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Google Fiber, the 'Free Market Success Story' That Wasn't
Free Marketeers Celebrate Google Fiber, Ignore Subsidies
by Karl Bode Friday 07-Sep-2012 tags: business · bandwidth · Politics
A few weeks back we noted how Google's franchise deal with Kansas City for Google Fiber was a particularly sweet arrangement. Not only does the deal allow Google to walk away from the build in two years if things aren't going well, it allows Google the right to cherry pick markets as they see fit without penalty. To have their city chosen Kansas City was willing to make these concessions, which tells you everything you need to know about how KC (and the thousands of applying cities not selected) felt about the quality of existing services.

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Ars Technica offers an interesting read noting how Conservatives (like new FCC Commissioner Ajit Pai and the CEI's Fred Campbell) are ironically championing Google Fiber as an example of a successful free market, despite the fact it's no such thing:

...the agreement between Google and Kansas City, MO, specifies that the city will "make space available to Google in City facilities for the installation of Google’s Central Office equipment and for additional network facilities," will "provide power necessary for Google’s equipment at City locations," and "will not charge Google for such space, power, or related services." Obviously, offering free (e.g. taxpayer-subsidized) power and rack space goes well beyond "regulatory concessions."

None of this is to say Google Fiber is necessarily bad; author Timothy Lee's point is that the free market (as it's portrayed in political rhetoric) is a bit of a myth, we need private and public funding to adequately wire the nation, and that free marketeers are somewhat inconsistent when it comes to what qualifies as a truly free market play. Lee also highlights how when you see someone in this industry whining about a "level playing field," the vast majority of the time they're interested in the exact opposite.

Apparently Campbell and Pai didn't get the memo stating that they were supposed to be outraged by government involvement in Google Fiber. They also didn't get the memo informing them that the free market has failed the United States broadband market in stellar fashion, resulting in slow, over-priced services in the majority of communities nationwide. Market failure is what prompted Google's entry into broadband in the first place, but to applaud it as a "free market success story" when it's subsidized, government-protected, not even up and running and will likely only exist in a few locations -- is fairly amusing.

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morbo
Complete Your Transaction

join:2002-01-22
00000

Different subsidies for different companies

Google Fiber is benefiting from a sweet arrangement of subsidies. I don't view it much different than incumbent telco and their sweet arrangement of being a former monopoly, their unchecked ability to charge consumers for pretend taxes and fees, and intimate ties to the federal government for 'National Security' spying as well as the FCC in their pocket.

Google gets congrats for even attempting to go up against that ominous wall of competition.
pandora
Premium
join:2001-06-01
Outland
kudos:1
Reviews:
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Re: Different subsidies for different companies

Google Fiber is benefiting a lot of people. All failure in the free market for Internet services is due to our government and it's regulations.

Companies often discriminate when placing product or stores. Some places can afford a Whole Food supermarket, some can't.

Karl hasn't gotten the memo that Obama is President, and liberals run the FCC. A commissioner is not the FCC. Yet Karl will blame anyone he can for all failures he perceives (well except Obama or Democrats).

Karl, the FCC has 5 commissioners and one chairman. 3 of the commissioners, one of whom is the chairman are liberals appointed by Democrats.

The FCC chairman, appointed by one Barrack Obama is Julius Genachowski. They were classmates at Harvard law school. »en.wikipedia.org/wiki/Julius_Genachowski

Ajit V. Pai the conservative Karl doesn't like was nominated by one Barrack Obama. »www.fcc.gov/leadership/ajit-pai

The development agreement, for Google to begin deployment of fiber in Kansas City was signed on March 30,2011 - »www.google.com/url?sa=t&rct=j&q=···UPoi1lPA

The Google fiber agreement went into effect a year before Ajit V. Pai took office, which was on May 7, 2012.

Facts won't stop Karl from being Karl.

Fortunately Google makes it each to check "Karl's" facts out and see if they stand.
--
"People demand freedom of speech as a compensation for the freedom of thought which they seldom use."
lemonade

join:2003-12-13
Los Angeles, CA

Free land and electricity?

