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Google Fiber: Making the Right Connections?

Google Fiber
October 2016

Gigabit Internet is the next big thing in multifamily technology. Is Google Fiber the leader, or poised to step aside?

When Google Fiber launched in Kansas City in 2012, the company promised lightning fast Internet speeds. How fast exactly?

The average Internet speed in the United States is 24 megabytes per second (Mbps), according to content delivery network service provider Akami. Google Fiber offers speeds up to 1,000 Mbps.

Isaac Gortenburg’s apartment community in Kansas City, Kan., was one of the first multifamily buildings to be fully wired for Google Fiber. Gortenburg, President of Eighteen Capital Group, has since added Google Fiber to three of his Kansas City, Mo., apartment communities, and is about to do the same with another community in Austin, Texas.

The ability to offer gigabit Internet, and free 5-megabyte service, which Google Fiber supplies in Kansas City, has been a marketing boon for Gortenburg. “It’s what’s drawing people in,” he says. “People aren’t showing up and saying, ‘Oh, I didn’t expect that.’”

Steve Sadler, Director of Multifamily Development at RealPage Inc., would like the multifamily owners he works with to have that same advantage, but he’s never been able to get Google Fiber to actually wire any of his client communities.

“We’ve designed [and installed] the infrastructure for Google to come, because the client wants them to be there,” Sadler says, estimating that he’s tried to have Google Fiber installed in dozens of new multifamily communities during the past 18 months. “They’ve deployed to none of them.”

Now, as reported in The Wall Street Journal in August, Google has put the brakes on laying new fiber in cities such as San Jose and Portland. The company appears to be rethinking how to deliver service, potentially moving into wireless technology connections, using “dark fiber” (unused fiber-optic cable) instead of laying its own or working out deals in which cities pay for the fiber installation.

Is Google Fiber just not that into the apartment housing market? As it tinkers with its model, will it become more or less likely to add apartment communities to its ranks?

When Google Fiber Deploys

The properties that Gortenburg operates that have Google Fiber are all existing communities that were already wired for other Internet providers. When he added Google Fiber to the mix, he didn’t give the company any exclusive rights to market; it is just an additional resident Internet option.

A short time after he signed the agreement, a Google Fiber team came to the property to install fiber jacks in each unit and run wires. “It went as smoothly as I could have imagined,” Gortenburg says. “My biggest concern was that they were going to drill all over my roof and on the side of my building. Having wires running down would have made the exteriors of the buildings look terrible.” Google’s technicians addressed any concerns he had to his satisfaction.

Gortenburg lists Google Fiber as an optional amenity on the Internet listing services he uses, and he gets an extra marketing boost from the Google Fiber website, which lists the apartment communities in each of its markets that are Google Fiber-ready.

Gortenburg doesn’t know how many residents are choosing Google Fiber over other Internet providers, but he surmises it’s a “decent amount.” Residents face varying contract terms depending on the provider they choose, with commitments typically either six-months or one year. Those opting for Google Fiber, however, require only a credit card and Gmail account to use the service on a month-to-month basis.

When Google Fiber Disappears

Sadler, whose multifamily housing clients are all developing new construction, has had good experiences working with the Google Fiber infrastructure team, but then radio silence.

“They have a good team that coordinates the base infrastructure, but I don’t know what happens to the fiber team,” Sadler says. “They just don’t ever seem to get [to our properties].”

With new construction, Internet providers ideally would be at the community during lease-up. “If [an Internet provider] isn’t there on Day 1 and instead comes cruising in six months to a year later, all the residents likely already have signed up for service,” Sadler says. “I’ve seen over the years that the third company that’s coming in on an existing portfolio of properties is lucky if it gets 10 percent the first year and maybe 20 percent after two or three.”

Sadler envisions Google Fiber doing what the more-established Internet providers did years ago: Develop a single-family model for service provision, and then try to also use that model in multifamily housing. The Google Fiber agreement is such an example.

“As a consultant to apartment owners, the big bugaboo has been the contractual piece,” Sadler says. “There’s [provisions] in there that put owners in a tough spot and in potential conflict with their other agreements. You have to spend a lot of legal dollars to get their agreement to a point where you can use it.”

Google Fiber Taking a Detour?

In June, Google Fiber acquired Webpass, a wireless Internet service provider (ISP) operating in the multifamily housing space in five cities. The Wall Street Journal reported that Google Fiber is planning to use central fiber to which antennas connect homes to the service wirelessly. Currently in Kansas City, Google is testing wireless connections from antennas on street lamps.

Given the vagaries of wireless connections, Sadler is a bit skeptical that this arrangement will work out. “Flaky little issues are just the nature of wireless,” he says. “It will depend on how it gets delivered to the house.”

Google Fiber is also continuing to explore greater use of dark fiber, which Sadler thinks is smart.

Sadler, along with many other tech experts, has always wondered if Google Fiber was ever meant to be a long-term ISP.

“There’s always been this speculation from people in the industry: Do they really want to deploy widely or do they want to deploy just enough to put pressure on everyone else to up their game?” Sadler says. “All other players in markets where Google is available have stepped up their game, so it makes you wonder.”

Whether or not Google Fiber sticks around, it seems likely that demand for gigabit service will only grow.

“Fiber is something we are looking at doing across the board, not just in Kansas City, but anywhere we can get it done,” Gortenburg says. “If it’s not this year, then it will be next year when everyone will want gigabit service. The current Internet service is going to feel like what 28k [speed] was 10 years ago; it’s going to feel like dial-up.”


Gayle Bennett is a freelance reporter.