Google's fiber initiative is almost exactly nine years old. Following its embarrassing setback in Louisville, here's a look back at Google Fiber's moments of hype, glory, achievement and disappointment.
![Google Fiber: A timeline of the good, the bad and the ugly Google Fiber: A timeline of the good, the bad and the ugly](https://eu-images.contentstack.com/v3/assets/blt23eb5bbc4124baa6/bltf3253c29056fe0aa/64885212c62638785f0518fc/LR_generic_image.png?width=850&auto=webp&quality=95&format=jpg&disable=upscale)
It might be hard to believe that almost a decade has slipped by since Google introduced what was then billed as an "experimental fiber network" that would not only deliver speeds of 1 Gbit/s to the home and explore new bandwidth-intensive services and applications, but also be "open" to other service providers.
While Google's notion of an "open" network didn't take shape, Google Fiber Inc. has gone well beyond an experiment, as it followed with expansions to many more and teamed baseline broadband service with pay-TV and voice offerings, and later extending service to business customers.
When Google Fiber came on the scene, it drew lots of fanfare, generated plenty of hype, and raised many questions. Will it be turned into a bona fide, profitable business? Is this being done to prod cable operators and other ISPs to move more rapidly into the 1-Gig era and provide plenty of capacity headroom for Google's long-rumored OTT-TV service and other bandwidth-heavy apps? Something else? All of the above?
Whether it was by design, Google Fiber has most certainly had something to do with the pace at which 1-Gig broadband was deployed by others, whether it was telcos like AT&T or the US cable industry. Per the NCTA – The Internet & Television Association , speeds of up to 1-Gbit/s (in the downstream direction, anyway) is available today across 80% of the US via cable networks, up from just 5% in 2016. It's hard to say how much credit for that pace should be given to the specter of Google Fiber, but it gets plenty in my book, even as cable now starting to push toward symmetrical 10-Gig speeds. (See CES 2019: Cable's 10G Tech 'Will Work'.)
As for being a business, Google Fiber is still lumped in with parent company Alphabet Inc. 's "Other Bets" unit, which saw full-year 2018 revenues rise 25%, to $595 million (thanks mostly to Google Fiber and Verily, a research group focused on the study of "life sciences"), while the operating loss for the year widened to $3.4 billion, from $2.7 billion in 2017. Accrued capital expenditures for the year at Other Bets was $181 million in 2018, down from $493 million in 2017, "primarily reflecting investments in Fiber," Ruth Porat, CFO of Alphabet and Google, said earlier this month on the company's Q4 earnings call.
Early on, Google Fiber's hype train did capture lots of attention, imagination and criticism with its savvy, demand-driven "Fiber Rally" deployment model and disruptive 1-Gig price points. Hundreds of cities around the nation clamored to be the first to get Google Fiber, and others were likewise excited when they were included in Google Fiber's ambitious expansion plans.
Figure 1:
But Google Fiber also came up against the challenges of building and operating a wireline broadband business that others already in that market, including cable operators, expected Google to encounter, with high costs and regulatory hurdles and burdens chief among them.
The technology part of that challenge reared its ugly head this month, when Google Fiber announced it would pull out of Louisville on April 15 after discovering that its testing of shallow trenches for fiber, key to its deployment plan for that particular market, did not pan out. Google Fiber noted in this blog post about the situation that it would have to "essentially rebuild our entire network" to provide the service it envisioned, and ultimately decided that going to such lengths would be a bad business decision. (See Google Buries Louisville Fiber Plans.)
While Google Fiber was not that far along in the Louisville deployment, the pullback wasn't a good look, amplified by a report that Louisville city leaders were "taken by surprise" by Google Fiber's decision and even tried, to no avail, to urge Google to stay and compete with incumbents AT&T and Charter Communications. This also wasn't the first time Google Fiber didn't go through with its plan in a given market because of build-out problems. In the fall of 2014, for example, Google Fiber and Leawood, Kan., scuttled an agreement forged about a year earlier because of construction issues that Google discovered. That opened the door for a new agreement between the town and AT&T.
The Google Fiber story is far from done, as it stressed that the decision in Louisville will have no impact on its other markets, where it continues to serve and add customers.