Wow, i didn't know Google get free land and electricity.
Oh well, no matter what I see Google as a lesser of evils
Austinloop

join:2001-08-19
Austin, TX
kudos:1
Reviews:
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Re: Free land and electricity?

It is quite common for telecommunications companies to get "free" space in a building and "free" electricity, be it in a government building, or in a private sector location, such as an office building. The reasoning being that the provisioning of fiber facilities, at least in the private sector location is that the fiber adds value to the building.
majortom1029

join:2006-10-19
Lindenhurst, NY
kudos:1

Re: Free land and electricity?

The problem is they often do it thinking they have permission since its a public building. Here in work in 200 verizon came in without asking anybody and installed a fiber line to their CO and installed a CO box so they can run new lines for the village to here instead of their CO. I started and had the worst time trying to find anybody at Verizon to figure out what the box does.

I had one verizon tech tell me to unplug it. So I did .nobody from verizon figured out it was unplugged . since nobody at verizon claimed it even after me going all the way up we chucked it.

They never asked permission to install it here at the library. They figured they could get away with the free power and space since it was a public building.

I wouldnt doubt verizon and google are doing this all over and nobody has the knowledge to ask why is this here.
Austinloop

join:2001-08-19
Austin, TX
kudos:1
Reviews:
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Re: Free land and electricity?

Interesting. However all of the government and private building installations that I ever participated in had building officials and customers present and entrance facilities for the fiber and power requirements, including the type of electrical plugs were discussed, and agreed to, or the installation proceeded no further.

In short, in some 20 years of dealing with customer premise (both government and private) I have never seen an example such as you posted.
Chubbysumo

join:2009-12-01
Superior, WI
Reviews:
·Charter

Re: Free land and electricity?

me neither, after quite a few years working with governments(local and state), any ISP coming into a building(or anything at that), every little detail had to be discussed, from the hardware they were installing(serials and models) or would need so the building could keep track of it(if it gets stolen, which happens more often than you think in public buildings), and even down to exactly, to the foot, where it was going, and what kind of power requirements and plugs it would need. Then, once everything that was needed was discussed, each department would have to notified of the install, and where it was(so it could be added to building maintenance maps), and then each department would have to show up to put in what they needed to put in(ie. electrical would put in an outlet with a locking plug, networking would come and run the appropriate cables to it to hook into their existing network, general maintenece would come and drill a hole thru the wall or floor or wherever and put a fish cable thru for the installer, and then the installer would be the last step, and would just make the cable run and plug it into the wall and verify its getting internet, and then networking would come and hook it to their network. its an overly complex system, and an installer would not be allowed into many of the places of the building they would need access to without an escort of some kind, and without everyone knowing exactly what was happening long beforehand. In gov't stuff, installers just dont "show up" and put something in, every little thing has to be approved and set up ahead of time, and someone else is usually involved. I know this process better than most, since I helped get FTTP into our local libraries, and the steps needed were quite obnoxious, and very tech restricting. Took me 3 months to get the fiber from the ground in front to getting the modem connected to the libraries internal network for 1 building. I did 3 buildings, and it was over a year long process. Most cities have fiber for business users and such "downtown", and here is no different. If you have the cash, charter, and even centurylink will install FTTH, but its expensive service.

its me

@verizon.net
Hello...these public buildings (libraries, govt offices, the school PTA office) are wired with FREE service (VZ or Google) so the least they could do is foot the the minimal bill for the juice to run the stuff.

BTW I don't the VZ or Google collocate in govt/muni bldgs
axus

join:2001-06-18
Washington, DC
I think it also opens up Google Fiber to providing wholesale access to new companies that wish to resell their service, similar to how DSL was able to be resold due to telco subsidies. More competition sounds good.
InvalidError

join:2008-02-03
kudos:5

Re: Free land and electricity?

said by axus:

I think it also opens up Google Fiber to providing wholesale access to new companies

One problem with that: you need an awfully large company with extensive pre-existing peering arrangements to afford offering unmetered 1Gbps for $70/month.

