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Google Fiber: expansion predictions and effects concerning Houston

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Google Fiber is arguably the best internet in the country right now.

The difficulty for businesses to compete with 1000 MB upload and download for $70 per month cannot be understated. However, many problems in the internet industry are explained by a lack of competition from the top-down. Three of the top internet providers in the country hold around 63 percent of the internet market.

The concentration of consumers in top-level firms in this industry raises prices and lowers speeds. 

These maps perfectly illustrate problems within the industry. The largest internet providers more or less carve out their territory, and because of the large consumer base, internet in big cities might remain subpar.

Google Fiber serves not only as an excellent choice for individual internet, but as a local monopolybuster. The more competition within an area of internet service, the faster the speeds and the lower the prices. The industry is especially sensitive to competition due to artificial depression of internet speeds and providers‘ faulty marketing.

If Comcast wanted to offer gigabyte internet for cheap, they could. However, because of the lack of local competition, they do not have to diminish their profits through providing better service.

The regulation of internet marketing lags behind as well. The reason your internet only goes 15 Mbps when you bought 50 Mbps is because the provider is technically telling you the maximum download rate, while your effective rate is much lower. 

Where does Houston come into this? Houston, in terms of internet speed across the city, ranks mediocre at best, and with Google Fiber expanding in recent years, one would think Houston is a prime choice for Google.

Houston is a rare gem because it does not have any zoning laws. This means people are allowed to construct more freely within the city limits.

Therefore, Google would not have a particularly hard time laying the necessary fiberUnfortunately, Houston has far too many areas locked in longterm internet contracts, meaning even if Google Fiber came to Houston, the coverage would be sparse. 

The lack of motivation from Google also comes from their expansion philosophy. Generally, Google does not want to enter areas with too many people. The largest city in their upcoming expansion is San Antonio, which has about 800,000 less people than Houston.

Part of the expansion process for Google is negotiating with local governments to ensure the smoothest and best implementation for themselves. Relatively smaller cities retain less leverage in negotiations because of their smaller consumer base compared to larger cities like New York or Los Angeles.

Google Fiber is exactly what Houston needs to fire up the internet industry. The only way this will happen is through contract reforms and city council support. Google Fiber would be a big win even if some areas are not serviced because it would pressure other providers to offer better service.

Opinion columnist Cameron Barrett is an economics senior and can be reached at [email protected]

10 Comments

  • Do a bit more research and you may find that providers have franchises granted by the municipalities in their service areas, and you can read that as government approved monopolies if you will. It’s not always a conspiracy to turn your money into theirs and provide poor service.

  • Well that’s the problem though isn’t it. The government granted monopoly. Typically it is done at the state level since the monopolies tend to cross county lines so that means even if they want to do something to encourage competition in Houston, the state legislators have practically tied their hands. Florida is probably worse. Thus our subjugation at the hands of the evil duopoly of Comcast and AT&T. 🙁

  • I would jump to Google Fiber on DAY ONE of it being offered in Houston. Comcast costs too much and doesn’t give the speed that Google is offering, especially for the value. Google offers $70/month for Gigabit speed. WOW !!!!!!!!!!

  • Why is Houston always behind on everything. The other 3 big cities in Texas has Google Fiber. Its like we are always behind in everything. Damn it.

    • Not doubting you, but who has Google Fiber in Texas. Okay, I know Austin does, but what other 2 big cities? Hope you’re not going to tell me Dallas or San Antonio … or where?

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