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Google prepares 34-city push for ultra-fast Fiber service

Google Fiber Considering Expansion To 34 New Cities

(Reuters) - Google Inc is exploring a major expansion of its super-fast "Fiber" TV and Internet service, which could extend the nascent network to 34 more U.S. cities and pose a competitive threat to home broadband providers.

Google executives told reporters on Wednesday the search company has reached out in recent weeks to cities from nine metropolitan areas around the country, including San Jose, Atlanta and Nashville, to discuss the feasibility of building out Fiber, which Google says delivers the Internet at speeds up to 100 times faster than average networks.

As Google delivers more music, videos and other content to mobile devices, it is increasing investment in ensuring it gets the bandwidth it needs. Web-access projects like Fiber could also help grow revenues beyond its maturing search business, and give it more insight into consumers' online habits -- which, in turn, is crucial to making ads more effective.

Google had initially billed its first Fiber broadband offer, launched in Kansas City last year, as a test project to spur development of Web services and technology. But industry observers speculate that the one-gigabit-a-second high-speed Internet service could become a viable business for the company, prompting traditional rivals such as AT&T to mount a defense.

"We continue to believe that Google Fiber is an attempt by Google to build a profitable, stand-alone business," argued Carlos Kirjner, senior Internet analyst for Bernstein Research.

"Google is taking the long view and we think in five or more years, it could turn out to be a significant, profitable business for Google and headwind for incumbents."

AT&T Inc said last year it was ready to build its own one-gigabit-per-second fiber network in Austin, provided it got the same treatment from local authorities as Google. AT&T CEO Randall Stephenson said in September he expects the telecoms carrier to expand that offer to "multiple markets" in coming years.

And Comcast Corp, which will become the largest cable provider in the country if it passes antitrust scrutiny for its proposed $45 billion acquisition of Time Warner Cable, argued to regulators this month that Google Fiber could threaten its business over time.

Google now provides Fiber service, at up to $120 a month, in the Kansas City metropolitan area. Last year, it announced plans to expand in Provo, Utah and Austin, Texas in 2014.

The consumer response so far in Kansas City has been "overwhelming," Kevin Lo, General Manager of Google Fiber, told reporters on a Wednesday conference call. He did not elaborate.

DISRUPTION AND EXPENSE

To make a difference to Google's overall business, which is expected to generate roughly $70 billion in revenue this year, Fiber needs to expand dramatically.

In a city of one million households for example, Google would reap a modest $288 million a year in subscription revenue if 20 percent of families were to sign up for its $120 monthly service. If it were able to enlist half the homes in the city, that could mean $720 million in annual revenue.

Fiber may not prove feasible for every one of the 34 cities under consideration. The company will make a final decision on which of those get Fiber by the end of the year, Lo said.

Building high-speed networks is a cumbersome process that typically requires tearing up streets and working with local governments to get access to utility poles and approvals.

Unlike in the past, when networks expand over time, Google's approach will be to build out all at once in specific urban markets.

Kirjner has estimated the cost of making Fiber available to 300,000 homes in the greater Kansas City region at $170 million. Expanding to 20 million U.S. homes, which Kirjner says is not likely for now, would cost $10 billion to $15 billion.

To minimize disruption to locals, Google will work with city leaders to make use of existing infrastructure -- such as conduits, and water, gas or electricity lines, Lo added.

"We plan to share what we learn in these 34 cities," vice president of Google Access Services Milo Medin wrote in a blogpost. "It might not work out for everyone. But cities who go through this process with us will be more prepared for us or any provider who wants to build a fiber network."

(Reporting by Edwin Chan; Editing by Alden Bentley)

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1000|Char. 1000  Char.
Eve February 19 2014 at 9:06 PM

Bring it on! Other countries have better internet service, and at a cheaper rate!

Flag Reply +2 rate up
RICHARD February 20 2014 at 1:35 AM

Talk....talk....talk. That is all I hear from complainers. Got to stop talking and take action. What action, you say? The only action that would hurt cablle\satallite companies would be mass (in the millions) cancellations. But, that will never happen. Just like when gas prices went sky high; did the masses not drive anymore to change that? No, but, that would of been the only way to hurt these big companies and CEO's. IT AIN 'T GOING TO HAPPEN PEOPLE.

Flag Reply +1 rate up
Sherri Lynn Baldwin February 20 2014 at 11:51 AM

Well Skype is as good as this I love that it is video chat and it is free 100%

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1 reply
Sekinu2 Sherri Lynn Baldwin February 20 2014 at 1:08 PM

What?? Skype is just a program or app and has nothing to do with this articale. Yes its free but you need a provider to use it ie comcast, goole, AT&T

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1 reply
frozenbull Sekinu2 February 20 2014 at 2:53 PM

Bran Flakes have lots of fiber .

Flag 0 rate up
dumasjohnj February 20 2014 at 11:39 AM

Kick backs and free services to the city are legalized corruption in return for limited competition and higher consumer prices.