I doubt "Mom&Pop" ISPs could afford to try competing against Google's own internet on Google's infrastructure since their internet transit costs would be several times higher (likely more than an order of magnitude) than Google's.

battleop

join:2005-09-28
00000
It's quite the opposite. It's more common that the building owner wants to charge you for space and electricity if you can even get in to begin with.

I was once a landlord before I got in to telecom when everyone was beating on your door to bring fiber into your building. Just like anyone else they had to sign a lease pay some rent to get to the tenants.
--
I do not, have not, and will not work for AT&T/Comcast/Verizon/Charter or similar sized company.
Austinloop

join:2001-08-19
Austin, TX
kudos:1
Reviews:
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Re: Free land and electricity?

Not, really in my experience. We usually dealt directly with the end user and let them handle the landlord. It usually involved the end user discussing the lease. We only had one or two cases of property owner wanting pay and that building didn't get service. We provided basic copper service to the building and that was that.

battleop

join:2005-09-28
00000

Re: Free land and electricity?

If you want to drop fiber and equipment to take the building OnNET then they want money. IF you are doing simple copper cross connects they don't seem to care.
--
I do not, have not, and will not work for AT&T/Comcast/Verizon/Charter or similar sized company.

LSURULES

@lusfiber.net
While I agree it is common to get free space in commercial buildings being served by a provider, it is absolutely not common to get free space in a Central Office environment. CoLocation cost do apply and at a premium for both space and power in most locations. If you were to co-locate in a ILEC central office you could expect to pay a hefty price as a provider.
iansltx

join:2007-02-19
Golden, CO
kudos:2
Reviews:
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Particularly since it appears as though the gear being installed is PON equipment (Passive Optical Network). Which doesn't take much space or power. Maybe a rack per building and a kilowatt of electricity, if that. It's not as if Google is asking to run a server farm at KC's expense.

LSURULES

@lusfiber.net

Re: Free land and electricity?

said by iansltx:

Particularly since it appears as though the gear being installed is PON equipment (Passive Optical Network). Which doesn't take much space or power. Maybe a rack per building and a kilowatt of electricity, if that. It's not as if Google is asking to run a server farm at KC's expense.

What do you think a Central Office location consist of? They are going to be housing many servers, transport, & many many video related devices in this location.
tmc8080

join:2004-04-24
Brooklyn, NY
Reviews:
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said by lemonade:

Wow, i didn't know Google get free land and electricity.
Oh well, no matter what I see Google as a lesser of evils

The two Kansas Cities knew what they were getting themselves into (and obligated to subsidize) just to get google fiber.. Think of it as a minor bidding war to win the opportunity and this is a small price to pay to put the telco & cableco on some major incumbent punishment. Hopefully in this "contract" if google pulls out, I hope the existing infrastructure would be able to be "bought" on the cheap by the cities and run it as full muni, as I doubt they would dismantle the infrastructure once "IN-PLACE"...

Let's see what happens in NOVEMBER first.. then you can almost predict the future..
aerith
Premium
join:2008-12-31
Milpitas, CA

Best quote by Karl Bode is

"the free market has failed the majority of the United States broadband market in stellar fashion, resulting in slow, over-priced services in the majority of markets."

As the pig man (RL) would say "Right On, Right On, Right On!!!"

The fascist market has done nothing to improve broadband choices for the USA, and probably will NOT improve for the next 100 years, unless Government tells the fascist market to say:

You the company must provide at least 100 mbps access, for no more than $100 (if government subsidies are needed, so be it) and any device that needs to have internet access, has a public IP address (this eliminates having a router, because if the router fails, one can't share internet access, however for wireless only devices, new equipment will need to be developed,) as well with no caps and/or "usage based billing," otherwise, you can't operate as an ISP in the USA.

I know the above is a "pipedream," but IF the USA wants to be number one in internet speed, it must do the above.

