Google has avoided FiOS markets
altogether (not to mention colder-weather climes that would make fiber
construction more costly), instead picking areas that fall within
AT&T, Comcast and Time Warner Cable footprints. If Google does pull
the trigger, the expansion won’t be cheap: Deploying fiber in all 34
cities would cost between $2.2 billion and $3 billion, Sanford Bernstein
senior analyst Carlos Kirjner estimated.
Kirjner believes Google Fiber is
what Google says it is: a major opportunity. Within six years, Google
Fiber could reach 40 million homes and serve 20 million broadband
customers — and yield $20 billion in annual revenue, by his math. The
capital-intensive characteristics of Google Fiber are divergent from the
parent company’s high-margin, cash-cow search-advertising biz, but that
doesn’t mean it can’t work.
I think it might be a good idea to spin-off Google Fiber because the capex on telcom is always insane and it would bring margins down for the parent. In any case when Google Fiber eventually comes to Hawaii I will be signing up because the speed is insane and they will probably price very low in order to battle the Telcos.
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