4 ms·

Can't say I'm surprised. I expect Google fi to have a similar fate in a few years. It's not Google business.

jonknee 10y ago
Project Fi doesn't involve nearly the amount of staff though--they're using someone else's network. As Google has found out, digging holes and getting permits doesn't get cheaper with better software.
- Yhippa 10y ago
  I have no idea what the economics are but I imagine the carriers they're piggybacking off of could charge higher fees for MVNOing if Fi were to get to a certain scale.
  - jonknee 10y ago
    Depending on the contracts they have I guess anything's possible, but MVNOs aren't a new thing and they don't typically get kicked off a network for being successful.
  - hga 10y ago
    Compared the the standard MVNO, they're less exposed because their system uses WiFi whenever possible. How much less that exposure is I have no idea. Disclaimer: I'm a Project Fi subscriber for the last half year or so.
- zanny 10y ago
  They could build a robot that digs the holes. Maybe with Boston Dynamics robots. Oh...
  - knz 10y ago
    I'm not sure the cost is in digging the actual hole. The costs for planning, permitting and litigation can be substantial.
kyrra 10y ago
What fate would that be? Fiber isn't going away, they have just stopped expansion. There are also hints about investing in other tech instead of laying new fiber across an entire city (WebPass as the article mentions). I agree that Fiber isn't Google business, which is why Alphabet was created. It allows for the company to try expanding into areas that aren't just software. Also, Google does a LOT of infrastructure work with datacenters and the fiber they own across the country/world. (though that is more business focused than consumer/residential)
- ocdtrekkie 10y ago
  If Google isn't pursuing development of it, expect it to go away. They'll probably sell off Google Fiber, either in whole to a national ISP or piecemeal to more local providers. Google has no interest in unprofitably maintaining a ton of physical infrastructure for a tiny number of customers.
- exelius 10y ago
  Fiber's operations and infrastructure will be sold to one of the major telecoms within the year (just like Google did with Motorola once it ceased to be useful). My money is on CenturyLink since Google's approach meshes well with their overbuilding strategy and footprint. It's a 0-5% margin business for the foreseeable future; and best-case scaled scenarios it's a 10% margin business with huge capex. Google shouldn't be interested in anything with less than a 20% margin at scale. So from a portfolio standpoint, it was a stupid bet. My guess is that Google entered the business without knowing all the nuance of the access world. They made an assumption that there was some magic bullet of architecture and comp sci that could lead to game-changing economies of scale. But it turns out the telecoms are pretty solid on the engineering / design side, and customer service and network maintenance are the big cost centers. Neither of those can be automated with algorithms or AI (well, network maintenance sort of can be, but the telecoms are already on top of it), so there's not a ton of opportunity for Google to leverage its strengths. Running a datacenter is a very different business from running access networks. Operations that are cheap in a datacenter are expensive in the field (cable runs, equipment swaps, etc.) Likewise, there are different considerations around who does the work -- it makes sense to hire full-time people in a datacenter; less so when your equipment is scattered over a few million square miles. All of that leads to a very different operating model, so it's no wonder that Google couldn't figure it out.
gregburd 10y ago
I think the business, regulatory and infrastructure requirements are entirely different. They co-opt existing networks and only have to provide a SIM card, like other MVNOs. They don't have to deal with multi-year back-room deals for community access to dig trenches or hang wire to get into neighborhoods. I'm a Google fi user and I hope that your prediction doesn't come true. It's a fantastic service. If Google fiber was available in my neighborhood I'd be a subscriber to that too, so perhaps I'm a bit biased. :)
mdip 10y ago
I'm not so sure about Project Fi disappearing. The fact is, they have a national rollout of Project Fi because they were able to operate in a way that allowed them to resell existing carriers' products as an MVNO. And they were able to offer something unique over existing MVNOs by combining Sprint and T-Mobile's networks, which required a special radio/SIM card combination since the networks are quite different. It had the practical upshot where I live of providing superior service to even the best available networks (which are AT&T and Verizon in my area) and giving me excellent coverage in an area served poorly by each of the networks independently[0]. Ensuring that people have fast, reliable, non-discriminatory access to the internet is within Google's best interest. Assuming the next administration undoes network neutrality, Google could find itself and its products penalized if carriers offer alternatives that don't include surcharges (unlikely, yes, but possible considering many don't have more than one choice for broadband service). And, speaking personally, working with Project Fi has been wonderful. I've interacted with customer service on three occasions (most recently a month ago due to a software update killing my wife's phone) and they're incredible -- going well over and above what the other carriers have done for me when I've run into trouble. It's particularly nice for me since I have data usage requirements that occasionally balloon in a given month but are often very low -- it's saved me about $80/month as a result[1]. And from what I read, it's a lean business. Since they don't manage the network, all of the phones offered are in-house brands (Nexus and Pixel), there's a lot of overlap everywhere except for customer service[2]. [0] I'm about a year out of date with data since I've had Fi since then, but the thumb area of Michigan had parts that were covered well by T-Mobile, Sprint, Verizon and AT&T, but those places were interspersed with a lot of dead areas. Sprint and T-Mobile appear to almost exist in places where the other isn't so as a result of combining the two, I get 4G through every part of the thumb that I spend a lot of time in the summer. [1] My data usage is almost always under a gig, but I occasionally run into a situation where I need a lot of data for a few days. As a result, I always kept a data plan that was five times what I required "just in case" because the overage charges were extreme on Verizon when I was a customer and it was "just easier". I probably could have managed to keep a lower plan and only called in when I went over, upgrading temporarily (they used to let you upgrade and backdate that upgrade to the previous month a few times), but I didn't like the risk or the hassle. [2] When I had this problem with my Nexus phone, I was transferred from Fi support to a much more general hardware support group that sounded like it was specific to the Nexus phones. Despite the transfer, this call was the shortest I've dealt with to get to resolution and I was pleased that the CSRs all had a great command of the English language (the hardware guys had accents but they weren't so thick that I had a difficult time understanding them). Getting a replacement sent over night with Saturday delivery at no charge was really great.

