On Wednesday, Google announced it was mulling whether to expand Google Fiber to as many as 34 new cities around the country. Many of these are mid-sized locations like Portland and San Antonio — a sign that Google's early efforts in slightly smaller places, such as Kansas City, are paying off and that the company is ready to take on bigger challenges.
Final decisions about the lucky cities will be going out by the end of the year — what might seem like an interminable delay for the residents of those communities. But folks who live in denser metropolitan areas may be in for an even longer wait. Here's why.
Google's choice to enter new broadband markets depends on a few factors. One is the state of the existing infrastructure. Some cities, such as Seattle, boast bundles of fiber optic cables that were installed as early as the 1980s and for one reason or another, nobody ever turned them on. While Seattle isn't a Google Fiber city, previous groundwork like that makes life a little easier for Google in general. Other cities without that infrastructure — or with especially difficult terrain — might find themselves at a disadvantage.
Another factor involves getting the necessary permits and other paperwork to build fiber where it doesn't yet exist. Laying fiber below ground, or stringing it on poles above it, requires Google to negotiate deals with cities and utilities for rights of way. These agreements can come at a cost, though as we'll see, Google has in some cases managed to skirt these issues.
The third factor is the real kicker, and it's how badly a mayor might want Google Fiber for his town. It's no surprise that there's far more demand for it than Google can keep up with. Internet speeds on fiber optic cables are up to 100 times greater than the national average, and Google makes a point of giving Fiber access to schools and public libraries for free. To help assess a city's commitment, Google provides it with a checklist of things it has to complete in order to qualify for Fiber. Any smart mayor who wants the service is going to do everything he can to appease the search giant in hopes of attracting it to town — and then some.
In a head-to-head competition with other cities, mayors have proven willing to bend over backwards for Google. Take Kansas City. Its deal with Google includes no charges for rights of way, a city commitment to review any permit application within five business days and the use of detailed mapping software and other city assets for free. Google was granted office space, the freedom to manage road traffic and enjoyed access to a dedicated team of city employees who would intervene on its behalf if and when exceptional problems arose. My now-colleague Timothy Lee wrote at the time that this amounted to outright corporate welfare.
Google isn't alone in pitting cities against one another for the most favorable terms. The billionaire investor Elon Musk recently extracted $20 million in financial concessions from Brownsville, Tex. — the country's poorest metro area, according to Bloomberg — in exchange for a SpaceX launchpad that will directly create an estimated 600 jobs.
While smaller cities may find it necessary to attract investment by wooing influential companies, denser metropolitan aren't likely to prostrate themselves in quite the same way. They probably couldn't, even if they wanted to; there are so many moving parts to a New York or a Chicago that giving Google free rein would be an extremely complex endeavor. Besides, as Google has already demonstrated in Austin, the company has tremendous power to create new broadband competition in local markets. Bringing Google Fiber to a large metropolitan area would certainly get the attention of incumbent Internet providers, but larger cities also tend to have more of them in general. In that kind of environment, Google's disruptive impact might be slightly diminished. The company stands to make a bigger splash in smaller ponds.