Despite a promising and ambitious start and a sizable list of accomplishments that followed, Google Fiber has also had its share of fits and starts and disappointments, and arguably has fallen short of where it was expected to be almost a decade after it threw down the gauntlet. It's not an easy business.
Here's a look back at highlights, important moments, and a few low points of the Google Fiber era (so far).
Next Page: February 2010: Google enters the gigabit game
February 2010: Google enters the gigabit game
I remember it like it was yesterday. Our now-retired colleague Carol Wilson emailed a link to a Google blog post to the entire Light Reading editorial staff, asking if any of us had heard about this Google fiber-to-the-home thing.
Seemingly out of the blue, Google had unleashed a 1-Gig FTTH initiative, labeling it as an "experimental" project. At the time, it gave all interested cities a few weeks to fill in and send in an RFI explaining why they should be picked as the first Google Fiber city. (See Google Jumps Into Gigabit FTTH.)
Perhaps the video posted by Google, which at the time suggested that the "trial" networks would be open to other service providers and perhaps serve as many as 500,000 users, will bring back some memories:
So what is Google really up to here?
After Google's announcement, anybody and everybody had an opinion about Google's intentions. Was it truly a little experiment? Did they have bigger plans? Is this Google trying to push cable operators and other ISPs to accelerate their 1-Gig network upgrades that provide some big pipes for Google's then long-rumored virtual MVPD on which to ride? (See Google's Pointy Stick.)
Hindsight being 20/20, one could argue that it had something to do with all of those things. (See Google's Pointy Stick.)
Cable operators we spoke to privately then were wary but not overly concerned because, they argued, Google didn't have a full appreciation of what it was getting into, nor did it have the expertise and experience to navigate the regulatory red tape it would need to slash through. I imagine there's some told-you-so's being said today and some schadenfreude being spent. The NCTA, meanwhile, was happy to point out then that US cable, at the time, had already spent $161 billion over a period of 13 years building out its national broadband footprint. Back then, DOCSIS 3.0 was still in the early phases of deployment, and D3.1-fueled gigabit services were still several years away. (See Comcast Enters the Wideband Era.)
March 2010: Cities go ga-ga for Google Fiber
There was no shortage of cities that wanted Google to pick them as their first and, for all we knew then, only Fiber city. Hundreds of cities, including my town of Highlands Ranch, Colo., entered the flirtation fray, with Topeka, Kan., going so far as renaming itself "Google" temporarily. Songs were written to win over Google. We even suggested that The Tubes should rewrite the jingle they created for Activision's Megamania game for the Atari 2600 as homage to the frenzy that Google had stirred up. (See My Town Wants Google 1-Gig! and Googlemania!)
Alas, it quickly dawned on me that Highlands Ranch's pitch wasn't cool enough and, therefore, had no shot. (See My Town Won't Get Google's 1-Gig.)
March 2011: We have a winner!
Following delays and a review of nearly 1,100 applicants, Google announced its selection about a year later -- Kansas City, Kan., and later agreed to expand into the Missouri side. One of the big selling points was that the city's existing infrastructure would help Google get its project running up rather quickly and launch services the following year. Google even hinted that it would be looking to expand to other markets around the country. (See Google Delays Fiber Picks and Google's 1-Gig Fiber Winner: Kansas City, KS.)
July 2012: Bundling up, rallying for fiber
Google Fiber released details of the services and pricing it would roll into Kansas City. Presenting some potential disruption to the broadband market, Google Fiber led with a $70 per month, data cap-free 1-Gig service, or a Gigabit+TV bundle starting at $120 per month. It also tossed in a Nexus 7 tablet. Google also waived a $300 "construction fee" when customers took a one- or two-year contracts. And anyone who paid that fee was in line for a 5 Mbit/s down by 1 Mbit/s upstream service for no extra cost for at least seven years.
Google also announced the concept of dividing the market into "fiberhoods" alongside a weeks-long "rally" in which consumers would pre-register for service. Fiberhoods that rallied the hardest would be placed further up in the line, and those that fell short might not ever get Google Fiber to come their way. Advocates saw this as a savvy, demand-driven business model; critics of the method viewed it as a form of redlining.
