Industry Update - Telecom

March 18

Google's New Project Puts Telecom Industry (and U.S. Government) To Shame

Google's announcement that it's going to create one gigabit-per-second networks in a few selected communities looks like what the broadband stimulus program should have been - an attempt to jump start technology, to invest in new ideas and to determine how people will use advanced networks given the chance to use them.

A network that fast is about 100 times faster than the basic "high-speed" service that many customers now have. It's faster than anything offered commercially and it conjures up all kinds of promising developments. The only thing faster is the imagination, which apparently Google has (coupled with some audacity) and which apparently most others in the telecom industry and in the government, don't.

There is no downside to the Google announcement, except perhaps from the point of view of the Federal government, which gave in to the lowest-common-denominator philosophy when structuring the stimulus program, and from the point of view of the incumbent telephone and cable carriers. The telephone and cable industries lobbied heavily to push down the speed limits for networks being built with stimulus funds, then decided not to play when the grant program was announced and now are busy trying to keep other companies, cities and organizations from getting grants to build even the slower networks that the government will fund. Sometimes, they get state legislatures into the act.

Now both the government and the industry are being shown up by Google. The fact that the networks the company plans to build will be open to all service providers and will be operated in a fashion consistent with Net Neutrality principles, in addition to being faster than anything now being offered, will certainly rankle some and there will be, no doubt, some sniping from the sidelines - when there should only be applause.

The project has the potential to teach some new lessons about how to build and provision fiber networks and, perhaps more importantly, to provide a test bed for new applications of truly high-speed data. The applications world has largely been stymied the past few years, with video the only application to take advantage of higher speeds - and that was for better quality of what people were already seeing. The Google networks could open up brand new vistas for the imagination. What this endeavor won't do is make Google a major player in the telecom business. These are test networks, not large-scale projects to compete with an AT&T, Verizon or Comcast. On the other hand, if any of those are shamed into increasing their network capacities by the Google effort, then Google's contribution will be that much greater.

Projects like Google's are certainly ones that any international telecommunications company could have undertaken - pick a small area or two and try out advanced technologies and business models. Unfortunately, that isn't how the telecom industry works these days.

We can certainly use a boost to the U.S. Internet experience. The latest report from Akamai on the state of the Internet listed the U.S. as 18th in connectivity speed. At 3.9 mbps, the U.S. dropped 2.4% from a year ago. The U.S. ranks 15th in broadband penetration.

Statistics for individual states aren't that encouraging, either. Akamai found that Kentucky, for example, saw its connection speed drop 41%, saw high-speed (over 5 mbps) broadband penetration drop 44% from a year ago -- and was one of four states in the Top 10 that reported an increase in dial-up connections. Arkansas has the lowest percentage of connections greater than 5 mbps, 6.7%, while Delaware has the highest, 63%. Other states saw declines in their speeds, also. The report also found 28 states reporting some increase in broadband adoption, with 21 reporting decreases. In terms of high-speed broadband (over 5 mbps), 20 states improved; 30 are worse than a year ago.

We clearly have a long way to go on the broadband front, and if Google can help push a recalcitrant industry and government forward, more power to them.

Source: Huffington Post, 2.4.11, Art Brodsky

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