Google Fiber divides users into the haves and have nots
Every day is a beautiful day in the fiberhood, unless blazing fast Internet speeds haven't come to your town yet.
The chosen ones in Kanas City, Austin, and Provo are getting Internet connections that are 100 times faster than average at very low prices, thanks to Google's Fiber project.
Unfortunately, you and I don't live there. So we're stuck in a bandwidth backwater.
As Internet trolls like to say: U mad, bro?
If you don't live in one of these cities, you should be mad. Google's Fiber project demonstrates that very high Internet speeds are possible and nobody except Google has the vision or courage to make it happen.
One Internet bandwidth provider has admitted the ability to provide much faster speeds to consumers, but has decided not to. Time Warner Cable CFO Irene Esteves said in February that Time Warner is perfectly capable of "delivering 1 gigabit, 10 gigabit-per-second" Internet connectivity to consumers, but that the company just doesn't "see the need of delivering that to consumers." I believe Esteves' statement accurately represents the thinking of most existing Internet providers.
Now are you mad?
The issue isn't really that consumers don't want faster Internet speeds. And it's not that cable providers don't care.
It's really a chicken-and-egg problem.
Why your Internet is so slow
Average U.S. Internet speeds rank 12th or 13th in the world, which is pathetic for the country that invented the Internet and contains Silicon Valley, Hollywood, and data-hungry Wall Street and a $15 trillion annual GDP.
Other countries are pulling away. A Sony-backed service recently announced 2Gbps download speeds in Tokyo for $51 per month—twice the speed of Google Fiber and 200 times faster than the U.S. average and at a lower price than Google Fiber.
Now are you mad?
Gigabit fiber Internet access is affordable, but only if everybody gets it. But everybody isn't going to get it unless it's affordable.
And that's why we can't have nice things.
At least, that's what Esteves really means when she says that users don't want faster speeds. Providing consumers with the faster speeds Time Warner currently provides to some business customers is very expensive because only a few customers pay for it all.
It's not that Time Warner Cable's customers don't want fast Internet. They don't want Time Warner Cable's price for fast Internet.
However, if you lay fiber to every home in a city, and if a majority of homes sign up to use it, the cost can come way down. And that's what Google Fiber is all about. It's about making a bet on the future and investing heavily to bootstrap widespread use and high demand.
What you need to know about Google Fiber
Google's Fiber project involves the actual digging of trenches and the actual laying of fiber optic cables all the way to homes. There are innumerable logistical and legal hurdles to overcome for each city.
Google is already providing the service in Kansas City, and is still expanding into new neighborhoods there. The company recently announced that it would roll it out to Austin, Texas, then Provo, Utah.
Google offers consumers three "plans." The first is Internet comparable in speed to ordinary broadband, and it's free. The second is 1Gbps speeds and 1TB of Google Drive space for $70 per month. The third adds TV plus a 2TB DVR box for a total of $120 per month.
Getting Google Fiber service is just like getting cable Internet service (except 100 times faster). You get a Wi-Fi capable router, and you plug your PC into it via Ethernet for the full-speed experience.
Google is spending $84 million to build the infrastructure necessary to serve 149,000 Kansas City customers. That's $563.75 per customer, for you math majors. (If that sounds like a lot of money, consider that the infrastructure gives you 100 times faster Internet for the rest of your life for the price of an iPad. Still, customers don't have to pay for it up front—Google is doing that.) And it gets cheaper per customer with each new person that signs up.
Goldman Sachs estimates that it would cost $140 billion to deploy Google Fiber nationwide.
To put that in perspective, that one-time investment would give entrepreneurs in every state of the union a radical advantage globally, ignite an economic boom comparable to the nationwide deployment of electricity 100 years ago and enable incredible new services—all for less than what the U.S. loses each year in offshore tax havens.
Now are you mad?
Mad users are the best part of Google Fiber
It's unlikely that Google will lay fiber to every city in the U.S., and less likely still that Google will do that internationally. And it doesn't need to.
Google Fiber is already "inspiring" ISPs to boost speeds and investment. Google may be triggering an arms race for high-speed Internet connectivity, because it's re-setting expectations about how fast the Internet should be.
This increasingly matters as HD movies and TV becomes more mainstream. Right now, Netflix alone consumes one-third of all the download bandwidth in the U.S. at peak times.
Hollywood and other movies-on-demand services had better get busy offering compelling services. More than half the upload bandwidth in the U.S. is consumed by BitTorrent.
I think the minority of providers who figure out how to offer vastly higher speeds at very low cost will survive, and the Time Warners will get out of the ISP business for good.
No, AT&T didn't announce gigabit fiber in Austin
Hours after Google announced that Austin would get the Google Fiber treatment, AT&T (which is headquartered in Dallas) announced that it would build a gigabit fiber network of its own in Austin.
Or, at least that's what the news reports would have you believe. But if you look at the press release, it was really a passive-aggressive bit of whining about Google getting special treatment from Austin authorities.
Instead of announcing a plan to build fiber optic connectivity in Austin, AT&T actually announced that "it is prepared to build an advanced fiber optic infrastructure in Austin," according to the announcement press release.
"Prepared to build" does not mean "plans to build."
Then the whining began: AT&T's plans "anticipate it will be granted the same terms and conditions as Google on issues such as geographic scope of offerings, rights of way, permitting, state licenses, and any investment incentives."
The release ended with this zinger: "Our potential capital investment will depend on the extent we can reach satisfactory agreements."
In other words, the whole reason for AT&T's press release was not to announce the intention to build fiber optic gigabit Internet connectivity, but instead to complain about preferential treatment of Google by local authorities.
AT&T has a point. Local, state, and government regulations and restrictions are a big part of why our Internet speeds are so slow. And that's yet another reason why Google Fiber is so brilliant.
Google is simply smarter than AT&T
Rather than approaching individual cities and begging them for permission to lay fiber, Google held a big contest and said, in effect: "OK, we're going to pick a city to gain a massive economic boost. You want it? What are you going to do for us?"
Then they started choosing from among the 1100 applicant cities based on which ones were most serious about making Google Fiber possible.
In fact, Google Fiber triggered a gold rush of entrepreneurial investment and activity.
One enterprising local even rents their Google Fiber-connected home at a premium on AirBnB, and calls it " Hacker House."
Google Fiber is creating a lot of hype and attention. It's making people realize that affordable, ultra high-speed Internet connectivity is possible.
It's making people look at their local governments and ISPs and ask: Why can't I have this?
But mostly, Google Fiber is making people mad. And that's the right emotion in the face of the incredible waste of time and money and opportunity that takes place every day that goes by while we're held back by yesterday's Internet speeds.
But let's not just get mad. Let's get fiber.