August 2012: Google Fiber's sweetheart deal in KC
Some interesting details tied to Google Fiber's franchise agreement with Kansas City started to surface, as Light Reading was first to learn that there was a clause therein that would let Google terminate its agreements with the city two years after it started building the networks. There were no signs to indicate that Google Fiber would exit the market, but it was eye-opening to discover that such a provision was baked into the agreement. (See How Long Will Google Keep the Fiber Flowing?)
"They [the cities] wrote a franchise that no cable operator could have possibly gotten when franchises were being argued over and fought over in the 1990s and 2000s," Steve Effros, a veteran cable lobbyist with a deep understanding of franchise rules, said at the time. "The franchises operators have today are far more restrictive than this thing they've given to Google." (See TWC Wants Piece of Google Fiber's Sweet Deal.)
He also remarked then that Google's early idea of opening up access on the network magically "disappeared before they even dug their first trench."
November 2012: Google starts to connect customers
As it neared the three-year mark on the intro of the project, Google Fiber began to connect homes to its 1-Gig network in Kansas City, Kan., with Hannover Heights being the first fiberhood to get access to Google's new broadband and TV services. (See Google Fiber Starts to Hook Up Customers.)
December 2012: It's a business... not an experiment
Google labeled its FTTH project as an experiment early on, but execs later began to declare that it was more than that once services were launched. "It's actually not an experiment; we're actually running it as a business," Eric Schmidt, Google's executive chairman at the time, said at a conference. (See Google Fiber's Non-Experimental Experiment.)
April 2013: Austin is a go for Google Fiber
Austin, Texas, was officially named an expansion city for Google Fiber, the first outside the Kansas Cities. (See Austin Gets Google's Next Fiber Gig.)
July 2013: Google builds and buys
Adding a new wrinkle to its rollout plan, Google Fiber put the finishing touches on its takeover of the iProvo Network in Utah. Google locked in the original deal for $1, but with provisions that it would complete the network buildout there and attach a bunch of local public institutions, and supply a free 5 Mbit/s service for up to seven years.
Next Page: 2015-2016: Analysts don't see eye-to-eye on the Google Fiber threat
2015-2016: Analysts don't see eye-to-eye on the Google Fiber threat
As Google Fiber started to bring revenues in the door, industry analysts were not in lock-step with respect to how serious a threat Google Fiber posed to cable operators and other broadband ISPs. Some were bullish and bearish. Carlos Kirjner, then an analyst with Bernstein Research who joined the Google finance team under CFO Ruth Porat in 2016, was on the bullish side.
He held that Google was playing a "very long game" with Google Fiber, and used the "boiling frog" analogy to describe the competitive impact it would have on incumbent broadband service providers -- once they realized they were getting killed, it would be too late. In the fall of 2015, he likewise argued that the the market was "too dismissive" of Google Fiber, and that it had a decent chance to become a profitable rival based on some door-to-door research conducted in some of Google Fiber's markets. At the time, he believed that Google Fiber was positioned to snare up to 50% of the market in its still-limited service footprint.
This was back when it was primarily offering service in the Kansas Cities and Provo, Utah, and the cities it was considering for expansion then represented just 4.3 million homes. Still, he warned incumbents from getting too complacent, as he speculated that Google Fiber could spread its reach to 15 million to 20 million homes within the next six to eight years.
On the other side of the spectrum was MoffettNathanson LLC 's Craig Moffett, who regularly shook his head at all the attention and hype being lavished on Google Fiber, whose scale was still small potatoes.
The early numbers backed up that stance. In March 2016, Moffett, using data from the US Copyright Office, discovered that Google Fiber ended 2015 with a mere 53,000 video customers, up from 28,867 a year earlier -- and clearly a subset of a larger (and not disclosed) number that were getting broadband from the provider. Still, the sub numbers were "astonishingly low," Moffett wrote at the time, noting that Google Fiber then was about 1/7th the size of Cable One Inc. , the smallest cable operator he was covering.
That data, he noted, "is a useful barometer of just how slowly all this happens, and just now tiny Google Fiber remains in the grand scheme of things."