Unlike a San Jose Mercury News article I read this week saying "less regulation," MORE regulation, and/or higher goals are needed.

caseywor

join:2004-04-19
Mobile, AL
Reviews:
·Mediacom
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Re: Best quote by Karl Bode is

New companies and investors would be jumping to invest money in that kind of market! /sarc

"The fascist market has done nothing to improve broadband choices for the USA" - Ummmmm.....a lot more people have internet access now in 2012 than did in 2000 or 2002. Kind of an incorrect, overgeneralized statement don't you think?
sonicmerlin

join:2009-05-24
Cleveland, OH
kudos:1

Re: Best quote by Karl Bode is

said by caseywor:

New companies and investors would be jumping to invest money in that kind of market! /sarc

"The fascist market has done nothing to improve broadband choices for the USA" - Ummmmm.....a lot more people have internet access now in 2012 than did in 2000 or 2002. Kind of an incorrect, overgeneralized statement don't you think?

Oh gosh, I wonder if that has anything to do with tens of billions of dollars in mostly untracked USF subsidies that have gone into the telcos' coffers?

caseywor

join:2004-04-19
Mobile, AL
Reviews:
·Mediacom
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Re: Best quote by Karl Bode is

I would say for the most part it doesn't. Sounds to me like you are claiming that all broadband growth is related to the USF. Kind of s stretch isn't it? Besides, if the USF is "mostly untracked", then it sounds to me like another government mandated black hole, something that should be abolished.

Steve Mehs
Gun Control Is Using A Steady Hand
Premium
join:2005-07-16
Wow, that’s the worst thing my eyes have ever been subjected to reading.
1) The last thing that is needed is the government to have any involvement is in broadband. Let private businesses compete and leave them alone. The government has absolutely no right to say how fast and how much an ISP must sell their service for.

2) I do not so much as one red cent of tax money to toward some ‘Universal Broadband’ nonsense

3) Let’s keep our own routers, so that we, as individuals and consumers have direct control over our home networks. There is absolutely no reason at all for my two desktops, laptop, two PDAs, two smartphones, tablet, MP3 Player, TV, Blu Ray Player, A/V Receiver, two DirecTV DVRs, Xbox 360, PS3 and printer to have their own public IP addresses. And I like the fact I can manage network access of all of these devices from one central location.

Good thing all of your wishes are a pipedream, and thankfully they weill never happen.
--
For the future of our nation, we must unite and vote out the terrorist known as Hussein Obama. Come November 6 2012 we must remove the socialist pig out of office and get our country back on the RIGHT track.
iansltx

join:2007-02-19
Golden, CO
kudos:2
Reviews:
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Re: Best quote by Karl Bode is

Yep. If a local government wants to do FTTH and it gets voted in by its constituents, that's okay. If someone else wants to do a super high speed wireless network, that's fine too. The key here is allowing/pushing everyone to use the resources available to make 'net access more ubiquitous, more reliable and more functional (higher speeds, lower latency, etc.).

To this tune, a government that is less powerful to regulate can't pass statewide franchising for TV services, so U-Verse can cherry pick areas with brazen abandon. That government also wouldn't be able to outlaw a utility from creating their own FTTH network (compare Texas utilities to Chattanooga EPB).

In this same vein, licensed wireless spectrum is great...as long as it's being used. if it isn't, then it's being wasted. Maybe there needs to be a smaller-area "homestead clause" for large region AWS and other licenses such that, if T-Mobile or CricKet won't build out an area of their license, they need to find someone who will.

For "the rest of us", more spectrum like 3.65GHz ("light licensed") would be amazing, particularly at lower frequencies. Less profitable for the US government? Yep, but 3.65 has allowed wireless ISPs to set up cheap, reliable "middle mile" networks at 100+ Mbps (which is a lot in a more rural area) and serve more folks wiht better access than would otherwise happen.

battleop

join:2005-09-28
00000

Re: Best quote by Karl Bode is

"If a local government wants to do FTTH and it gets voted in by its constituents, that's okay."

