The U.S. telecommunications industry may finally be getting
an injection of competition with Google’s plans to roll out its Fiber service
in 34 different cities.
today of its intentions to deliver superior broadband speeds at a better value
is welcome news. Google is exploring entering into the
Atlanta, Nashville and San Jose areas. It also needs to
ensure the quality delivery of its services, which is in question, as net
neutrality has come under
attack by operators.
Google has good reason to be concerned: there’s scant
competition in major U.S. cities where broadband services are controlled by
monopolies, duopolies and oligopolies - despite claims of highly competitive
markets. U.S. consumers pay more for less comparative to the world, and that could
inhibit Google’s growth.
Internet services fare
poorly in value against ISPs in other countries. A 500-megabit
data services will cost $25 a month in Hong Kong and around $30 in Seoul, due
competition in the marketplace. Prices in the U.S. are far afield.
Verizon's fastest FIOS
services (where available) that run at an equivalent speed cost over
$310 per month. Contrast that with Google, which could soon be
delivering its one-gigabit-a-second high-speed Internet service in nine U.S.
Google Fiber’s first deployment
was in Kansas City in 2011, where it charges US$70/month for broadband access
and nothing for basic services. In comparison, I pay over around the same for 30Mbps from Time Warner, and it’s not a great
service by any means. There's just no other choice in my building.
That’s why Google’s
fiber plans are so significant. Its Kansas City deployment and its
subsequent expansion into the nearby Missouri suburbs compelled AT&T to up
its game. The telecommunication giant also responded to Google's Austin, Texas Fiber service by building out its
network there late last year.
AT&T’s pricing isn’t
publicly facing, and services will start at speeds up to 300Mbp. Would it have acted without a gut punch from Google? Probably not. Let competition determine what the market delivers.
This post was originally published on Smartplanet.com