Google Broadband Play Pushes Network Neutrality in Google's Favor
Google's bid to build high-speed broadband networks may be just a test, but it's geared to swing network neutrality more closely in the search engine's favor. Gartner analyst Alex Winogradoff said this is the company's latest move to federate data access among carrier's data networks. With open networks as alternatives to private networks from Verizon and other carriers, Google wouldn't have to deploy 20 to 30 data centers around the world to alleviate data latency and improve service quality for its search engine and other Web services. BroadPoint AmTech analyst Ben Schachter also crunched some numbers and guessed the test could cost Google $60 million to $1.6 billion.Google's pledge to build high-speed broadband networks may be just a test, but it's geared to swing network neutrality more closely in the search engine's favor, some industry experts believe. Google Feb. 10 said that it will build broadband networks that zip 1 gigabit of data per second to users' computers in a handful of regions in the United States.
The idea is to reach 50,000 to 500,000 people, possibly generating new applications such as streaming high-definition video content and real-time multimedia collaboration. Moreover, this network will be open access for anyone to choose their service provider.
At a basic level, this would make Google's Web services more readily available to users. But Google's move portends more disruptive designs for carriers who control the networks. "They don't want to be an operator, or an access owner to the home," Winogradoff said of Google. "They want to be in the middle of everything. This stimulates the discussion in that direction. Google wants to cause a separation of the access network for telcos, putting them in the public domain for anyone to use." With open, public networks as alternatives to private networks from Verizon and other carriers, Google wouldn't have to deploy 20 to 30 data centers around the world to alleviate latency and improve service quality for its search engine and other Web services. "They want to make the private IP network equivalent to the public network in terms of quality and latency so they don't have to spend the money building data centers," Winogradoff continued. BroadPoint AmTech analyst Ben Schachter, whose spoke to Google officials about the broadband move, seems satisfied Google's intentions aren't to wholly join the competitive carrier market despite the fact that Google will hire people to actually lay fiber cable for residences. "We have spoken with the company and management emphasizes that this is a trial only," Schachter wrote in a Feb. 10 research note. "Google wants to see how user behavior changes when Internet speed is greatly improved, and the types of applications and innovations that result. This announcement does not indicate that Google expects to be a major new fiber provider." He believes Google wants to push the telcos to roll out their own fiber deployments. Disrupting an industry is not new for Google, which launched the Google Android mobile operating system in 2007 and has since trotted out its own Nexus One Android phone. Google lets users pick their Nexus One carrier, not unlike what it aims to do with broadband.
Schachter also crunched some numbers and guessed the test could cost Google $60 million to $1.6 billion. His calculation assumes that in serving 50,000 to 500,000 people, this covers 20,000 to 200,000 homes, based on an average of 2.6 people per household in the U.S. He estimated $3,000 to $8,000 per home to arrive at his figures. "Google probably feels it's only going to get half a loaf on net neutrality," Winogradoff added. "This provides them an opportunity to build a test bed to see what they can do on an open environment. The only serious impact I can see related to Verizon is them having to be more open then they were before. This is all about net neutrality." Google has pushed the issue here before, bidding $4.6 billion for 700 MHz wireless spectrum in 2008. Verizon won the spectrum, but Google got the FCC to order that users can connect any legal device and run the applications of their choice.