Google

Google bringing 1-gig Internet to your home, but not your office

2013-04-21T10:25:00Z 2013-07-23T06:41:50Z Google bringing 1-gig Internet to your home, but not your officeGenelle Pugmire - Daily Herald Daily Herald
April 21, 2013 10:25 am  • 

PROVO -- Google promised free Internet to every home. It never said anything about businesses.

As residents attend town meetings and ask questions of Google employees and city officials, more information is coming out about what being a Google Fiber city means for Provo.

Residents will get Internet for seven years for a sign-up fee of $30, or gigabit service for a yet-to-be-determined monthly fee. Small businesses may have access to the network, as will a few larger organizations, but most businesses won't be on the network. They'll have to get Internet service through other providers. Other companies on the network, including Veracity, will be invited to get off once things start rolling.

Residents still will be paying a fee with their utility bills to pay off the iProvo bond; Google is not taking that payment over, although they are buying the network -- for $1. Despite that, city officials have still tout Google Fiber as a boon to the city. Here's why.

Why not sell the network for what the city owes on the bond?

"It's not accurate to say they are getting it for a dollar," Mayor John Curtis said. "We are working with intangibles."

Simply put, no one wanted to buy it. Right now, the iProvo network has been around for about a decade. About 15,000 of the 35,000 homes in Provo are connected; only about a third of those houses are connected. The city still owes millions of dollars on the bond, and the network is already antiquated. No company would take on that debt plus the cost of updating the network plus the cost of marketing and running the system. The city cannot run the network because of state laws, and no company has been able to make iProvo profitable.

Thus, Google's offer is a gift to the city.

"We have been very aggressive looking for buyers for the network," Curtis said. "This network was designed, conceived and installed three years before the iPhone. It is soon going to be antiquated. It will take $20 million to improve the network. So 18 months ago we went to the world and said this is for sale."

Curtis said he didn't do the traditional request for proposals. "We went out and said what would you do with this network? Help us here. We went hard so we knew we could turn over every rock and see who would be interested in this network. We had three or four, maybe five take a look at the network. They all said 'we can't pay you anything for this network -- it would need a large investment to make it usable.' ... I can guarantee you and I can promise you that we talked to everybody. One by one they declined and stepped out of the picture."

So, while Google is paying $1 for the network, officially making it a sale, the city is not losing money. When Google offered to step in, replace the needed equipment and expand the connections to the other 20,000 homes, it became a good deal.

"Residents have been left with a bill without a return. With this they are getting a return," Curtis said. "Our first goal it to eliminate the bond debt."

Why did Google come to Provo?

That's where iProvo came in. Because of the network, Google has less work to do to get Google Fiber going.

"Google is 14 years old. One consistent thing we have believed in is that fast is better than slow," director of community affairs Matt Dunne explained in a town meeting Thursday said. "Starting out we knew what consumers wanted was to get the info and content they wanted as quickly as possible. We took that really, really seriously."

Dunne noted that Internet speed has increased a hundredfold since its inception.

"Today we can't imagine what it would be like to not have that speed," Dunne said. He added that he expects the same thing will be said someday about the gig speed Google Fiber will provide.

"What we want to do is actually provide that next step function. We believe the future of the Internet in innovation and technology is not going to be built on the current speed," Dunne said. "What we have embarked on is bringing gigabit speed directly to consumers."

Dunne added, "What I want to be clear is that we are not here by accident. What we saw in Provo was a city that understood early on that connectivity mattered, and a community that is based in a tech valley where there is a lot of innovation already going on."

Google wanted people to use this area and test this and see what the limitations are.

"We got a mayor's team that was willing to work with us in unique ways and at Google speed," Dunne said.

What do we get?

Residents will get seven years of television service as well as free broadband, Dunne said.

"We decided we wanted to offer television as well as the gigabit speed: not only hundreds of channels, but hundreds of channels that are default in high definition," Dunne said. DVR with 2 terabits of storage also will be available. The cost for TV plus the gigabit Internet is $120 a month in Kansas City.

Residents won't be getting a Google phone service.

"For telephone service we didn't feel that was something we could improve on," Dunne said.

What Provo will get is a commitment for at least seven years. "We're here for the long haul, this is not a short term thing," Dunne said. "We are so excited to see what will happen, to see the first universally connected community. We get kind of goose bumps of what that could do and what that would mean that 99 percent of the people were connected. We will be able to connect the first customers by the end of this year here in Provo."

