounts administered online, everything from payment to plan selection and changes. Transparency in equipment and documentation. And either 5mbps for FREE, 100mbps for $ or 1gb for $$, what had previously been the 5 or 10mbps cost with other carriers. Installations done in just days, rather than weeks out, by friendly people in branded vans. You get 100% of advertised speed, 24 hours a day, sustained. Outages are virtually unheard of, but if a tree does come down and knock out a line, it's fixed in a couple hours, not weeks. A walk-in Google Fiber store where you can actually talk tech details and they understand everything you're saying. It was like we jumped from 1995 to the present in a single month.
And within weeks, every other carrier had boosted their minimum residential offering to 50mbps and were suddenly offering and deploying gigabit residential fast as they possibly could, at (interestingly enough) exactly the same price as Google. Service improved drastically and they suddenly started to talk tech in their ads.
It does basically feel like Google was tired of seeing their growth limited by a bunch of small timers trying to pick the pockets of the public, so they came in and said "OYA? We're Google. FU." and got everyone gigabit. And for the other carriers it became a case of "either play fair or get fucked." So they played fair and then Google was happy to back off. If they hadn't, I wonder if Google would have continued and just put them all out of business. My impression is that Google doesn't necessarily want to be in the broadband business, but that they want to make damn sure the public has access to legitimate contemporary "broadband" pipes.
I understand that Google has an interest in this, but I don't mind at all. I'm happy to let Google profit if I get rock-solid up/down gigabit fiber with online administration for what was previously the cost of flaky 10 megabit down/768k up copper administered by an idiot bureaucracy behind a 2 hour telephone wait.
STOP . AMERICA . NOW
As much as I want to champion Google's efforts here, I feel like TFA is just trying to find a way to spin a failure as a success. Which is understandable, as that's a very human thing to do.
None the less, Google Fiber was absolutely a failure. Google threw down a ton of money on infrastructure they either never completed (Portland), or they completed systems and will probably never make back their initial investment (Kansas City). With Google's massive bank account it wasn't quite a boondoggle, but it none the less cost the company a lot of money.
And the reason it failed is because the company in turn failed to take into account where the wireless market would be 5 years down the line after they started. Starting in 2012 the big 4 wireless carriers hit the ground running on LTE, and hard. The end result is that while LTE offers a fraction of the performance of a good coaxial cable or fiber system, it covers something like 98% of the US population. It's everywhere, and in most places it's even kind of, sort of okay. And with everyone owning a cell phone anyhow, we're now seeing some cord cutters cut the hardline entirely and work entirely off of wireless. All of which has obliterated the critical mass of consumers required to fund a major new infrastructure build-out.
I admire Google's intentions, and I really wish I had some fiber myself. But they started building a fiber network right when consumers started switching to wireless. So it was just a good old fashioned failure: they built something that not enough people wanted.
New applications and new industries emerged, including virtual reality and the Internet of Things, proving the viability of an "if you build it, they will come" strategy for gigabit services.
What in the world did gigabit internet have to do with IoT or VR? The only thing gigabit did for IoT was allow massive DDoS of never before seen sizes when someone connected their unpatched refrigerator or lightbulb.
I'm typing on my Google Fiber in Huntsville, Alabama. Rather than let Google Fiber be just another company digging up people's yards and running another privately-owned infrastructure, the local city-owned utility company is building out the fiber plant to the curb (useful to them to allow smart metering and such). Google Fiber then just runs from the curb to the house. The infrastructure is open access; any company that wants to build into the fiber huts is able (and there are other companies getting into the game).
This is the perfect model IMHO; I don't really want my government running the Internet access, but I also don't want 27 different companies digging up my yard to run their fiber/wire down the street. The city-owned utility will deliver fiber past every address in town, so Google Fiber will be available to everyone, not just pockets here and there. And if they don't succeed/stick around, the hardest part of building a competitor (the last mile) will be done, so others can come in and compete with much lower start-up costs.