Despite its blazing fast data speeds, Google Fiber is off to a slow start. The web search king’s home internet and television services are only available in a few markets and while it may be expensive to organize a community install, a lack of infrastructure doesn’t appear to be holding Google Fiber back. It turns out that the need for television programming could be delaying Mountain View’s ISP efforts, as Google is dishing out large sums of cash in hopes of competing with established cable companies.
Recently speaking at COMPTEL telecom conference in Dallas, Texas, Google VP of access services, Milo Medin stated that television programming is the “single biggest piece of our cost structure.”
While cord-cutting may be a popular trend, being able to bundle items like high-speed internet, TV and phone services are a big deal when trying to compete with major players like AT&T, Time Warner, Cox, Comcast, Charter and Verizon.
“We operate at a very significant difference than incumbents we compete against,” Medin told an audience. “We may be paying in some markets double what incumbents are paying for the same programming.”
Google’s Fiber services have caused companies to adjust pricing of their high-speed internet services in select markets, however the search giant is pretty much a non-factor when it comes to television programming. Telecommunications heavyweight AT&T is currently developing its own fiber-based internet services and is in the process of acquiring DirecTV. While Google’s competitors show no signs of slowing down, the company will have to find ways to secure additional programming to drive down costs and make its packages more appealing.
(via The Washington Post)