March 23, 2017
According to the Digital Policy Institute’s Barry Umansky, if you Google “failed gigabit Internet service,” the first hit you’ll get is a story about … Google Fiber. As this blog has written before, despite receiving millions in taxpayer-financed favors from cities around the country, Google Fiber is struggling and, in a column this week in Louisville, Ky.’s Courier Journal, Umansky examines the company’s broken promises.
Instead of delivering superfast internet speeds at cheap pries, “more common” in the cities that gave Google Fiber sweetheart deals are “community disruptions, broken gas lines, burst water pipes and destroyed yards.” The company itself has suffered from “management shakeups, laid-off employees and ‘on-hold’ status for the service rollout in many communities.” Umansky says Google Fiber has been a “money pit” for its parent company, Alphabet, and that it “has proven to be one of Alphabet’s most-expensive side projects, costing the company at least $1 billion per market …”
The biggest costs have been borne by the communities themselves, however, and the taxpayers who live in them. For example, Kansas City was the first community to catch Google Fiber’s eye. After promising gigabit speeds across the city, Umansky reports that “last week, Google Fiber emailed Kansas City residents – numbering in the thousands, according to local sources – informing them that the installations for which they long had been waiting have been canceled …” That’s after Kansas City officials agreed to pay Google Fiber’s rent and utility bills if the company agreed to build a network there.
Google Fiber’s fall has been devastating. As Umansky writes, “When Google Fiber was first announced, more than 1,100 cities and towns from all over the nation aggressively lobbied to be named a ‘Google Fiber City.’” Now, very few cities will ever see the service and many, like Kansas City, are frustrated. That makes this another cautionary tale about mixing government with broadband: cities and their residents simply shouldn’t put taxpayer dollars at risk when promises seem too good to be true.
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