Project Fi doesn't involve nearly the amount of staff though--they're using someone else's network. As Google has found out, digging holes and getting permits doesn't get cheaper with better software.

Yhippa 10y ago
I have no idea what the economics are but I imagine the carriers they're piggybacking off of could charge higher fees for MVNOing if Fi were to get to a certain scale.
- jonknee 10y ago
  Depending on the contracts they have I guess anything's possible, but MVNOs aren't a new thing and they don't typically get kicked off a network for being successful.
- hga 10y ago
  Compared the the standard MVNO, they're less exposed because their system uses WiFi whenever possible. How much less that exposure is I have no idea. Disclaimer: I'm a Project Fi subscriber for the last half year or so.
zanny 10y ago
They could build a robot that digs the holes. Maybe with Boston Dynamics robots. Oh...
- knz 10y ago
  I'm not sure the cost is in digging the actual hole. The costs for planning, permitting and litigation can be substantial.

kyrra 10y ago

What fate would that be? Fiber isn't going away, they have just stopped expansion. There are also hints about investing in other tech instead of laying new fiber across an entire city (WebPass as the article mentions). I agree that Fiber isn't Google business, which is why Alphabet was created. It allows for the company to try expanding into areas that aren't just software. Also, Google does a LOT of infrastructure work with datacenters and the fiber they own across the country/world. (though that is more business focused than consumer/residential)

