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According to Rupert Wood, principal analyst at consultancy and research firm Analysys Mason, the move shows that Google is determined to influence U.S. telecoms’ policy by showing how user and service provider behavior could change under radically different conditions from those that currently prevail in the United States, and at the same time to understand how it can monetize those changes.
“Google has dabbled in access before. Its municipal Wi-Fi in Mountain View, CA, has been a flop, and its joint bid with EarthLink to provide a city-wide wireless access network in San Francisco didn’t work out. The location of these FTTH networks (serving between 50,000 and 500,000 households, according to Google) has not yet been decided. We expect Google will want to experiment with a variety of predominantly urban areas,” explains Wood.
In two key respects, Google will be offering something new with these trials.
- 1Gbit/s symmetrical access is a step change from what telcos and cable companies currently offer. It is 20 times faster than Verizon’s FiOS service, for example.
- It will provide a fully open access model to service providers, the opposite of the model used by U.S. cable and major telcos.
Michigan communities still without cable competition
Michigan's experiment with deregulation of cable services has failed, according to the Michigan Chapter of the National Association of Telecommunications Officers and Advisors (MI-NATOA), whose member communities previously oversaw local franchise agreements with cable providers.
Cable and phone companies promised that the elimination of cable regulation would increase cable competition and create thousands of jobs in Michigan. Many observers hoped that more competition would reduce prices and improve customer service.
"Communities watched in 2006 as AT&T made promises to the Michigan legislature about lower prices and more competition," recalls Caren Collins, president of MI-NATOA.
"Three years later, there is little more than disappointment. Cable prices continue to outpace inflation, and service remains poor. Eighty-four percent of communities who recently responded to a Michigan Public Service Commission survey said that they had seen no increase in competition at all, and 3 percent of the responding communities actually reported a decrease in competition. The experiment with cable deregulation is failing by every measure, because widespread, robust competition has not developed and municipalities are powerless."