Google Fiber Comes To Provo, Utah

Jesse HarrisYesterday was a big day for my friends down in Provo, Utah. They announced that Provo would be the 3rd city in the USA to have Google Fiber, the 100x faster Internet for an affordable price that Google is slowly rolling out around the country. Speeds like that include TV packages and an unimaginable media experience (think about downloading an entire HD movie in a few minutes). It will be a great thing for startups and businesses in the area to have access to. Here is a link to their page with some details about Google Fiber in Provo. Overall, I am incredibly excited and think it is a terrific deal for the area and the residents and businesses. I’m 100% for it and see no real downside. However, as is often the case, not everyone sees things the way I do. So I asked my friend Jesse Harris to do a guest post here about his take on it.

Jessie is someone I, and many others, consider to be an expert when it comes to Internet speeds, infrastructure and broadband news in the State of Utah. He’s been following broadband in Utah since 2006 at FreeUTOPIA.org and has been interviewed and cited in numerous media sources including the Salt Lake Tribune, Deseret News, Provo Daily Herald, and Salt Lake City Weekly. Jesse is passionate and knowledgeable about the subject, so while I don’t totally agree with him, I still thank him for sharing his well stated opinion on the new Google Fiber announcement for Provo.

Read on to see what he thinks.

There’s a lot of excitement in the air as Provo announced that their long-ailing fiber network, iProvo, would be taken over by Google’s new fiber project. It’s not hard to see why. The service will offer 5Mbps downloads and 1Mbps uploads to everyone for a one-time $30 setup fee, and 1Gbps downloads and uploads for just $70/mo. Those kinds of speeds, bereft of the monthly transfer caps imposed by CenturyLink and, until recently, Comcast, could lead to an explosion of self-hosted services, home-based businesses, and new startups. Those empty second-floor offices on Center Street could end up housing Google’s potential successor.

This doesn’t come free, however. The city is making Google a very sweet deal: get the existing network for free, and they’ll finish the remaining $39.6M in bond payments over the next twelve years. Google only has to spend an estimated $18M to build a network that, based on costs from UTOPIA and other fiber networks, could easily cost $90-100M to do from scratch. They also reserve the right to pack it up and halt the service after a seven year commitment. The city still has a repurchase right, but it could be left scrambling for a solution in that event.

What makes the arrangement in Provo so unique is the existing network. The terms in Kansas City and Austin are more-or-less the same: no franchise fees, unlimited right-of-way, and they can quit after the commitment period. In both of those cases, they’re not really giving up much to get the network. Provo is putting a lot more on the line. They are, however, getting a few more concessions. City facilities will get free gigabit service. The one-time fee for the low-end service is 1/10th that of other cities.

For most users, the choice is clear. The only other viable gigabit option in the state, UTOPIA, charges $300 per month and a one-time install fee of $2,750, albeit you get a choice of several providers and can pick up phone service. You don’t even want to know what CenturyLink or Comcast would ask for. (Hint: it’s about ten times as much.) It’s hard to argue with the basics of the deal.

Some users may not like the privacy implications of letting Google be in a position to be aware of their Internet habits and TV watching. As the only choice on the network, it doesn’t offer the kind of service provider flexibility that UTOPIA users have come to enjoy. Google is also not exactly renowned for their customer service ability.

For the city, it may be less clear. Giving up tens of millions of dollars in potential network value may or may not pay off in the long term. Google may decide that this is something they want to stick with, or, like they’ve done with so many services (looking at you, Reader), they may decide that it was fun while it lasted and pull the plug at the end. If you built your entire business around their service, you could be left in a very serious and expensive lurch.

Another downside is that many broadband users, instead of trying to solve the problems of broadband access for themselves, may opt to hold off to see if Google will come to their neighborhood for free. I’d like to think that all technologists can agree that broadband is an essential commodity service, and the current state of it is lackluster at best. Giving users a sense of false hope for a white knight savior may stifle my own efforts to build a gigabit cooperative here in my neighborhood.

It’s easy to get excited by being in the national press for a system that most users can’t even dream of. But let’s not be blind to the potential downsides as a result.

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About Alex Lawrence

Alex has been a successful entrepreneur for 20+ years. His current venture Lendio ranks #34 on the Inc. 500 list. Alex earned a BS degree at the University of Utah and his MBA at Weber State University, where he is Vice Provost and Director of the Entrepreneurship Program. If you want to talk with Alex about business and entrepreneurship (or other questions), email him (alex AT startupflavor DOT com), or you can find him on Twitter @_AlexLawrence.
  • Don’t eat food! You might choke!
    Glass of Water! The Ominous Drowning Danger!
    Thumb Tacks! Pokey Pins of PAIN!