ocdtrekkie 10y ago
If Google isn't pursuing development of it, expect it to go away. They'll probably sell off Google Fiber, either in whole to a national ISP or piecemeal to more local providers. Google has no interest in unprofitably maintaining a ton of physical infrastructure for a tiny number of customers.
exelius 10y ago
Fiber's operations and infrastructure will be sold to one of the major telecoms within the year (just like Google did with Motorola once it ceased to be useful). My money is on CenturyLink since Google's approach meshes well with their overbuilding strategy and footprint. It's a 0-5% margin business for the foreseeable future; and best-case scaled scenarios it's a 10% margin business with huge capex. Google shouldn't be interested in anything with less than a 20% margin at scale. So from a portfolio standpoint, it was a stupid bet. My guess is that Google entered the business without knowing all the nuance of the access world. They made an assumption that there was some magic bullet of architecture and comp sci that could lead to game-changing economies of scale. But it turns out the telecoms are pretty solid on the engineering / design side, and customer service and network maintenance are the big cost centers. Neither of those can be automated with algorithms or AI (well, network maintenance sort of can be, but the telecoms are already on top of it), so there's not a ton of opportunity for Google to leverage its strengths. Running a datacenter is a very different business from running access networks. Operations that are cheap in a datacenter are expensive in the field (cable runs, equipment swaps, etc.) Likewise, there are different considerations around who does the work -- it makes sense to hire full-time people in a datacenter; less so when your equipment is scattered over a few million square miles. All of that leads to a very different operating model, so it's no wonder that Google couldn't figure it out.

gregburd 10y ago

I think the business, regulatory and infrastructure requirements are entirely different. They co-opt existing networks and only have to provide a SIM card, like other MVNOs. They don't have to deal with multi-year back-room deals for community access to dig trenches or hang wire to get into neighborhoods. I'm a Google fi user and I hope that your prediction doesn't come true. It's a fantastic service. If Google fiber was available in my neighborhood I'd be a subscriber to that too, so perhaps I'm a bit biased. :)

mdip 10y ago

I'm not so sure about Project Fi disappearing. The fact is, they have a national rollout of Project Fi because they were able to operate in a way that allowed them to resell existing carriers' products as an MVNO. And they were able to offer something unique over existing MVNOs by combining Sprint and T-Mobile's networks, which required a special radio/SIM card combination since the networks are quite different. It had the practical upshot where I live of providing superior service to even the best available networks (which are AT&T and Verizon in my area) and giving me excellent coverage in an area served poorly by each of the networks independently[0]. Ensuring that people have fast, reliable, non-discriminatory access to the internet is within Google's best interest. Assuming the next administration undoes network neutrality, Google could find itself and its products penalized if carriers offer alternatives that don't include surcharges (unlikely, yes, but possible considering many don't have more than one choice for broadband service). And, speaking personally, working with Project Fi has been wonderful. I've interacted with customer service on three occasions (most recently a month ago due to a software update killing my wife's phone) and they're incredible -- going well over and above what the other carriers have done for me when I've run into trouble. It's particularly nice for me since I have data usage requirements that occasionally balloon in a given month but are often very low -- it's saved me about $80/month as a result[1]. And from what I read, it's a lean business. Since they don't manage the network, all of the phones offered are in-house brands (Nexus and Pixel), there's a lot of overlap everywhere except for customer service[2]. [0] I'm about a year out of date with data since I've had Fi since then, but the thumb area of Michigan had parts that were covered well by T-Mobile, Sprint, Verizon and AT&T, but those places were interspersed with a lot of dead areas. Sprint and T-Mobile appear to almost exist in places where the other isn't so as a result of combining the two, I get 4G through every part of the thumb that I spend a lot of time in the summer. [1] My data usage is almost always under a gig, but I occasionally run into a situation where I need a lot of data for a few days. As a result, I always kept a data plan that was five times what I required "just in case" because the overage charges were extreme on Verizon when I was a customer and it was "just easier". I probably could have managed to keep a lower plan and only called in when I went over, upgrading temporarily (they used to let you upgrade and backdate that upgrade to the previous month a few times), but I didn't like the risk or the hassle. [2] When I had this problem with my Nexus phone, I was transferred from Fi support to a much more general hardware support group that sounded like it was specific to the Nexus phones. Despite the transfer, this call was the shortest I've dealt with to get to resolution and I was pleased that the CSRs all had a great command of the English language (the hardware guys had accents but they weren't so thick that I had a difficult time understanding them). Getting a replacement sent over night with Saturday delivery at no charge was really great.