City Hall

Google Fiber Shows Cities Want Faster Networks

By Glenn Fleishman March 30, 2010

Google put out a call six weeks ago for cities between 50,000 and 500,000 ] residents to tell the firm why it should choose their community to build a 1-gigabit-per-second fiber optic network at the company's expense. (See "Google Plans to Test Superfast Broadband Networks.") Unless Google opens the contest up to additional cities, only one community will be chosen.

Eleven hundred cities applied by last Friday's deadline, including Seattle and Portland.

That's a remarkable number. It also reveals how hungry communities are for a robust broadband infrastructure that would let them compete at an international level. Sure, the fact that Google would pay for the network is the cherry on top, but that's not the only reason there was such an overwhelming response.

Few cities have more than downtown business segments set up for routine speeds faster than 50 Mbps. Verizon, Comcast, and a few other cable providers offer 100 Mbps options for extremely high prices in limited areas.

Fifty Mbps isn't a magic number; it's just easier to reach than higher speeds, which also come with higher expectations. The equipment costs aren't that much higher for 100 Mbps. Providers simply tier their service to capture higher revenue and higher margins from those who think they need faster speeds.

Google's call for proposals coincided neatly with Verizon's announcement that it would halt expansion into new markets for its fiber-based FiOS service. The company will keep building out in existing areas where it already has television-service licenses, but won't be moving into new markets for the foreseeable future.

That spells market failure all over. Cities want vastly higher speeds at affordable prices. Cable firms and telcos have put an effective cap on what they're offering for now, and the only fiber-to-the-home firm, Verizon, has capped its market size, too.

All these developments make it more likely that we'll see efforts to duplicate Lafayette, Louisiana's apparent success in the first generation of its fiber-to-the-home network that will be complete in just a few more months.

Seattle has a plan that's apparently being dusted off, although I haven't heard of much motion since Mayor Mike McGinn took office. With 1,100 communities saying they want fiber, and a model to replicate in Lafayette, I wonder if there will be an explosion of proposals after Google picks its anointed city.
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