Is this better or worse than what I already have?

For many, it will mean they can get on the network if they wish, an option many Provo families haven't had before.

"Not only that, once we connect them they will have access to gigabit speed," Curtis said. "There will be a charge for that but we will offer five down and one up, roughly the average speed across the country."

The free Internet is not as fast as Veracity is offering through iProvo -- but it's free. The gigabit Internet will be much faster than Provo residents are used to, but it will cost. In Kansas City that's $70 a month; in Provo the prices haven't been set yet.

People who are emailing and web surfing should find the broadband's speed to be adequate.

"When we say every home I do need to put an asterisk by that," Curtis said. "We think fiber runs by every home. If any of you do not want this, we can't force this on you. We are not going to force this on everybody. Essentially every home in our city will have access to free basic Internet."

Google told the mayor they did want a one-time $30 connection fee to install the fiber. UTOPIA customers pay $3,000 if they want to buy the connection or they lease it for $25-$30 per month. The charge for hooking up to the iProvo is $700.

That $30 gets you all the way to a wireless router in your home, Curtis noted. "That's pretty amazing."

While many residents don't know what they would do with the gig speed, Curtis is hoping they want to have it.

"I've been a lot of places in the last 24 hours and you know what I hear -- I want to move to Provo," Curtis said. "Property values just went up."

The Provo School District is provided access to fiber at no cost and they are connected at gig speed. Google will honor that and intends to up that speed and other innovations and applications.

Google also is offering an opportunity for 25 other entities, through a special selection process, to get free gigabit Internet. The city also reserved the right through an aggressive contract to run the city and schools independently of Google Fiber if needed.

The question of other businesses that are on iProvo but will not be on Google Fiber remains to be seen.

What happens to Veracity?

When Veracity Networks took over iProvo, they made the $277,000-a-month payment on the bond. In an special agreement Veracity said they could pay $190,000 but the city would have to make up the rest. According to city spokesman Corey Norman, that agreement was for 18 months as Veracity built up business, at which point they would take over the whole payment.

"After about a year it was clear Veracity would not be able to continue making those payments," Norman said. Veracity eventually defaulted on its payments and the city took back ownership of the fiber, although Veracity continued to run the system.

Curtis said, "We renegotiated their debts several times, bought back the system from them and then hired them to manage the network."

Veracity's contract to run the Provo network was to run out in the next two months. The city extended that contract.

According to Veracity sales agents there has been a increase in customer calls wanting to know what to do. Curtis said Veracity customers should not make any moves just yet.

Veracity released a statement on its Facebook page Thursday saying the company was pleased with the announcement and anxious to hear more. No one's service should be affected in the transition.

"Google announced it would purchase the Provo fiberoptic network in a bid to bring Google Fiber to the residents of the city," the statement read. "Veracity Networks currently lends its world class services to the residents of Provo and provides its own networks and solutions for its many commercial customers and non-Provo network residential customers throughout Utah."

At the town meeting Curtis told residents, "There is a transition period here. Everybody needs to stick with their current vendor until they are contacted. In the case of Veracity it's pretty well guaranteed your contract is with the city and not with Veracity. You will be contacted when that right time comes."

What does this mean for UTOPIA?

Only good news, said the executive director.

"It's not a concern at all. Google is a great company," Todd Marriott said. He noted that UTOPIA has been offering the same service as Google Fiber for years.

"We're doing the same thing as Google -- a gigabit to every home," he said. Their goal also is to have a ubiquitous gigabit established infrastructure"

According to Marriott there aren't many differences between UTOPIA and Google Fiber. "Our offerings will be very similar in the future. I'd love to see Google on top of our other offerings and use UTOPIA. Anytime you can work with Google that's fantastic."

He added, "What Provo did was get the best deal they could get."

To the UTOPIA cities and residents Marriott would say, "Citizens should understand this validates us as an important infrastructure."

What happens now?

On Tuesday the Provo Municipal Council will vote on whether Google Fiber and Provo will join hands and travel down the technology highway.

"There could be quite a debate about whether Provo city should have done this. I've tried to stay away from that debate. My job was to fix what we did," Curtis said. "I felt it was an unhealthy debate to re-enter if we should have done it."

• Daily Herald reporter Billy Hesterman contributed to this report.

genelle-pugmire
-- Genelle Pugmire covers Provo City, Provo School District, Orem City, UDOT’s I-15 CORE Project. She also tackles variety of other topics including business features.
Read more from Genelle Pugmire here.

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