New theory on Google's fiber experiment - a utility revolution

Could Google be planning to revolutionize the energy market with its gigabit fiber network?
Written by Mari Silbey, Contributor

Google has slowly but surely been making progress on its rollout of a gigabit fiber network in Kansas City, Kansas and Kansas City, Missouri. But while there is clear evidence that Google intends to test out its own TV service over the newly laid fiber, there's very little information otherwise on what Google has planned for its high-bandwidth infrastructure.

Now, Canadian engineer and researcher Bill St. Arnaud has put forth a new theory. Maybe Google is planning to partner with a local utility company to push smart energy applications. The idea is that Google could work with an electric utility to manage peak energy usage and reduce energy costs. Instead of returning those savings to consumers directly - a presumably small amount per subscriber - Google could redirect that new-found money into its fiber network, and toward the support of profit-making premium services.

The idea isn't as strange as it sounds. As St. Arnaud points out, Google's deployment activity suggests that it will drive fiber out to individual homes even before consumers subscribe to its broadband service. (St. Arnaud makes this assumption because of where Google is currently stringing its fiber on utility poles.) What if the company plans to offer the basic broadband service for free with a plan to make money only off of additional services delivered on top? TV alone wouldn't cut it, but maybe TV combined with premium fee-based wireless services, and new smart energy programs would.

I asked independent telecom and energy tech analyst Cynthia Brumfield if she thought St. Arnaud's theory was a viable one. She couldn't say definitively yes or no, but she did have this comment:

Google has a history of using its substantial financial resources to mount experimental projects in highly concentrated networked industries, such as telecom, cable and electricity. Whether any of these projects prove to be profitable almost seems to be irrelevant; the experiments seem to be aimed at creating new ways for outsiders to participate in, or even compete with, capital-intensive entrenched infrastructure providers.

In other words, Google is perfectly happy to tilt at windmills. But in this version of the literary analogy, Don Quixote comes with the resources of a David, rather than a Goliath. Will Google revolutionize energy services and ultimately make a profit from combining gigabit fiber with smart grid technology? Who knows? But it certainly has the money and the moxie to try.

Photo: Google Fiber Blog

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