Atlanta and eight other local cities are candidates for Google’s new, ultra-fast fiber optic Internet and television service, the Silicon Valley giant announced Wednesday.
The service, called Fiber, operates at 100 times the speed typically delivered by cable companies today, and at a competitive price. That makes it possible to seamlessly stream HD content or download a feature-length movie in a few seconds. The more devices you’ve got running in your home, the more likely you’d be to notice a big improvement in performance with Google’s 1-gigabit-per-second service.
The company’s timing is either lucky or highly strategic: It comes amid hand-wringing over Comcast’s bid to acquire Time Warner Cable, further collapsing the already slim number of cable Internet providers. By going public with its plans to evaluate 34 key markets nationwide as sites for Fiber, Google also creates buzz around what some onlookers have hailed as a serious challenge to existing providers like Comcast.
“Google is really out of the gate doing something different that is hard for incumbents,” says Ron Hutchins, Georgia Tech’s chief technology officer.
(Full disclosure: Cox Enterprises, which owns The Atlanta Journal-Constitution, also operates a cable business but does not provide service in Atlanta. In response to Google’s announcement, Cox spokesman Todd Smith said: “As the leader in the markets we serve, we have a long history of offering customers what they need ahead of demand. We’ll continue to aggressively compete in Arizona — the only market that we serve that Google has announced intentions to enter — and all our markets …”)
Hutchins’ “something different” is a radical upgrade of the fiber optic networks in the markets Google Fiber enters. Where Google believes the market conditions are right, it’s willing (and able) to supplant what has been a gradual, piecemeal evolution away from traditional copper transmission lines with a build-it-today strategy.
Depending on how many cities Google chooses, the cost could well be measured in billions. To make that investment worthwhile, Google is looking for two main things: a reasonably hospitable physical environment and a city government willing to help in a big way with logistical things like detailed maps and expedited permits.
In the few markets where Fiber currently exists –Provo, Utah, and Kansas City, with Austin up next — Internet service costs $70 a month, and Internet plus TV is priced at $120. The up-front “construction fee” and equipment charges can run to several hundred dollars, although Google waives most of that if the customer keeps the service for a year or two.
In addition to Atlanta, local cities under consideration are Avondale Estates, Brookhaven, College Park, Decatur, East Point, Hapeville, Sandy Springs and Smyrna. Across the county, Google is looking at a mix of major cities such as Phoenix and Portland and smaller communities such as Chapel Hill, NC, and Palo Alto, Calif.
Over the next several months, a team of Google engineers will visit here, seeking to define the complexity of installing a fiber optic network underneath the streets and on utility poles in the various cities.
They’ll take soil samples, assess the existing utility cables and measure the height of the water table in specific to make sure they can prevent fiber optic lines beneath the earth from getting wet, among other things.
City officials will have until the beginning of May to provide Google with detailed maps of their infrastructure, as well as proposals for a process to let Google apply for hundreds of construction permits at once. Officials got a heads-up last week, according to a Google spokeswoman.
Google insists it’s not looking for tax breaks or other financial incentives, and that the cities are not in competition with one another.
There are good reasons for Google to look favorably on Atlanta. It’s a major transportation hub, mostly thanks to the airport. It’s a major population center, as well as an up-and-coming agglomeration of innovation, an effect of the incubation occurring at Georgia Tech. And buried beneath it lies one of the nation’s largest fiber optic trunk lines.
In connection with Wednesday’s announcement, Google Access General Manager Kevin Lo also touted the urgency Atlanta Mayor Kasim Reed brought to the business of attracting high-tech companies.
The mayor declined to chat over the phone about what Fiber would mean for Atlanta. In a prepared statement sent by email, Reed said the city’s government is excited about the possibility of the Google Fiber service making its way to Atlanta.
“Ultra high-speed Internet service will strengthen our economic development opportunities and set our citizens up to succeed in our hyper-connected world,” the statement said.
Out of the gate, Google Fiber would serve only residential customers. But over time, some of the biggest beneficiaries might be small and medium businesses and startups, said Roger Tutterow, an economics professor at Mercer University.
“I think if, in fact, we were able to get access to get faster Internet traffic, such as Google Fiber, it would contribute to Atlanta as a destination of e-commerce,” Tutterow said.
“In the business of shipping product you want to have the deepest port and access to the most vast rail lines, but if you are in the business of producing and transmitting information, (Fiber) gives you competitive advantage.”
A few Atlanta neighborhoods are likely candidates for gigabit speeds, even without Google’s aid.
North American Properties’ $600 million Avalon project in Alpharetta is installing fiber-to-the-premises Internet with the idea that it can pitch the amenity to office tenants, residents and hotel guests.
Midtown Atlanta business leaders have long salivated over the idea of tapping into the fiber optic trunk line that runs across the city, according to previous reports.
And officials with Invest Atlanta and the Atlanta Beltline have said they’re exploring ideas for high-speed service along the corridor as a way to attract high-tech companies.
Such investments can bring a measurable bump in property values.
In Kansas City, Kan., homes that are hooked up to Fiber list for $3,000 to $5,000 more than ones that aren’t, the city’s mayor, Mark Holland, told the AJC in October.
As for Google, the company can profit both directly and indirectly, Hutchins said. For instance, just goading cable companies into providing faster Internet service would theoretically entice people to use the net more. That means they’d use Google more, and Google could charge more more for advertising, he said.
Lo said Fiber’s aim is to simply move the web forward.
“We’re Google Fiber. Google Inc. has a lot of businesses,” he said. “We’re a service provider, we provide Internet services.”
The Mountain View, Calif., company is coy about the cost of building a dense fiber optic network in Atlanta or any other market. Business Insider estimated the price tag of the Kansas City network at just under $100 million.
It’s clear, in any case, that Google has the deep pockets to make the project happen. At the end of last year, Google had almost $59 billion on hand.
The company expects to decide by the end of the year whether or not to bring Fiber to Atlanta.
Staff Writer J. Scott Trubey contributed to this report.