Small businesses might gain one very big friend in Google Inc. The massive Internet technology company could finally give small firms what years of policy-making in Washington couldn’t–affordable, world-class, broadband Internet service.
While it’s often true that the interests of small and big businesses are rarely aligned, Google’s plan to develop an experimental fiber network has the potential to seal an unprecedented partnership between the tech giant and small firms.
The company announced this week that its network will “deliver Internet speeds more than 100 times faster than the service provided to most households today.” The service will deliver 1 gigabit per second, fiber-to-the-home connections, a significant gain over the paltry 10 megabits per second connections offered by most cable and telephone companies.
Google’s announcement rocked the status quo, which consists of a “duopoly” of telephone and cable providers that have a lock on 96 percent of the Internet service market. The lack of competition has left the United States woefully behind the rest of the globe. It now ranks 15th in the world for broadband service, according to the Organisation for Economic Cooperation and Development’s (OECD) 2009 rankings. The nation has slipped three more places since the group’s previous study.
The OECD’s methodology has been widely attacked by Internet providers, but a separate, independent study released last October by the Berkman Center for Internet & Society, at Harvard, yielded a similar result. It concluded that the U.S. was “in the middle of the pack” compared to other nations.
The fact is, a small business in Europe can choose from multiple access providers and get service that’s 10 times the speed and half the price of service typically available to U.S. small businesses.
Google’s network will be small. It likely will reach no more than 500,000 customers at its grandest. But the Mountain View, Calif., company hopes it will prod cable and phone companies to offer cheaper, speedier access on a broader scale.
That’s something Washington policy makers have been unable to do for more than a decade. Indeed, during the Bush administration, cable and telephone companies solidified their hold on the market, thanks to a compliant Federal Communications Commission.
In 2005, for example, the FCC under Bush repealed rules that required dominant cable and telephone providers, such as Verizon and AT&T, to sell access to their systems at reduced prices so that other Internet Service Providers, also known as ISPs could compete with them.
The idea behind the rule was to foster competition and innovation, and Google is essentially reviving the policy with its system. It will be open to third-party service providers to deliver Internet to their customers.
Google has yet to say where it intends to build its experimental network, but it could be operational as early as next year. That’s sparked a land rush among communities and businesses to attract the Internet giant.
Sacramento, Houston and Portland, among other cities, have already set up “Bring Google Fiber” groups on social networking site Facebook to campaign for the project. It’s not hard to see why there is such interest.