Google Fiber: High Speed Internet Helps GOOG Take Over The World

When I first heard the term “Google Fiber,” I thought Google (GOOG) was entering the health supplement market with another fiber powder. I was pleasantly surprised to find that it was not a fiber powder at all. Instead, it’s a fiber optic service; basically Google’s next stage in their plan to take over the world.

This new service is Google’s attempt at vertically integrating their business. Current Internet service providers (ISPs) offer speeds reaching up to 300 megabits-per-second (Mbps), specifically, Verizon’s FIOS service, which is also fiber optic. Google Fiber will offer speeds over three times that at 1,000 Mbps. The speeds at my house are around 15 Mbps, so I can’t really imagine how fast 1,000 is. For perspective, I can currently watch HD videos after a few moments of loading, but that’s only if it’s the only thing loading.

Wireless To-Date

The latest popular wave of wireless technology is 802.11n, which supports speeds up to 300 Mbps, though many routers operate at lower speeds. New wireless technology, 802.11ac, which operates at speeds of 1.3 gigabits/second (Gbps) has recently reached store shelves, but has not yet become popular because there was really no need for routers with that speed. Additionally, no computers are compatible with 802.11ac, though Google Fiber will likely push manufacturers to popularize the new wireless.

Google Fiber is only currently being offered as a test in Kansas City in both Missouri and Kansas. They typically implement a product or service as a test, and then learn from the experience to reduce bugs and optimize the next steps. We can likely expect an expansion to other cities after their learning period in Kansas City. Additionally, communities that sign up for Fiber will also receive the service at schools, libraries, emergency facilities, and more.

The pricing plans come in several different options. Kansas City residents are required to pre-register for $10 on top of whatever other plan they choose. The other plans include Gigabit Internet and TV for $120/month, Gigabit Internet only for $70, and regular Internet for a one-time construction fee of $300 that can also be spaced out to a monthly payment.

Business Section: Investing Ideas

We’ve seen Google do some amazing things, taking innovation to a new level with many different products. The Fiber service is a step in a complete integration of ISP into almost every aspect of our Internet experience.

This means that Google will begin competing at a higher level than most other ISPs that might not have the ability to keep up with them. Below is a list of companies that will likely be affected by Google Fiber. How do you think they will take on this new competition?

List sorted by market cap.

1. AT&T, Inc. (T, Earnings, Analysts, Financials): Provides telecommunication services to consumers, businesses, and other service providers worldwide. Market cap at $215.83B, most recent closing price at $36.30.

2. Google Inc. (GOOG, Earnings, Analysts, Financials): Google is the world’s most popular search engine. Market cap at $207.97B, most recent closing price at $613.36.

3. Verizon Communications Inc. (VZ, Earnings, Analysts, Financials): Provides communication services. Market cap at $127.31B, most recent closing price at $44.46.

4. Comcast Corporation (CMCSA, Earnings, Analysts, Financials): Provides entertainment, information, and communications products and services in the United States and internationally. Market cap at $87.23B, most recent closing price at $31.61.

5. Time Warner Cable Inc. (TWC, Earnings, Analysts, Financials): Operates as a cable operator in the United States. Market cap at $26.37B, most recent closing price at $84.40.

6. CenturyLink, Inc. (CTL, Earnings, Analysts, Financials): Operates as an integrated communications company. Market cap at $25.38B, most recent closing price at $40.85.

7. AOL, Inc. (AOL, Earnings, Analysts, Financials): Operates as a Web services company that offers a suite of brands and offerings for the worldwide audience. Market cap at $2.9B, most recent closing price at $31.04.

8. Clearwire Corporation (CLWR, Earnings, Analysts, Financials): Provides wireless broadband services. Market cap at $639.73M, most recent closing price at $1.01.

9. EarthLink Inc. (ELNK, Earnings, Analysts, Financials): Provides communications services to individual and business customers in the United States. Market cap at $733.91M, most recent closing price at $6.76.

Written by Danny Guttridge

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