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Entrenched ISPs have complained that Google is getting special treatment. I find that somewhat disingenuous. It seems to me the difference between existing ISPs

Entrenched ISPs have complained that Google is getting special treatment. I find that somewhat disingenuous. It seems to me the difference between existing ISPs limp efforts to expand broadband and Google's is that Google did a decent job of telling municipalities what they needed to bring higher speed data to their constituents—and they did it in a very public way. I think it's a good example of how one can bring attention to the senseless bureaucracy we all complain about. Instead of complaining, bring about actionable steps.

tsotha 13y ago
Google is really good at generating buzz, and instead of rolling out a plan which would have Google installing fiber in, say, every city over a certain size or everywhere east of the Mississippi, they're saying "we'll do this city, then this one, then this one..." If the local politicians don't play ball, then there's no Google fiber. That's where the buzz comes in - "Why is Google installing everywhere else but not here?" It's smart politics on Google's part, particularly since they're probably not willing to sink in enough capital to do more than a few markets a year anyway.
- hrkristian 13y ago
  Well made point. Combine that with chrissnell's point [1] and it makes even more sense in my mind. Google Fiber isn't really necessary for the common household, yet. They might be mixing an investment in start-ups with a political agenda. For the latter, if they can push the competition in the rest of the U.S. to even 10% of their offering you'll still have a massive speed increase (and a brand spankin' new infrastructure). [1] https://news.ycombinator.com/item?id=7397174 https://news.ycombinator.com/item?id=7397174
pekk 13y ago
How do they explain why Google is getting special treatment? It's not like cities have a special, irrational hardon for Google. It's that Google is making a reasonable deal to them. If Time-Warner wants to do the same thing, they can make the same deal. They don't want to make this kind of deal with cities. They want the government to prevent this kind of deal from being made.
- rayiner 13y ago
  Is Google making a reasonable deal? I.e. if they didn't have an advertising business to subsidize this with, would the terms still make business sense?
  - arg01 13y ago
    Generally being a sole infrastructure provider is a very secure investment. This is because you can overcharge until a competitor enters the market and then when competition appears you can undercut them as you no longer need to recoup capital costs while your competitor does. This can stop competitors entering the market as there is not an incentive to do so. There are a couple of factors that make this a reasonable investment for Google even though they're not the incumbent. The first is the old infrastructure is old enough that it is not capable of offering the same service as the new infrastructure without a significant amount of extra capital investment. Google also can cancel out some of what would be normal capital costs associated with a new entrant because they have related in house skills/services and the clout to bypass some regulatory capture. This means that the incumbents lose a lot of their advantages as they're playing catch up too and they have to work-in legacy systems. They can't offer the same service on their old infrastructure and have to offer a lower price until they can. To make matters worse they don't want to be too obvious in what they can offer as they could be stung by the state in other places if they act in a way that shows they are consistently abusing their monopoly or acting anti competitively. It's probably true that Google's investment is set to make money but I'd guess once you factor in opportunity cost it's not the smartest investment. But consider the other advantage they have is that they're not working in a vacuum, improvements in internet usage improves their core business, so even if they get out competed in this market it can help their overall bottom line.
  - selectodude 13y ago
    Google seems to think so. http://news.cnet.com/8301-1023_3-57586894-93/google-exec-sees-google-fiber-as-a-moneymaker/ http://news.cnet.com/8301-1023_3-57586894-93/google-exec-see...
  - kev009 13y ago
    Heh, cable companies are in the advertising business too. What's funny in the new internet age they're making an even greedier grab to triple dip - charge the content providers, charge the end user, and charge advertising clients.
wmf 13y ago
It's probably the case that nobody asked for the particular concessions Google asked for, so it's impossible to say that cities wouldn't have granted them. But it sure looks like Google is getting special deals that probably weren't available to either incumbents or smaller ISPs. I would be interested in hearing the perspective of ISPs that have already tried to deploy fiber.
a-priori 13y ago
The only reason Google is getting 'special treatment' is because they've shown that they're willing and able to spend the capital necessary to develop the residential telecom network in North America. The incumbent network operators and ISPs have been dragging their heels on that since the 90s, and since then it's fallen behind other parts of the world. Google Fibre is good for customers (hence the media buzz) and it's good for municipalities (hence their cooperation). Put the two together, and it looks like Google has a red carpet laid out in front of them simply because they're Google. But really it's just genuine excitement that someone -- anyone -- is bringing long-overdue upgrades to home internet connections.