    Then again, he had a great point about Google Reader …

  • Great writeup here, Jessie! Thanks for sharing your knowledge on the subject.

    Google seems to be on an endless quest to gather more information about people, and, as you mention, Google Fiber is an extension of their drive to acquire more and more user behavior data. While it’ll be great as long as they stick to their “Don’t Be Evil” motto, it could get ugly quick if they continue down the “please stockholders at the expense of users” path that so many public companies follow.

    I’m a little too excited about Google Fiber to see clearly, though. 😛 From your knowledge of the iProvo network and Google’s plans here, do you know roughly the boundaries of this network? Is it limited precisely to the city of Provo or does it extend into Orem, Pleasant Grove, American Fork, Lehi, or any of the nearby cities? I get the impression that it’s a rather narrow area, but yknow…

    • I am about 500 feet from Provo city limits in Orem. I am especially interested in this question!

    • elforesto

      It’s strictly within the city limits, and I believe there’s fiber at least on the curb in all neighborhoods. There may be some isolated developments and MDUs that aren’t covered quite yet, but they are few and far between.

      • Well drat. But I appreciate the answer. 🙂

        Anyone else want to chain some WiFi repeaters up to Point of the Mountain with me?

        • elforesto

          Your best bet is to find some old 18″ satellite dishes to build a wireless bridge. Those bad boys can do LoS over at least 50 miles.

          • Is that… is that legal? I think you’re joking. Are you joking? You’d better be joking.

            … I gotta buy some satellite dishes.

          • elforesto

            If you stick to unlicensed spectrum (900MHz, 2.4GHz, or 5GHz bands) and don’t pump more than 1W of power into the antenna, it’s perfectly legal. http://www.afar.net/tutorials/fcc-rules

    • JoeBloeUtah

      Google already has failed the “Do no evil” statement. Failed it long, long ago.

  • I’m not in Provo so I don’t care much. I think I would be excited though if it came to my hometown (Alpine). I’d be equally excited if UTOPIA came to my town. All in all, I’m most excited that Comcast and Centurylink are getting more competition.

    “Google is also not exactly renowned for their customer service ability.” > I’d take Google over Comcast/Centurylink any given day.

  • JoeBloeUtah

    I’ll ask a question to the mayor of Provo for my business idea. Let’s see if he bites. Here’s what I want to do: I get full access to any home or business in the city at any time, 24 hours a day, 7 days a week. I can rummage through their closets, book cases, mail, etc, and store that information for any period of time, and use it to send targeted advertising to the home and residents or business owner and employees. What do you think, Mr. Mayor? No? I can’t? Well, that’s exactly what you’re doing by letting Google into your city. I’m just happy I don’t live there. And shame on you for not protecting the personal privacy of your residents and businesses.

    • moo

      you act like your ISP doesn’t do that already.

      • JoeBloeUtah

        It’s entirely different. Google monitors EVERYTHING and links it all together. They scan your emails looking for keywords and links that to searches that are linked to YouTube videos viewed. The EU is investigating this behavior and everything I’m reading about it indicates Google will be fined over this invasion of privacy. People complain about privacy issues related to Google StreetView. It’s going to get much, much worse with Googly Eyes (ie, Google Glass). Google is NOT a tech company, Look at their financial statements and you’ll see the very large majority of its income comes from advertising. Everything the company does is designed to push ads. This deal with Provo is nothing more than another vehicle for Google to collect more data about people and then push ads.

  • Owen Johnston

    While I agree with you that the Google Fiber deal isn’t perfect, I think it is important to consider it in the context of the alternatives.

    Customer Service: The companies in a position to compete with Google Fiber in this area are CenturyLink, Comcast, and Veracity. While out of these 3 I only have personal experience with Comcast, these companies appear to generally get a bad rap for customer service. I don’t anticipate Google being worse, although it is certainly possible they won’t be any better.

    Privacy Concerns: Again, do you trust Google less with your personal information than Comcast, CenturyLink, or Veracity? The difference with Google is that they use my information in a way that creates value for me. Google Now blows my mind with the info it automatically displays for me and it is just the start of what Google can do. And currently the cost is that Google can use my info to deliver targeted ads to me. I would rather have targeted ads (ie. ads for things I might want) than irrelevant ads. Is it possible that someday Google will do something nefarious with my data? Sure. But the same risk exists for any of the other ISPs.

