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Google Fiber Downsizing Not Confirmed

Mari Silbey
8/25/2016
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A sexy story like the news that Google Fiber may be getting gutted in a massive downsizing effort will get headlines all day long. But there's a problem when that news only comes from off-the-record sources.

Earlier today a report by The Information (subscription required), suggested that Alphabet Inc. is set to cut staff at its Google Fiber Inc. division by half, drawing the employee count down from about 1,000 to roughly 500 people. The report further said that Google Fiber had hoped to attract 5 million customers in its first five years, but that the actual subscriber total today hovers at around only 200,000 after two years.

However, a source with direct knowledge of the situation has now responded to Light Reading about the report by saying these claims of drastic job cuts at Google Fiber are false.

Unfortunately, no official comment from the company has been forthcoming, so our tally of on-the-record sources still stands at precisely zero.

Google Fiber has been criticized for moving slowly with new market deployments, but it's been difficult to find reliable data on the company's actual Internet subscriber numbers. Earlier this year, the U.S. Copyright Office reported that Google Fiber had only 53,390 video subs at the end of 2015. Although not representative of broadband customers, that report may have been an indicator of overall low adoption. (See Gigabites: In TV, 15 Google Fibers Make One Mediacom.)

In a more recent twist to the saga, Google Fiber has notably postponed some of its planned gigabit rollouts, including deployments scheduled for Portland and Silicon Valley. The theory there is that the company is investigating wireless technology as a possible alternative to its fiber-to-the-home Internet strategy. (See Google Looks to Test 3.5GHz Broadband Radios and Gigabites: Anchor Institutions Aim High.)

Google Fiber has been steadfast in maintaining that it is committed to the Internet service provider market despite its measured pace. The company also has the luxury of moving as slowly as it chooses given the deep pockets of its parent company.

In the end, the success or failure of Google Fiber will have to be judged through a longer lens. In the short term, any analysis is mostly guesswork.

— Mari Silbey, Senior Editor, Cable/Video, Light Reading

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tyrellcorp
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tyrellcorp,
User Rank: Light Beer
8/27/2016 | 12:33:26 PM
Re: Google Fiber PR Needs to do a better job here.
When has Google ever responded to rumors.... Never have seen it
mendyk
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mendyk,
User Rank: Light Sabre
8/26/2016 | 11:08:27 AM
Alphabet city
There's probably more and less to this story than we're considering. If Alphabet is squeezing Google Access (I think that's what they're calling Google Fiber now) on costs, then what does this mean for the days of spare-no-expense R&D initiatives at the company? Regarding measurable progress, Googlebet FiberAccess hasn't gotten very far in building out networks, let alone getting customers or, you know, making money.
KBode
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KBode,
User Rank: Light Sabre
8/26/2016 | 10:44:41 AM
Google Fiber PR Needs to do a better job here.
Google Fiber PR is not getting out ahead of this story very well. I too was informed by a source that the layoff claims were false and the stroy had a lot of errors, but the company itself wouldn't comment on the record. Seems like a mistake to let this stuff gather steam, unless there really is some truth to portions of it.

 

I think it remains possible they're just reanalyzing the entire business now that wireless is showing more promise and they just bought Webpass. May just be taking stock of what they have.
Sean2011
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Sean2011,
User Rank: Light Beer
8/26/2016 | 10:14:38 AM
Goal of Google fiber
I agree with Ray. No matter what happned to Google fiber, it already achieved a lots. See all those telco all trying to pump up their broadband now. I believeit is not google's intention to get into telco's dialy business. But they needpsuh for more connectivity and they need to tryout more cloud computing with better performance at input side. I think there are the two main goal of Google fiber.
msilbey
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msilbey,
User Rank: Blogger
8/26/2016 | 9:22:32 AM
Re: Why does Google Fiber exist?
This is an ongoing debate - whether Google cares about being in the networking business if it's successful in pushing the rest of the market to upgrade. I think Google does care because there are a lot of knock-on benefits to working in the network infrastructure space - development of new technologies, new partnerships, new circles for schmoozing - all of which feed back into and expand Google's core software businesses.

The benefits would hardly be worth the capital expense for most companies, but Google/Alphabet isn't most companies.
Alison_ Diana
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Alison_ Diana,
User Rank: Light Sabre
8/26/2016 | 9:18:34 AM
Re: Why does Google Fiber exist?
Those are great points, @Ray. Then you have to add into the mix that Google often plays the big picture and long term, frequently willing to lose money in the short (or even middle) term if a project fits its ultimate idea. That said, as you wrote, Google doesn't control the entire ecosystem so other factors impact and change the environment, perhaps recasting Alphabet's vision and stepping-stone projects like GF.
Ray@LR
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[email protected],
User Rank: Blogger
8/26/2016 | 3:07:11 AM
Why does Google Fiber exist?
It might be worth considering why Google Fiber exists. What is the main aim of Google/Alphabet in having such an operation?

I don't think it is to try to build a viable standalone FTTH business -- it doesn't need to do that.

What it does WANT is for the market in general to be building out higher-speed broadband connections and that's happening much more now than before Google Fiber existed.

It also, I believe, wants distributed facilities in towns and cities that connect to its core data centers and enable a distributed cloud architecture. Even if Google Fiber as an operation gets the brakes put on it a bit (and that's clearly an 'if' until something actually happens) I don't expect that requirement will change.

So even if Google Fiber 'downsizes', I don't expect the main aim or raison d'etre for the operation will change.

And obviously, I hope 500 people are not going to lose their jobs....  
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