Google Fiber Plans for Impact

By Stephanie Blanchard, Digital Editor — June 03, 2013

With mountains to the East, and a large lake to the West, Provo, UT, is 45 miles south of the state’s capital. Home of Brigham Young University, the rural region attracts visitors not only for its private university but for the area’s world famous trout fishing, and close proximity to the Sundance Resort film festival.

Google Fiber was probably not considering any of those things when it agreed to purchase Provo’s existing fiber-optic network, iProvo, to make it the third city on its super-fast network. This follows deployments in Kansas City, KS (including Kansas City, MO) and Austin, TX - both technology hubs.

As part of the acquisition, which was approved Tuesday, April 23 by Provo’s City Council, Google agreed to upgrade the city’s decade-old network to gigabit technology along with completing network construction. Residents already on iProvo will be able to connect for a $30 activation fee and receive free service for seven years. “Higher capacity at reasonable prices is a benefit,” Mayor Curtis said. When it’s free, it’s even better.

The new Internet for Provo’s residents and businesses will now truly be ubiquitous. Or at least, fast, very fast: connections from the fiber optic network are “100 times faster than today's broadband,” according to Google.

Connection to Business
In an interview with Mobile Enterprise, John Curtis, Mayor of Provo, noted that the acquisition was never approached from a tourism angle, but a permanent reason — business. “The landscape is rich and deep with entrepreneurial spirit,” he said, adding that it is enhanced by Brigham Young University and a heavy emphasis on technology. (There are several large companies in the area but many are small and medium sized.)

That’s probably what caught Google’s eye, along with existing infrastructure instead of starting from scratch. “Utah is already home to 100s of tech companies and startups, and many of them are based in Provo,” said Kevin Lo, General Manager, Google Fiber, in a company statement. “These businesses, and hopefully many more startups, will be able to use Google Fiber to create the applications of the future.”

Mayor Curtis said there has been immediate feedback on many levels, from current residents to company owners who are enthusiastic about moving business to Provo. “The Economic Development Department is dealing with those who are taking it to the next level,” he said. “Businesses bring opportunities, innovation.”

The area is excited, to say the least, about Google Fiber opening up bandwidth beyond what people are currently using. But with economic development comes growth opportunities and new jobs and a better outlook. Kansas City, MO, for example, was recently upgraded in its debt ratings from negative to stable. Fitch Ratings cited Google Fiber as one reason. “The network is already attracting a number of smaller internet and data companies to the city and has the potential to make a significant economic impact,” read the report.

In addition to job growth and new developments for Provo, crucial infrastructure that relies on mobility, from emergency responders to traffic management, will likely see key benefits going forward. “We are anticipating large impacts in education, healthcare and community involvement, and many aspects of the vibrancy of the city,” Mayor Curtis said.

And just as Utah officials visited Kansas to see how that area has fared since its initial rollout, Mayor Curtis expects others to look to Provo in the future.

One Thread
While Provo is likely to become a regional success story, Dexter Thillien, Senior Analyst, IHS, does not believe Google Fiber is going to be deployed nationwide anytime soon. He cited two reasons in an interview with Mobile Enterprise:

One, the cost is prohibitive. While major carriers like Verizon and AT&T collectively spent 10s of billions on their infrastructure, it’s unlikely Google Fiber could do the same to penetrate more markets. Two, even if they tried, the incumbent competition has the distinct advantage and can easily step up the deployments.

If Google Fiber does get a sudden, burning desire to take on more cities, it would be better off going niche — underserved municipal areas.

Why are they doing it at all? To disrupt the broadband market? Perhaps by performing bandwith analysis and usage, the company could figure out future content and services, including a television platform? After all, the company is built on the success of a monetized search engine. “But they don’t really need to run a network to do that,” Thillien said. “It’s more likely looking at the impact on infrastructure in a specific market.”

When the broadband project was announced back in 2010, 1,100 communities applied to be a test case, with some towns employing aggressive (and humorous) campaigns to get Google’s attention. The company noted at the time its plan was “to reach a total of at least 50,000 and potentially up to 500,000 people with this experiment.”

But surely it’s not just an experiment, and is not going to stop with 500K individuals, not when more than a thousand communities are hoping to get on board and not when Google is building a business model that looks ahead, not to the past.

During his keynote address at the recent Fiber to the Home Council Americas conference, Milo Medin, Vice President, Access Services, Google Fiber, confirmed as much. “Our goal is not just to create a new competitive choice for users,” he said, adding the company cares about speed, to move the web forward and enable new possibilities. In the future, Google wants to work with municipalities that can streamline the fiber optic network deployment, he said, from dedicated inspections, expedited permits and simplifying security audits, among other processes.

Google, like any other successful company that stays in business, also cares about profit. “We expect to make money from doing this. It’s a great business to be in,” Medin said.

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