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Agreed. On your first point, I particularly agree that it won't faze Google. While I'm sure they want every business unit to be a money-maker, I don't think Goo

by nlh 14y ago

Agreed. On your first point, I particularly agree that it won't faze Google. While I'm sure they want every business unit to be a money-maker, I don't think Google is worried about the margins getting squeezed. I bet they've figured the value of just having more people on an unmetered high speed connection and might even be willing to lose money on the access. And I'd be particularly surprised if AT&T has a bigger appetite for price wars than Google :)

dclusin 14y ago
I agree with this. If there was any money in the pipes we wouldn't see nearly as many mergers of broadband and content companies. We also wouldn't see content companies getting into broadband either. The nice thing about Google is that their interests as you said are mutually beneficial here. E.g. faster broadband means more money for Google via ad sales. This isn't true with Comcast or other carriers.
mtgx 14y ago
Yeah, if AT&T is trying to play some kind of "chicken game" with Google, they will lose, because Google doesn't care that much about the profits as they do about dramatically increasing the competition in the ISP market. In fact, higher valuer/buck is Google's goal in all of this. AT&T is falling right in Google's "trap", sort of speak (which is a good thing for us). While Google may indeed have some thoughts that with all this popularity and head-start they could become a major ISP in US, their primary and original goal was exactly to get other companies to start offering Gigabit and affordable fiber connections, with no other limits or caps.
- shmerl 14y ago
  Does it mean Google will attempt to become a mobile provider as well? At least they could bring some sense into the market by providing a service with no caps.
  - commandar 14y ago
    I think it's pretty clear that Google isn't interested in being a telecom themselves, but have been making moves to try to push for the telecom industry to get their collective act together. They were instrumental, for example, in getting the FCC to force VZW to treat LTE service as a dumb pipe as a condition of the spectrum sale. And while much has been made of T-Mobile recently going contract-free, Google was pushing that with the original Nexus years ago, and I had a no-contract, un-subsidized G2 through T-Mobile in... 2010? Google already owns a ton of dark fiber, so it kind of makes sense for them to threaten the telecoms with competition to push things along. Building out a mobile network is a much bigger undertaking, so their pushes there have been -- and I suspect will continue to be -- a bit more behind the scenes in nature.
    - Retric 14y ago
      It's not just dumb pipes (ED: dark fiber) they also have YouTube which is ~15% of downstream traffic which they would be happy to stream inside there private network even with peering arrangements.
      - commandar 14y ago
        I was referring to the sale of the 700MHz C Block LTE band. One of the conditions of the spectrum license was that VZW couldn't restrict what devices were allowed on the network and that they couldn't restrict what applications ran over the network. VZW got hit with a $1.25M fine by the FCC last year for blocking tethering apps on LTE. http://www.theverge.com/2012/7/31/3207193/verizon-fcc-tethering-700mhz-open-access-fine http://www.theverge.com/2012/7/31/3207193/verizon-fcc-tether...
  - dragonwriter 14y ago
    > Does it mean Google will attempt to become a mobile provider as well? Google's been heavily involved in efforts centered around the use of spectrum "white spaces" for broadband, including for mobile devices; they aren't likely to become a traditional mobile provider, but...
- AnthonyMouse 14y ago
  >Yeah, if AT&T is trying to play some kind of "chicken game" with Google, they will lose, because Google doesn't care that much about the profits as they do about dramatically increasing the competition in the ISP market. The interesting thing is that AT&T's response is not going to help them, but the thing they actually could do is what Google would like them to do -- install gigabit fiber in other cities, that Google isn't in yet. If Google installs fiber in a city and AT&T doesn't, that city belongs to Google. AT&T is going to lose the large majority of their customers in that city if they don't upgrade their network in response. But if AT&T does install gigabit fiber in that city, now they're in the position of having to make a large capital investment only to enter an aggressive price war. In either case, for that city, AT&T is screwed. However, suppose AT&T decides instead to install gigabit fiber in, say, Chicago, or Hartford. Preemptively. Those cities immediately fall off the short list for the next Google Fiber rollout, because why put fiber in a city that already has it when there are so many that don't? So now AT&T owns the market in that city. They still had to make the capital investment, but at least now they stave off the subsequent price war. And if they do it in all the cities in their service area which would be good candidates, the next Google Fiber city ends up being in Verizon territory -- unless Verizon et al all do the same thing, in which case Google may just bow out having accomplished their goal.