tsotha 13y ago

Google is really good at generating buzz, and instead of rolling out a plan which would have Google installing fiber in, say, every city over a certain size or everywhere east of the Mississippi, they're saying "we'll do this city, then this one, then this one..." If the local politicians don't play ball, then there's no Google fiber. That's where the buzz comes in - "Why is Google installing everywhere else but not here?" It's smart politics on Google's part, particularly since they're probably not willing to sink in enough capital to do more than a few markets a year anyway.

hrkristian 13y ago
Well made point. Combine that with chrissnell's point [1] and it makes even more sense in my mind. Google Fiber isn't really necessary for the common household, yet. They might be mixing an investment in start-ups with a political agenda. For the latter, if they can push the competition in the rest of the U.S. to even 10% of their offering you'll still have a massive speed increase (and a brand spankin' new infrastructure). [1] https://news.ycombinator.com/item?id=7397174 https://news.ycombinator.com/item?id=7397174

pekk 13y ago

How do they explain why Google is getting special treatment? It's not like cities have a special, irrational hardon for Google. It's that Google is making a reasonable deal to them. If Time-Warner wants to do the same thing, they can make the same deal. They don't want to make this kind of deal with cities. They want the government to prevent this kind of deal from being made.

rayiner 13y ago
Is Google making a reasonable deal? I.e. if they didn't have an advertising business to subsidize this with, would the terms still make business sense?
- arg01 13y ago
  Generally being a sole infrastructure provider is a very secure investment. This is because you can overcharge until a competitor enters the market and then when competition appears you can undercut them as you no longer need to recoup capital costs while your competitor does. This can stop competitors entering the market as there is not an incentive to do so. There are a couple of factors that make this a reasonable investment for Google even though they're not the incumbent. The first is the old infrastructure is old enough that it is not capable of offering the same service as the new infrastructure without a significant amount of extra capital investment. Google also can cancel out some of what would be normal capital costs associated with a new entrant because they have related in house skills/services and the clout to bypass some regulatory capture. This means that the incumbents lose a lot of their advantages as they're playing catch up too and they have to work-in legacy systems. They can't offer the same service on their old infrastructure and have to offer a lower price until they can. To make matters worse they don't want to be too obvious in what they can offer as they could be stung by the state in other places if they act in a way that shows they are consistently abusing their monopoly or acting anti competitively. It's probably true that Google's investment is set to make money but I'd guess once you factor in opportunity cost it's not the smartest investment. But consider the other advantage they have is that they're not working in a vacuum, improvements in internet usage improves their core business, so even if they get out competed in this market it can help their overall bottom line.
- selectodude 13y ago
  Google seems to think so. http://news.cnet.com/8301-1023_3-57586894-93/google-exec-sees-google-fiber-as-a-moneymaker/ http://news.cnet.com/8301-1023_3-57586894-93/google-exec-see...
- kev009 13y ago
  Heh, cable companies are in the advertising business too. What's funny in the new internet age they're making an even greedier grab to triple dip - charge the content providers, charge the end user, and charge advertising clients.

wmf 13y ago

It's probably the case that nobody asked for the particular concessions Google asked for, so it's impossible to say that cities wouldn't have granted them. But it sure looks like Google is getting special deals that probably weren't available to either incumbents or smaller ISPs. I would be interested in hearing the perspective of ISPs that have already tried to deploy fiber.

a-priori 13y ago

The only reason Google is getting 'special treatment' is because they've shown that they're willing and able to spend the capital necessary to develop the residential telecom network in North America. The incumbent network operators and ISPs have been dragging their heels on that since the 90s, and since then it's fallen behind other parts of the world. Google Fibre is good for customers (hence the media buzz) and it's good for municipalities (hence their cooperation). Put the two together, and it looks like Google has a red carpet laid out in front of them simply because they're Google. But really it's just genuine excitement that someone -- anyone -- is bringing long-overdue upgrades to home internet connections.