Google's fiber project is in stark contrast to the substandard offerings of cable and telephone providers in most other parts of the U.S. Unlike in other nations where terrestrial Internet service is running at 100 megabits and beyond, U.S. consumers are only offered relatively slow connections. Here in the Washington, D.C., suburbs most customers have a choice between DSL at 1.5 megabits per second, cable Internet speeds ranging from 2 to 20 megabits per second, or fiber at 20 megabits per second. This area is fairly typical. While a few customers can pay for speeds as high as 50 megabits per second, most cannot.
In an area with such pitiful Internet bandwidth, it initially seems surprising that the bandwidth is so low. But when you look deeper, the situation isn't all that surprising. In most communities, the local governments give cable operators a franchise that protects them from competition. While the local phone companies can also provide Internet service, in most cases it's DSL, which is even slower than cable. Verizon has begun offering a fiber-based television and Internet service called FiOS, but it's not widely available and it only provides 20 megabits per second of bandwidth. The result is that there's no incentive for companies to provide better-customers are basically locked in anyway.
This is why the plan by Google to provide really fast Internet service is important. Google is not a cable operator or a phone company. It's not offering cable television service. Instead, it's an Internet service that's really fast. In addition, Google is planning to offer use of its fiber network to ISPs that want to sign on, so customers can work with an ISP they like. Google is just providing the infrastructure.
If everything works well, this move could prove to be transformative. While it does provide a very fat pipe for Google's video streaming services including YouTube, it also provides vast bandwidth for a variety of other services. Google is already working with a local medical center to develop applications that take advantage of the bandwidth. Equally important, Google won't have to worry about bandwidth throttling by carriers that would rather you watch streaming video on their sites instead of Google's. But in a deeper sense, Google's Internet bandwidth can transform the way businesses function, from access to the cloud to communications between offices. It will, in a sense, make the presence of the Internet pipeline disappear, since there will be no discernable delay, regardless of what you're doing.
To other providers of Internet infrastructure, this should be a wake-up call. Google is going to charge the same rates they do, but deliver 50 times the bandwidth. It'll be very hard to say no to a deal like that.