The free ride is over for new Google Fiber subscribers in Kansas, as Google drops the free “Basic Internet” option from its plans.
Google has offered the free plan since Fiber first launched in July 2012. Compared to Google’s $70 per month Gigabit Internet offering, the free plan was considerably slower, with just 5 Mbps download speeds and 1 Mbps upload speeds. It also required a hefty $300 construction fee, which Google waived for paying customers who signed on for at least a year of service.
According to Recode, that plan is now going away for new subscribers, suggesting that existing customers can hang onto their service for now. Google still offers free Basic Internet plans in Austin, Texas, and Provo, Utah, and is collaborating with the U.S. government on free broadband connections for public housing residents.
The news isn’t all bad for Kansas residents. In place of the free plan, Google is now offering a “Fiber 100” option for $50 per month, with 100 Mbps upload and download speeds. And just like Google’s 1 Gbps plan, there’s no installation fee for subscribers who sign a one-year contract. Google employs a similar pricing scheme in Atlanta, where Fiber service went live in February, so it’s safe to assume the free option won’t be coming back as Google Fiber expands.
Beyond Kansas, Austin, Provo, and Atlanta, Google plans to bring Fiber service to San Francisco, Salt Lake City, San Antonio, Nashville, Huntsville, Charlotte, and Raleigh-Durham. Down the road, Google is eying 11 more cities for potential expansion, including Chicago, Irvine, Jacksonville, Los Angeles, Louisville, Oklahoma City, Phoenix, Portland, San Diego, San Jose, and Tampa.
Why this matters: On the business side, Recode notes that Fiber is the most expensive initiative for Google parent company Alphabet, with this year’s expansion costing between $1 billion and $2 billion according to unofficial estimates. As Alphabet looks to turn its many experiments into sustainable businesses, nixing Fiber’s free offering could be one way to tighten the belt.
Replacing the free plan with a more compelling paid option also makes sense from a product perspective. Basic Internet’s 5 Mbps download speeds are barely enough for a single video stream, but 1 Gbps is excessive for most of today’s web services. A 100 Mbps option for $20 per month less than Gigabit could hit the sweet spot for most users, allowing Fiber to better-compete with cable giants like Comcast and Time Warner Cable.