With the EPB project the constituents (or rate payers) didn't get to vote for anything. Now EPB has a choice. Raise rates to cover expenses or expand into more areas while running more private businesses out of business. They have already raised electric rates to cover the money spent on the fiber network. I guess now that they are moving in to home automation, home networking, hosted pbx, and rumored alarm systems they have chosen to go after more private businesses to make their bottom line.
--
I do not, have not, and will not work for AT&T/Comcast/Verizon/Charter or similar sized company.
sonicmerlin

join:2009-05-24
Cleveland, OH
kudos:1

Re: Best quote by Karl Bode is

said by battleop:

"If a local government wants to do FTTH and it gets voted in by its constituents, that's okay."

With the EPB project the constituents (or rate payers) didn't get to vote for anything. Now EPB has a choice. Raise rates to cover expenses or expand into more areas while running more private businesses out of business. They have already raised electric rates to cover the money spent on the fiber network. I guess now that they are moving in to home automation, home networking, hosted pbx, and rumored alarm systems they have chosen to go after more private businesses to make their bottom line.

Do you actually believe your own lies?

EPB's electric rates were raised to cover the cost of two massive storms that damaged the public electric grid in February: »www.timesfreepress.com/news/2011···ncrease/

The key quote: "Without revenues from the utility’s telecom, TV and video divisions, the rate hike would be at least twice as much, said Harold DePriest, president and CEO of EPB"

Now shut it about EPB- no one wants to hear you spew the same trash over and over again.

battleop

join:2005-09-28
00000

Re: Best quote by Karl Bode is

"EPB's electric rates were raised to cover the cost of two massive storms that damaged the public electric grid in February"

They are using the rate increase to replenish their reserves that was tapped for the fiber build. That money should have never been used for anything but an emergency fund, not to build a fiber network.
--
I do not, have not, and will not work for AT&T/Comcast/Verizon/Charter or similar sized company.
Telco

join:2008-12-19
Reviews:
·Callcentric
100Mhz of spectrum somewhere should be freed up for the use of the community. This way, it leaves enough bandwidth to run LET-advanced at full speed and will not interfere with anything else.

This is a must for anyone who lives in rural areas.
iansltx

join:2007-02-19
Golden, CO
kudos:2
Reviews:
·Verizon Online DSL
·RoadRunner Cable
·Comcast

Re: Best quote by Karl Bode is

LTE and other similar techs work best when a license holder has exclusive rights to that spectrum.

Now, if you're suggesting that 100MHz be offered at a lowish price on a short term, subject to a buildout requirement (you lose the spectrum if you don't build out to 70% of the people it covers within two years, otherwise you have a 7-year license), that could work. Auction off four 10x10 paired allotments (a provider can buy at most two) and one 20MHz unpaired allotment, with a buying power clause that gives businesses already in the community 20% more bidding credits vs. anyone else, and you've got yourself a workable system.
Telco

join:2008-12-19
Reviews:
·Callcentric
You really do live under a rock. We've heard your ilks rant about the private sector and against our government for decades now. 30 years later (i.e. post Reaganomics/trickle-down) and we rank close to dead last in everything but defense; where you guys send close to a trillion a year, with little concern about ROI.

Millions of Americans only have access to less than a few megs broadband speeds, yet you have the nerve (ignorance) to claim we should continue to leave it up to the same private sector that has failed them; that does not deem these Americas profitable enough for them to service.

We need to vote every one of your 18th century TEAnutter ilk out of office and send you back to the swamps. Time for the rest of America, as in those of us who pay for the bills and actually contribute the majority to the GDP (Democrats) to push forward. As in, the uber liberal and world leading San Fran/San Jose area.
sonicmerlin

join:2009-05-24
Cleveland, OH
kudos:1

Re: Best quote by Karl Bode is

said by Telco:

You really do live under a rock. We've heard your ilks rant about the private sector and against our government for decades now. 30 years later (i.e. post Reaganomics/trickle-down) and we rank close to dead last in everything but defense; where you guys send close to a trillion a year, with little concern about ROI.

Millions of Americans only have access to less than a few megs broadband speeds, yet you have the nerve (ignorance) to claim we should continue to leave it up to the same private sector that has failed them; that does not deem these Americas profitable enough for them to service.

