Uncommon Wisdom

Feb 11 2010   2:51PM GMT

Misinterpreted Google broadband test jolts telecom industry

Tom Nolle Tom Nolle Profile: Tom Nolle

In the latest of many moves that the media and industry are apparently determined to misinterpret (probably with some encouragement from Google), search giant Google is being portrayed as the next provider of high-speed broadband. What’s in the details is more modest: Google is asking municipalities to participate in trials of fiber to the home (FTTH). While it is being painted as a provider of broadband that will be 100 times the speed of “many” broadband connections, it’s clearly a proof of concept just as a similar move with WiMAX was.

We think it’s just as clear that Google will never be an ISP as it was that it would never be a mobile carrier. What Google is doing is much more complicated:

  • First and foremost, Google wants to prove to the FCC and regulators that it is possible to deploy ultrafast Internet (as long as it don’t have to do it itself). That would encourage setting higher rate standards for basic broadband.
  • Second, Google wants to introduce the risk that some competitor just might try to employ –the technology approach Google will demonstrate to offer a real service. That could create the classic arms-race mindset among ISPs.
  • Finally, Google wants to make people dissatisfied with current speeds and demand better, even if what they get doesn’t change current technology or even approach the heady speeds Google will try with its FTTH testing.

This is exactly the kind of move Google made with wireless auctions in the U.S., that it has made with its Android handset strategy, and that it will continue to make. Big Internet means Big Google.

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