by nlh 14y ago

dclusin 14y ago

I agree with this. If there was any money in the pipes we wouldn't see nearly as many mergers of broadband and content companies. We also wouldn't see content companies getting into broadband either. The nice thing about Google is that their interests as you said are mutually beneficial here. E.g. faster broadband means more money for Google via ad sales. This isn't true with Comcast or other carriers.

mtgx 14y ago

Yeah, if AT&T is trying to play some kind of "chicken game" with Google, they will lose, because Google doesn't care that much about the profits as they do about dramatically increasing the competition in the ISP market. In fact, higher valuer/buck is Google's goal in all of this. AT&T is falling right in Google's "trap", sort of speak (which is a good thing for us). While Google may indeed have some thoughts that with all this popularity and head-start they could become a major ISP in US, their primary and original goal was exactly to get other companies to start offering Gigabit and affordable fiber connections, with no other limits or caps.

shmerl 14y ago
Does it mean Google will attempt to become a mobile provider as well? At least they could bring some sense into the market by providing a service with no caps.
- commandar 14y ago
  I think it's pretty clear that Google isn't interested in being a telecom themselves, but have been making moves to try to push for the telecom industry to get their collective act together. They were instrumental, for example, in getting the FCC to force VZW to treat LTE service as a dumb pipe as a condition of the spectrum sale. And while much has been made of T-Mobile recently going contract-free, Google was pushing that with the original Nexus years ago, and I had a no-contract, un-subsidized G2 through T-Mobile in... 2010? Google already owns a ton of dark fiber, so it kind of makes sense for them to threaten the telecoms with competition to push things along. Building out a mobile network is a much bigger undertaking, so their pushes there have been -- and I suspect will continue to be -- a bit more behind the scenes in nature.
  - Retric 14y ago
    It's not just dumb pipes (ED: dark fiber) they also have YouTube which is ~15% of downstream traffic which they would be happy to stream inside there private network even with peering arrangements.
    - commandar 14y ago
      I was referring to the sale of the 700MHz C Block LTE band. One of the conditions of the spectrum license was that VZW couldn't restrict what devices were allowed on the network and that they couldn't restrict what applications ran over the network. VZW got hit with a $1.25M fine by the FCC last year for blocking tethering apps on LTE. http://www.theverge.com/2012/7/31/3207193/verizon-fcc-tethering-700mhz-open-access-fine http://www.theverge.com/2012/7/31/3207193/verizon-fcc-tether...
- dragonwriter 14y ago
  > Does it mean Google will attempt to become a mobile provider as well? Google's been heavily involved in efforts centered around the use of spectrum "white spaces" for broadband, including for mobile devices; they aren't likely to become a traditional mobile provider, but...
AnthonyMouse 14y ago
>Yeah, if AT&T is trying to play some kind of "chicken game" with Google, they will lose, because Google doesn't care that much about the profits as they do about dramatically increasing the competition in the ISP market. The interesting thing is that AT&T's response is not going to help them, but the thing they actually could do is what Google would like them to do -- install gigabit fiber in other cities, that Google isn't in yet. If Google installs fiber in a city and AT&T doesn't, that city belongs to Google. AT&T is going to lose the large majority of their customers in that city if they don't upgrade their network in response. But if AT&T does install gigabit fiber in that city, now they're in the position of having to make a large capital investment only to enter an aggressive price war. In either case, for that city, AT&T is screwed. However, suppose AT&T decides instead to install gigabit fiber in, say, Chicago, or Hartford. Preemptively. Those cities immediately fall off the short list for the next Google Fiber rollout, because why put fiber in a city that already has it when there are so many that don't? So now AT&T owns the market in that city. They still had to make the capital investment, but at least now they stave off the subsequent price war. And if they do it in all the cities in their service area which would be good candidates, the next Google Fiber city ends up being in Verizon territory -- unless Verizon et al all do the same thing, in which case Google may just bow out having accomplished their goal.