Google Touts Potential for Wireless Broadband

Google Fiber ‘a huge market opportunity,’ Alphabet CFO says
Google fiber logo with bunny.jpg

Google Fiber will push both wired and wireless technologies as it pursues “different execution paths” for the delivery of high-speed broadband services, Ruth Porat, CFO of Google parent company Alphabet, noted Thursday on the company’s Q2 earnings call.

Google Fiber’s wireless angle came up when an analyst questioned the speed at which the ISP has been able to deploy services in markets such as Austin, Texas.

“We continue to see Fiber as a huge market opportunity,” Porat said. “We're also continuing to push the frontier with tech innovation, as you noted in your question, and different execution paths”

Porat emphasized that the company is “exploring both fiber and wireless,” referencing Google’s recent acquisition of Webpass, a company that specializes in wireless broadband delivery in markets such as San Francisco, Oakland, San Diego, Miami, Chicago and Boston.

The addition of high-speed wireless to the arsenal could help Google speed the deployment of services while also reducing infrastructure costs. Notably, Verizon is expected to pursue the rollout of gigabit-capable “wireless fiber” services as it begins to target early use cases for emerging 5G technologies.

“We want to make sure we're executing against a very large and attractive market in the most effective and efficient manner,” Porat said. “We're being thoughtful and deliberate in our execution path.”

The analyst who posed the question, Bernstein Research’s Carlos Kirjner, said in research note today that he believes it is “highly likely” that Google Fiber will add cities to those that are under consideration as well as the number of cities where it intends to deploy.

“We believe Google Fiber incremental capex can easily exceed $1 billion next year, depending on how fast Google builds out and markets its service,” he wrote, noting that $1 billion is less than one month of free cash flow at the deep-pocketed company.

“Other Bets,” the Alphabet unit that includes pre-revenue “moonshot” projects like self-driving cars and other early-stage, longer-term businesses like Google Fiber and Nest, saw revenues rise amid wider losses in Q2.

Google also offered some small updates on other projects.

Sundar Pichai, CEO of Google, said the company was moving ahead with Daydream, the company’s new Android-based virtual reality platform.

“We are already working with leading Android partners to build out the Daydream ecosystem, so stay tuned for more Daydream-ready phones, controllers, and headsets coming this fall,” he said.

Pichai also announced that Google has sold more than 30 million Chromecast streaming adapters.