January 2015: Expanding on expansion
In a move that seemed to say, "Hey, we think this can be a business," Google Fiber announced it would scale up its expansion into as many as 18 more cities in four metro areas -- Atlanta, Ga.; Charlotte, N.C.; Nashville, Tenn.; and Raleigh-Durham, N.C. It also started to size up possible moves into Phoenix, Portland, Ore.; Salt Lake City, Utah; San Antonio; and San Jose.
February 2016: Google Fiber makes it with a muni
Adding yet another facet to its deployment game plan, Google Fiber announced it would provide services in Huntsville, Ala., via a network owned and built by the local municipality. Google Fiber began to sign up customers there in May 2017. (See Gigabites: Google Fiber Seeks Custom Fit and Google Fiber Launches in Huntsville.)
March 2016: Google Fiber gets the triple-play
Google starts to phase in Fiber Phone, a home voice service that enables Google Fiber to broaden its bundle. And it was fairly cheap -- $10 per month for unlimited local and nationwide calling.
July 2016: Google Fiber means business
After focusing on the residential market, Google Fiber officially began to target small businesses with a set of service plans.
October 2016: Google buys Webpass
Foreshadowing its thoughts on the expense and red tape that comes with building fiber networks, Google Fiber closed its acquisition of Webpass, a San Francisco provider of point-to-point wireless broadband services that was offering service in a handful of major US cities. (See Google Fiber Now a Wireless ISP!.)
October 2016: Google Fiber scales back
In a surprising setback and proof that Google didn't have a bottomless pocketbook, Google Fiber did a layoff and hit the pause button on most of its plans to expand into more cities as it looked to explore other, less expensive technological approaches, including wireless. And Craig Barratt, CEO of Alphabet's Access unit, announced he was leaving. Google Fiber doesn't reveal sub numbers, but MoffettNathanson estimated that the unit ended Q2 of that year with about 453,000 broadband subs and 69,000 video customers. (See Google Fiber Hits Pause Button, Scales Back.)
December 2016: Frustration mounts
In the wake of the pause on new market expansion, Bloomberg ran a story about how Alphabet CFO Ruth Porat was trying to bring more financial discipline to the company. And that discipline reached into longer-term "moonshot" projects like Google Fiber. The story also suggested that Alphabet CEO Larry Page had grown tired and frustrated with Google Fiber's apparent lack of progress…and pizzazz.
"Larry just thought it wasn't game-changing enough," a former Page adviser told Bloomberg. "There's no flying-saucer shit in laying fiber."
Google Fiber apparently had lost some of its sheen.
October 2017: Google Fiber goes Internet-only in two markets
In a shift in strategy, Google Fiber said it would only offer Internet services for its planned deployments in Louisville and San Antonio. Of course, those customers had plenty of OTT-delivered TV options, including YouTube TV, a service that was launched in a handful of markets just a few months earlier that year. So, meh to that.
January 2018: Backing out of Boston
Google Fiber's pull out of Louisville grabbed a lot of headlines, but it's not the first time that the company had backed out of a market. Google's Access unit announced then that it was winding down Webpass operations in Boston following a review of its business in that market. The pullback there came about a year after Webpass founder, Charles Barr, left the company.
January 2018: FCC committee offers some help
During its ongoing buildout, a major issue Google Fiber dealt with was getting access to city infrastructure and battling resistance from incumbents with respect to pole attachment negotiations. A committee at the FCC tried to ease some of that pain by recommending a One Touch Make Ready policy that would, under the right conditions, enable a new player to proceed with installs after a 25-day review window. The FCC approved a streamlined process for broadband and 5G small cells in August 2018. (See FCC OKs Faster Access to Utility Poles for Broadband, 5G Good News for Google at the FCC.)
February 2018: Revolving door at access finally stops
Stability of Google Access's leadership was a bit shaky for a while. Greg McCray, the former CEO of Aero Communications and former member of the CenturyLink Inc. (NYSE: CTL) board, took over for Craig Barratt, but didn't last half a year in that job. That led to the hiring of Dinni Jain, a cable industry vet late of Time Warner Cable and Insight Communications, who has been in that role ever since. (See Google Access Names Dinesh Jain CEO.)
Much has happened with Google Fiber over the past nine years. What other big or important moments did we miss? Google Fiber's story is still being written, so what do you think its future will hold? Chime in on the message board below.
— Jeff Baumgartner, Senior Editor, Light Reading
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