We need to vote every one of your 18th century TEAnutter ilk out of office and send you back to the swamps. Time for the rest of America, as in those of us who pay for the bills and actually contribute the majority to the GDP (Democrats) to push forward. As in, the uber liberal and world leading San Fran/San Jose area.

R's are insane, but Democrats are corrupt. After all the current FCC head is Obama's choice- and college buddy/roomate or something.
iansltx

join:2007-02-19
Golden, CO
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Reviews:
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Good luck delivering 100 Mbps, uncapped, over wireless. You'd need more spectrum than is currently available for one company to do this, let alone a couple competitors.

Also, I'm (slowly) trying to get the pieces in place to build an ISP. It won't be 100 Mbps symmetric. It won't be uncapped (though for $100 or so per month the plan is that anything less than 1TB per month is fair game...and for $50 enough usage will be given that 90% of folks won't be throttled or charged). However it will be better than the competition, and it won't be asking for subsidies directly (my bandwidth provider might be subsidized via USF...we'll see). The plan is to sell a level of connectivity that I'd be happy using for my own (power user) activities, which is saying something. But your regulation wouldn't allow me to even get started. How's that fair?

See 6 replies to this post
me1212

join:2008-11-20
Pleasant Hill, MO
"The fascist market has done nothing to improve broadband choices for the USA, and probably will NOT improve for the next 100 years, unless Government tells the fascist market to say:

You the company must provide at least 100 mbps access, for no more than $100 (if government subsidies are needed, so be it) and any device that needs to have internet access, has a public IP address (this eliminates having a router, because if the router fails, one can't share internet access, however for wireless only devices, new equipment will need to be developed,) as well with no caps and/or "usage based billing," otherwise, you can't operate as an ISP in the USA."

Yeah because the government forcing companies to offer and price ceilings always works so very well. Not that what we have now is better, just a different 'evil'.

skeechan
Ai Otsukaholic
Premium
join:2012-01-26
AA169|170
kudos:2
Have the fascists outlaw DSL...then our average will be sky high like these other countries were only urban areas get service.
VerizonCynic

join:2006-10-25
Lakewood, CA

you did not build that lol

this fits in here somewhere

»www.youtube.com/watch?v=hOyDR2b71ag


Taxpayers foot the bill for lots of infrastructure in telecom esp. yet the telcos think they own it and get pissed when we the people regulate it. Really pisses me off. What does Romney say?

Google motto do no evil should also include: dont pig out at the trough and claim its your trough
--
Lakewood Accountability Action Group | »www.LAAG.us | Demanding action and accountability from local government

See 6 replies to this post

caseywor

join:2004-04-19
Mobile, AL
Reviews:
·Mediacom
·AT&T U-Verse

1 edit

Typical BBR article

Once again, Karl isn’t happy with anything. A government entity makes concessions with a company so they can be a part of a huge investment benefiting a large number of people, and it is portrayed in a negative way.

From the article: “A few weeks back we noted how Google's franchise deal with Kansas City for Google Fiber was a particularly sweet arrangement.” - So…..I guess it would have been better if Goggle would have been given very strict, limited terms so as to make it not as beneficial a proposition for Google so they would possibly take their business to another area.

From the article: “Not only does the deal allow Google to walk away from the build in two years if things aren't going well, it allows Google the right to cherry pick markets as they see fit without penalty.” - God forbid that Google invest this money in an area and still try to make sure that they aren’t going to lose money. I always love the term “cherry pick.” Cherry picking is a whiney, negative way of saying a company chose to first go into an area that is initially more beneficial in which to do business, thereby protecting all of the stakeholders in the critical beginning of the venture. So is it better that the company, offering a new, very well wanted service, should immediately jump into areas that are more likely to give losses?

From the article: “To have their city chosen Kansas City was willing to make these concessions, which tells you everything you need to know about how KC (and the thousands of applying cities not selected) felt about the quality of existing services.” - Yes, Kansas City was willing to give concessions, and they are getting a good thing from it, what is the problem?