Flag Reply +2 rate up
Jeff Newman February 20 2014 at 2:30 AM

Anything is better than AT&T U-Verse, and I mean everything and anything and what ever I forgot to mention - they would have to be, in my mind - the sorriest ass bunch of nincompoops to ever come into being. Like always - they got swallowed up by the Walmart-O-Nations of it all - the force of the Nation - what the hell does that mean anyway? I don't know, but I bet y'all know what I am talking about - they used to good, but now the suck - kinda thing - man oh live, it's like dealing with a country that has no name dealing with them. Everybody suddenly is named "Bob" and they have no address and no direct phone number and no real anything but a job working for a company that has no real name. The bill keeps on a-coming, but danged if you can do anything about it - without three days worth of your time filling out Internet quantum physics that Uncle Al - wouldn't know what to do to solve these types of made up - waste of time - insane things - and damn it all. Now - everybody has gone this sort of way - and that's what wrong with all of us, in my mind. You have to go to school to learn how to cut them off, turn them on - or change anything about "them." I thought - if I am paying the bill, I am the customer? Wrong, yet again. Amazon is the perfect example of making a mountain out of a molehill and making jillions and multibillion's of bucks, doing what? Don't nobody truly know but your hairdresser, is sure to know. Cheap Chinese reverse reengineering horse crap - that's what they all have become - made by slaves in islands that have no real name - oh forget about it. Hopefully you know what I mean. I am old - and I want things to stay the same, anymore. Worship the gizmo man - that's all you got anymore is the gizmo-moduction of the every more and so be it. I call this "thing" - "Informational Entropy." The more you learn "it" - the more stupider you become. Now - that's what I am trying to say, I think. Let me rethink - it's like "2 for 1 Money Back Warranty" - Infomercial Science - yup - bow howdy, ain't it the truth, anymore - WI-Fi Intercontinental Champions?

Flag Reply +1 rate up
1 reply
frozenbull Jeff Newman February 20 2014 at 6:52 AM

Take your meds the doctor perscibed for you Feel better

Flag Reply 0 rate up
lorimidmroi February 20 2014 at 10:48 AM

Bring it! I am so tired of overpaying for Time Warner!

Flag Reply +5 rate up
kiraedom February 20 2014 at 2:52 AM

I would pay that $120 in a heartbeat if they were actually delivering that kind of speed for access to sites beyond their data centers and their network. Bring it to Phoenix! I know lots of people who would pay for that.

Flag Reply +1 rate up
judyflynn1 February 20 2014 at 10:18 AM

Comcast, AT&T afraid of a quality service at an affordable price ?

Flag Reply +7 rate up
1 reply
TTigerLilyx2 judyflynn1 February 20 2014 at 2:08 PM

AT&T slows down speeds to make you crazy with frustration so you will upgrade to a more expensive plan and even then the service sucks. They slowed my areas service for 3 years, the Gov sued them. I got a check for $2.37 cents as my 'refund'. Customer service??? Worst EVER.
I'd switch to Google in a heartbeat, just to annoy AT&T and Cox.

Flag Reply 0 rate up
dorc792 February 20 2014 at 6:26 AM

its about time...comcast gets dumped...

Flag Reply +4 rate up
1 reply
davhford dorc792 February 20 2014 at 8:45 AM

It can't come soon enough!!!! The only way I can change from Comcast is to have an ugly antena installed on the house. At best, this is a hidious decor that proves itself worthless during inclement weather.

Flag Reply 0 rate up
Kay February 20 2014 at 9:55 AM

I would love to be able to get cable, but I live four miles from where it stops in my area. So I have to try to depend on satellite since I have real trouble getting a signal from our local channels. In fact all I have ever been able to get here, even with an outside antenna, are ABC and CBS. Same with my TV in my bedroom since I switched to an HDTV there. At least with my old TV in the bedroom I could get several channels but now all I get are four PBS stations there. And of course I have trouble with satellite when ever we have any type of storm, especially wind from the West South/West.

I was talking to a friend who has cable in our near by larger city and she was telling me that their cable bill has gone sky high also. They had Charter but switched to AT&T and it is also going sky high. At first they liked it but now they charge for every little thing, same with Charter. I was talking with two older ladies the other day, while getting my oil changed, and they both said the same thing about Charter. They keep offering to give customers a free "box" to be able to hook up another TV, such as in the bedroom or something like that. But what Charter doesn't tell you is that if you hook that box up, they will start to charge you a much higher price for using said box! They apparently make it sound as if you are getting something for free and then they stick it to you!

Flag Reply +2 rate up
2 replies
shaybird Kay February 20 2014 at 10:11 AM

Clearly, you have not had cable where you live. Otherwise you would know that all cable companies stick it to you.

Flag Reply +4 rate up
TTigerLilyx2 Kay February 20 2014 at 1:55 PM

You should be able to pick up all the analog channels, ABC, NBC, CBS, I have 4 PBS channels, plus CW, ION, etc. I get about 17 channels, free. Love it. Anything else I can find on the internet.

Flag Reply 0 rate up
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