Google's new 1000Mbps fiber internet service sounds a lot like a stunt: It's mindblowingly fast (3x faster than Comcast's very fastest internet); it's mindblowingly cheap ($70 a month! or $120 with Fiber TV); and it's only going to be available in Kansas City when it starts rolling out on Sept. 9. Oh, did I mention it's also giving away (slower) broadband for free? In some ways, it is a stunt. But it's a deeply important stunt.
To understand why, you need to understand the state of broadband in the U.S. It's kind of like the state of education — it doesn't seem all that bad from here, but then you compare how we're doing versus other countries, and you realize we're not doing all that great. In average broadband speeds, the United States, home of Silicon Valley, ranks 25th internationally according the Communication Works of America, and 13th according to a more recent report from Akamai.
The problem, as the FCC sees it, is competition. There simply isn't enough of it between ISPs:
Given that approximately 96% of the population has at most two wireline providers, there are reasons to be concerned about wireline broadband competition in the United States. Whether sufficient competition exists is unclear and, even if such competition presently exists, it is surely fragile.
The result is that broadband isn't getting faster fast enough, and the prices aren't coming down as quickly as they would if there was fierce competition. The FCC's goal is for broadband that provides at least 50Mbps downstream and 20Mbps upstream to reach 100 million households by 2015. Below is a map of where those speeds are available right now.
Not a very filled-in map! And broadband competition may be getting worse for consumers, not better. A recent deal between Verizon and major cable providers has the Department of Justice "concerned that a side deal between Verizon and the cable companies is, in effect, an agreement not to compete for Internet users in each other's territory, and could leave many Americans with a single option for broadband service."
And that's why what Google's doing is important. While Google doesn't intend to roll out insane fiber or free internet to everybody's neighborhood anytime soon, the grand fiber experiment is a lot like its entrance into the 700MHz wireless spectrum auction a few years ago: It's a threat to incumbent broadband providers, a tactical move to get what it wants out of the companies who control the way people get on the internet. When the FCC auctioned off a chunk of the 700MHz spectrum — a slice of hotly desired airwaves because it's especially suited for carrying wireless broadband — Google entered the auction and put up $4.6 billion, in effect threatening to launch its own wireless broadband network, simply to get the FCC to put in place "open access" rules for whoever won the auction. Verizon won, that spectrum is the backbone of its 4G network, and it has Open Development initiatives as a result.
Rolling out gigabit and free internet to people's homes has several effects along those lines: It stokes demand for faster internet (Google offers it!); it sets an example for the FCC and broadband advocacy groups to point to (particularly the free 5Mbps internet); and it makes the subtle threat that, if there's enough demand and broadband companies won't meet it, Google will. Sure, Google's interest in making sure the fastest possible internet is available to as many people as possible is self-serving — basically, people on the internet = people using Google = money for Google — but it's ultimately something for the greater good, too. Faster, cheaper internet available to more people, by any means necessary: Who can argue with that?