I love this one: “they didn't get the memo informing them that the free market has failed the majority of the United States broadband market in stellar fashion, resulting in slow, over-priced services in the majority of communities nationwide.” – According to whom? So areas that are not profitable should be forced to have the same service as more profitable areas? This country has a lot of rural areas, and ghettos. Or is it that the taxpayers are supposed to get on the hook for a fully government ran internet service? That would be great, kind of like the well-oiled machine that is the US Postal Service.

See 28 replies to this post

soothsayer

@verizon.net

No Free Market

There has never been a free market in broadband.
It has been a restricted market from day one with
heavy government regulation and restricted entry.

The blaming of a mythical free market is typical
of the statists who deny government culpability.

See 6 replies to this post

Sofa King
Premium
join:2009-03-01
21435

Not a true representation

The net-net is: this R&D project is not representative of an ability to repeat this across the US.

• Cities will want their subsidies to continue (free broadband, TV stations, school equipment, etc)
• Cities will want space, power and construction paid for
• Government will want commitments to under-served areas
• etc

At this point it is an interesting technical project, but anyone that holds it up as a business model should be asked the tough questions.
iansltx

join:2007-02-19
Golden, CO
kudos:2
Reviews:
·Verizon Online DSL
·RoadRunner Cable
·Comcast

Re: Not a true representation

Here's the key though: Google is offering access 20x faster than their nearest competitor, for less off-promo than their cheapest competitor charges on-promo for one-twentieth the download speed (and one-two-hundredth the upload speed). I'm sure many cities would make concessions to keep such a quantum leap in town.

As for free access for anchor institutions, franchises tend to have that clause in there. For Google, since we're talking about a complete FTTH system, these institutions are just another premise. Not a big deal to wire, not a big cost to serve.

As for under-served areas, Google is being very transparent about why they will end up not wiring some neighborhoods out of the gate: they'll have less than 10% (or 5%) market share when they're done. Google is relying on everyone signing up all at once to keep deployment costs per premise low, so they can't afford to go into a community and wire one out of every twenty-five households, who already have cheap broadband from AT&T (via DSL) if they want it. I don't hear anyone in KC complaining about Internet prices on the low end, so that's likely why everyone's okay with Google redlining. It's just a fact of life that a brownfield FTTH overbuild is a bad way to serve customers who aren't willing to pay $50 per month for Internet access of any sort.

Sofa King
Premium
join:2009-03-01
21435

Re: Not a true representation

I think they are doing a great job letting people infer that an ISP can deliver 20x for less than the cheapest competitor. My question is can they actually make a business out of this...
sonicmerlin

join:2009-05-24
Cleveland, OH
kudos:1
The vast majority of consumers care more about price than speed. They won't pay *that* much more for extra speeds.
iansltx

join:2007-02-19
Golden, CO
kudos:2

Re: Not a true representation

Well then, why doesn't DSL have a lot more customers?

LBW

@ameritech.net

the real monopolist

When telecoms sit down to negotiate right-of-way or to obtain permits from a municipality, they put themselves in the position of dealing with a bureaucratic monopolist who has little incentive to reach a socially optimal result. To its credit, Google refused to play this game. By turning its project into a contest between municipalities it took away their monopoly power and forced them to reveal just how valuable this kind of investment is to them.
sonicmerlin

join:2009-05-24
Cleveland, OH
kudos:1

Re: the real monopolist

said by LBW :

When telecoms sit down to negotiate right-of-way or to obtain permits from a municipality, they put themselves in the position of dealing with a bureaucratic monopolist who has little incentive to reach a socially optimal result. To its credit, Google refused to play this game. By turning its project into a contest between municipalities it took away their monopoly power and forced them to reveal just how valuable this kind of investment is to them.

