Google Fiber went “live” in parts of Charlotte earlier this week, reflecting the Internet giant’s continuing commitment to its network despite acknowledged huge losses.
While the company isn’t talking on the record about a report it’s cutting 50 percent of the Google Fiber work force, WRAL TechWire is told that Google is still chasing what it sees as a huge market opportunity and that fiber as a project isn’t going anywhere other than forward.
On Aug. 17, WTW reported that GF continued to bury cable for a promised network in the Triangle.
That news came after GF told WTW was undertaking one of the largest infrastructure projects ever undertaken in the Triangle. (GF also has assured that activation of the Triangle network is coming “soon.”)
Those stories came after news broke earlier this month that Google was seeking FCC approval for testing of high-speed wireless data delivery as a means of expanding its network without continued sole reliance on expensive fiber. The Triangle was listed as one of the markets where GF wanted to conduct tests.
Then came the report Thursday about job cuts.
“Last month, Alphabet CEO Larry Page ordered Google Fiber’s chief, Craig Barratt, to halve the size of the Google Fiber team to 500 people, said the second person close to Alphabet,” the news site “The Information” reported Thursday. The story, which was based on anonymous sources, also noted previous stories that GF is pursuing less costly alternatives to fiber installation such as high-speed wireless.
Google had no comment on the record, but the news website Light Reading countered the claim.
“[A] source with direct knowledge of the situation has now responded to Light Reading about the report by saying these claims of drastic job cuts at Google Fiber are false,” Light reading said.
The Information also said GF subscribers’ count is “still well short of initial expectations.”
So what’s really happening?
WRAL TechWire went searching for answers and was provided some interesting insights by a well-connected source. Some highlights:
- GF has already said on the record it is exploring ways to speed up deployment and scale through better innovation with a hybrid fiber/wireless approach
- The recent acquisition of WebPass for its wireless technology is a good indicator of where GF is headed
- And wireless is not just cheaper but a more fast and nimble way of deployment at scale.
- Google’s mantra remains speed and scalability
- Google remains focused on providing abundant connectivity on networks that are always fast and open.
- The ultimate goal of providing abundant access to more people in a fast and scalable ways remains unchanged.
- Charlotte brings to seven metro areas where GF’s footprint is live in some areas, including Kansas City, Provo, Austin and Atlanta.
- GF continues to build in other cities/regions, such as the Triangle, and is exploring possible deployments elsewhere.
Check Google’s recent earnings conference call, it was suggested.
Google CFO outlines GF, other investments
We did. A transcript shows that Google CFO Ruth Porat noted that Google invested $280 million in its so-called “Other Bets” business group. She said the total was “primarily” for GF, “reflecting ongoing investment in our Fiber business.”
Later, Porat also pointed out: “With regard to CapEx investments for Other Bets, our Fiber investment continues to be the driver.”
Porat did acknowledge, however, that Other Bets is a drain on Google finances.
“For the second quarter, Other Bets revenue was $185 million. Reported revenue for Other Bets was primarily generated by Nest, Fiber, and Verily. Operating loss excluding SBC [stock-based compensation] was $709 million in the second quarter. Including the impact of SBC, operating loss was $859 million,” she pointed out.
While noting that “our focus on longterm revenue growth does not give us a pass on managing expenses,” Porat stressed more than once that GF and Other Bets represent Google’s long-term investments.
“Let me again emphasize that the majority of these efforts are prerevenue,” she said. “We continue to invest across these opportunities and are doing so in a disciplined way.”
Read the Light Reading story at:
Read The Information story at: