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How Google Hopes to Liberate America From Cable Captivity

Let's face it: the United States is being held. This is a law professor Susan P. Crawford makes the case in her book captive audience, describes the current monopoly of the telecommunications industry.
When it comes to the Internet, technology has been the undisputed completely changed the world and the global economy, the United States is lagging seriously behind other countries. We are talking about the technology created by the United States, but the average American be transferred to other parts of the world compared to inferior speed, and many rural areas do not even have broadband service.
A sad status quo,
In many ways, Internet access, can be considered nowadays the necessary tools, like electricity. Unfortunately, the people who can afford to pay too much, and there are still a large chunk of the population can not afford it at all.
One of the reasons for this sad status of the industry itself needs an oligopoly structure. Not everyone can afford to spend $ 19.7 billion of infrastructure, which is AT & T Inc. (NYSE: ?) decline in capital expenditure last year, in addition to the $ 20.3 billion spent in 2011.
Along the way, the industry is divided into wired and wireless industry Comcast Corporation (Nasdaq: CMCSA) and Time Warner Cable (NYSE: TWC) based wired side, and AT & ? and Verizon (NYSE : VZ) wireless call the shots.
Wired connection, most of the network across the country have built the old copper wire. Some companies have established a high-speed fiber-optic network, but this is an expensive upgrade. Verizon began building its FiOS network in 2006, but later reversed course and will not expand beyond its current obligations. Not worth the investment FiOS, as it is still hard to compete with.
Unless the consumer uprising, cable is currently investing heavily in fiber-optic network, little incentive they could otherwise hinder competition.
Go to the Google (NASDAQ: GOOG) fiber.
Liberation!
The Gigabit fiber of the search giant pledge connection speed of up to 100 times the average American, on behalf of the real subversive threat to the wired telecommunications sector.

Source: Google.
So far, the company has a major push into an Internet service provider, or ISP, mostly been relegated to in Kansas City, across the state line between Kansas and Missouri. Kansas City a little more than 60 million people, with both sides. The company has just announced plans to expand its service Austin in Texas, deep in the heart of Google Fiber. Live music capital of the world, with a population of more than 820,000.
For Google fiber within the growing footprint lucky residents, compared with existing products, a no-brainer. Google is not yet complete pricing in Austin, where I live, but I currently pay about $ 60 before taxes per month Time Warner Cable for 20 Mbps connection. Kansas City's pricing is $ 70 per month Gigabit (1000 Mbps) connection. My speed increased by 50 times, an additional $ 10 per month, or 17%? You do not even have to ask?
Google fiber mid-2014 available to me, I will decline rapidly, Time Warner, and I think my fellow Austin's army will follow.
At a minimum, the incumbent will be forced to take action to respond to new competitive threats. A few hours later, Google announced, AT & T announced the intention to build its own gigabit fiber network, the time in the city. Mabel that there is no pricing or timing, but apparently is relevant, as it should be. AT & T will expand if it can get Google on the same terms and incentives.
Currently, AT & T's U-verse network operating mixed run through residential areas in Austin, but the main line of fiber-optic cable running house to copper. I changed the U-verse Time Warner Cable years ago, I met some performance issues. Two weeks ago, the company sent trying to win my U-verse. My response is it? "Come back, when you create a complete fiber-optic network, I want to switch." This is a true story, maybe I should be ready to be accessed again.
The final results of the competition will be the consumers will eventually get a faster connection, and the monthly bill is only a moderate increase. No matter how you analyze it, to win consumers.
Patience is a virtue
However, Google's liberation will take time. Kansas City and Austin, which is only 1.4 million people in the metropolitan area, 315 million Americans in the United States, or less than 0.5%. Even in these cities, not everyone is covered "rollout is slow and expensive.
Analysts estimate that the first wave of the Google network investment will run $ 84 million, reaching nearly 15 million households this year in Kansas City. Large scale expansion may increase to 30 million households doubled to around $ 170 million cost. National marketing costs could be as high as $ 1.1 billion U.S. dollars. Google does not specify, it will start in Austin, but said it would start to measure interest in and began to neighborhoods with high interest rates.
It is now more than two years, because Google's first Google Fiber announcement. The list is only two areas, perhaps cable suppliers are not considered to be an imminent threat. They may be right. Consumers need to start speaking out on slow speed and high prices for fostering change.
Give me freedom, give me a gigabit fiber service.
As one of the most dominant Internet companies, Google has done a habit, driven by strong returns for its shareholders. However, like many other Web companies, it is also trying to adapt to an increasingly mobile world. Despite its Android operating system has gained an enviable lead may not be sold. That is why it is more than ever more important to understand Google empire, every one. The Motley Fool's Google's new high-quality research report, we broke Google investors of the risks and potential returns. Just click here now to unlock your copy of this valuable resource.
 
 



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