I always wonder whether people like you have ever worked at a large corporation, or realize these giant businesses are rife with their own utterly inefficient and wasteful bureaucracies run by egotistic managers?
VerizonCynic

join:2006-10-25
Lakewood, CA

Re: the real monopolist

said by sonicmerlin:

said by LBW :

When telecoms sit down to negotiate right-of-way or to obtain permits from a municipality, they put themselves in the position of dealing with a bureaucratic monopolist who has little incentive to reach a socially optimal result. To its credit, Google refused to play this game. By turning its project into a contest between municipalities it took away their monopoly power and forced them to reveal just how valuable this kind of investment is to them.

I always wonder whether people like you have ever worked at a large corporation, or realize these giant businesses are rife with their own utterly inefficient and wasteful bureaucracies run by egotistic managers?

How true. My brother worked for Kodak up until 2 yrs ago then started with HP basically they day they folded Palm acquisition. He said he had never seen such bureaucratic inefficient private companies.
--
Lakewood Accountability Action Group | »www.LAAG.us | Demanding action and accountability from local government
rdmiller

join:2005-09-23
Richmond, VA

Power words

According to Elias Sports Bureau, every Karl article since December 3, 1998 has contained either free, freedom, competition or privacy.

battleop

join:2005-09-28
00000

How the hell considered successful yet?

How the hell is this an "example of a successful free market" when they have not even turned up their first user?
--
I do not, have not, and will not work for AT&T/Comcast/Verizon/Charter or similar sized company.

skeechan
Ai Otsukaholic
Premium
join:2012-01-26
AA169|170
kudos:2

Re: How the hell considered successful yet?

Because with the left, it's about "intent" not actual results.
romulusnr

join:2007-08-01
Federal Way, WA

Free market success, definition of

failure is what prompted Google's entry into broadband in the first place, so to applaud it as a free market success story is fairly amusing.
Actually, that's precisely the phenomena that free marketeers say is supposed to happen.

Stick to the subsidy angle.

Alex J

@ptrhosting.com

Re: Free market success, definition of

Actually, that's precisely the phenomena that free marketeers say is supposed to happen.

No, because this is just one market, and it isn't even up and running yet, much less a "success."

KrK
Heavy Artillery For The Little Guy
Premium
join:2000-01-17
Tulsa, OK

It's clearly socialism at work.

Seriously. It is.

wifi4milez
Big Russ, 1918 to 2008. Rest in Peace

join:2004-08-07
New York, NY

1 edit

Another misguided "post"!

Ah yes, and I quickly remembered why I haven't frequented this site much (recently) when I read this gem of news "article". Karl's eloquent description of the "massive" subsidies Google received are the most humorous part. What Karl considers a "subsidy", a business person (aka EVIL profit drive free market conservative) considers a well worked deal. Google very publicly offered the service to any city that wanted it. All those cities each had to decide how much it was worth to them to entice Google to come install their network. Part of ANY deal are the demands one party impresses upon the other. In this case, Google was able to secure free/low cost real estate. AND?? SO WHAT?? Kansas City wanted Google, and this was the deal they struck. Go cry me a river you bleeding heart liberals. If we had it YOUR way then nothing would ever get built. Don't believe me? Take a quick look at where FIOS WAS installed as compared to where it WASN'T installed (cough, looking at you BOSTON, cough). Bottom line is that by opening up and actually inviting business to compete (a shocking concept, I am sure) everyone benefits. By DEMANDING (as some small brained ignoramus did earlier in this thread) that a (given telecom company) "deploy 100Mbps to EVERYONE for $1" (or some absurd amount) the consumers will suffer.
--
"No you won't" -The American people to President Obama (11/2/2010)

Skippy25

join:2000-09-13
Hazelwood, MO

Re: Another misguided "post"!

Right... "nothing would ever get built" because companies will just close up shop and stop doing their core business if their demands arent met.

And actors wont act, singers wont sing, artist wont paint and doctors wont "doctor" if we don't give them everything they think they are entitled to and then some.
FLATLINE

join:2007-02-27
Buffalo, NY

The only reason for government freebies.....

Its because the government has been taxing the shit out of us. They have all the money and the promise of more. Its about time they financed something worthwhile even if its just part of it.

Zeety

@98.156.61.x

Google fiber

So much herpty derp. Move to Kansas City if you want it. Stop whining

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