    Value of Capital Assets: It is true that Provo paid tens of millions of dollars to build iProvo, but that doesn’t mean that the network is currently worth that much. I have an old pentium 3 server in my garage that someone probably paid thousands of dollars for, but I don’t bother using it because there is no way I can extract enough value out of running it to be worth the price of electricity. The same applies to the iProvo network in its current state. Several organizations have tried and failed to run the network for a profit. It is certainly possible that there is someone out there who would pay Provo something for it, but if so, where are they? The network has been on the market for 18 months. If there are people concerned with Provo not getting a fair deal here, I am all for a “go shop” period to see if someone else wants to make a better offer, but honestly I don’t see anybody coming in with a better offer.

    Google Backs Out: The terms of the contract state that if Google fails to meet its obligations, the city can buy back the network for $1, including any partial upgrades google has made at the time of the repurchase. This includes an obligation to finish the upgrades and network expansion within 5 years and offer free service for 7 years. If Google backs out immediately, we just stay the way we have been. If google back out after upgrades and expansions are partially or fully completed, Provo gets some free equipment out of the deal. If Google meets its 7 year commitment and then discontinues service, the upgraded network remains intact for someone to buy it and operate it in Googles place. Unless Google decides to dig the fiber out of the ground and haul it all back to California, I don’t see how Google backing out can put the city in a worse place than it is now.

    False Hope for Others: Well I guess that not my problem now 🙂

    Also I read through the purchase agreement last night and discovered that Google has in fact agreed to a franchise fee, although it appears that it only applies to video service. They will pay the city 5% of gross revenue that comes from selling video service in Provo. Assuming they offer the same prices in Provo as they do in Kansas City, this will amount to $2.50 per month per subscriber going to the city. This isn’t a ton of money, but it is something.

  • AJ

    “Another downside is that many broadband users, instead of trying to solve the problems of broadband access for themselves” …I am curious how I could solve the problems for myself. I see the downside but what are we supposed to do about it?

    • elforesto

      I’m working on a coop in my neighborhood. The users will own the network. It’s going to be a lot of work, but it beats waiting for a winning lottery ticket.

  • During the last major election, the state of Utah was run amuck with rumors of how the current administration was simply doing what it wanted without the good people of America’s consent… yet, here Provo elected officials are engaged in selling a property that BELONGS TO THE PEOPLES (or tax payers of Provo Utah) without ANY consent from the peoples who have the financial burden as well as OUTRIGHT COMMUNITY OWNERSHIP of.

    Google should be ashamed on this, if they truly represent American Business and how it should be handled. The elected officials in Utah behind this deal should be facing charges of corruption and extrotion of the American Tax Payer.

    There is NOTHING of merit in these dealings. Nor do they maintain ANY FORM OF INTERGRITY. This is officials abusing their authority over the peoples property and I would bet a llook into their stock portfolio’s would indicate EXACTLY what this is about, and its not about treating the good citicens of Provo as though they exist in a dictatorship ANY LONGER!!!



    Every American that values its COMMUNITY PROPERTY best stand up on this one before this becomes an accepted, common place behavior of Utah’s elected officials!!!

    • You should research what constitutes consent in dealings like this. They are following the appropriate procedures. I disagree that a city should have this power, but considering they do, they are not behaving incorrectly by this upfront deal with Google (part of the public record).

  • Great article, however I have to say this article makes the Google Fiber addition to Provo sound like a bad thing. The deal in no way hurts Provo if you step back and look at the big picture of this situation. Sure, Google could pull out in 7 years and leave, but they won’t. Provo is too big of a tech city, and the growing economy only helps. I think you are looking too much at the negatives when in reality the positive aspects out-weigh the negatives. For more on this, check out my article on this at http://www.provobuzz.com/how-google-fiber-will-completely-change-provo/

    • elforesto

      The devil is ALWAYS in the details, and I think it’s important to take a very close look at them, especially since the public input and inspection period is quite limited. It’s probably the best deal Provo is willing to negotiate, but they could definitely do better. http://www.freeutopia.org/2013/04/20/google-fiber-the-best-deal-provo-deserves-but-not-the-best-deal-it-can-get/

      Don’t let your enthusiasm blind you to the potential downsides. Google is getting a very sweet deal at the expense of the taxpayers, and they have stated very clearly that they don’t really care about business services. It may still be a net positive, but don’t act like it’s ALL positive.

  • delighted2write

    Provo’s mayor, John Curtis, is my uncle! Proud moment.

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