Follow us:

Brier Dudley's blog

Brier Dudley offers a critical look at technology and business issues affecting the Northwest.

April 20, 2014 at 10:54 AM

Google inks Portland deal, time for new approach?

As Seattle tries to figure out how to improve its broadband situation, it ought to keep an eye on its sister to the south.

Image of "Portlandia." Photo from IFC/Frank DiMarco.

Image of “Portlandia.” Photo from IFC/Frank DiMarco.

Portland is getting hot and heavy with Google, which may bring its fast fiber broadband service to the Rose City as early as 2015.

Last week, Portland reached a preliminary franchise agreement with the online giant and will begin public deliberations on the deal in May, according to The Oregonian.

Google announced in February that it plans to bring its fast-fiber broadband and cable-TV service to Portland and five surrounding cities.

But first Portland and the neighboring cities must sort through the same neighborhood issues that Seattle now faces with CenturyLink and other broadband providers demanding special treatment and more access to public property.

Google may be an exciting newcomer to the telecom business but in its dealings with cities, it acts like a crusty old player in the industry.

In Portland, Google is twisting arms by offering its fast broadband in return for city handouts, just as CenturLink is doing in Seattle.

Google doesn’t want to abide by current restrictions on the placement of metal utility cabinets on parking strips in front of people’s homes, according to Oregonian reports.

That’s not all. Google is going further and requesting that Portland give the company swaths of public property to place garage-size “network huts” — with a 12- by 28-foot base — to support its project.

Companies starting up a new venture generally have to find and rent private property. Google could afford to do the same; it’s now making more than $1 billion a month in profit. The day after reaching the deal in Portland, it reported a net income of $3.45 billion the previous quarter. It also appears to have a limitless budget for building amenities at its glorious offices.

Yet Google expects cities to basically hand over public property for its fledgling broadband and cable-TV business.

Cities are pushovers when it comes to broadband. The way politicians talk about it, you’d think their constituents were stuck in the dark ages and broadband was as important as the fire department.

Whether it’s a crisis is debatable. But a crisis mentality is what’s used to justify extraordinary measures, like giving Google, CenturyLink and others what they want.

If there really is a crisis, and broadband has become a critical service on par with water and electricity, cities should consider providing the service directly as a public utility.

Perhaps it’s also time for the federal government to classify broadband as an essential public service that must be available to everyone.

After phone lines were deemed an essential service, the government required companies to provide “universal service” so everyone was served.

Broadband was exempted from universal service requirements, support for which has eroded since telecom deregulation took hold in 1996.

With telecom companies in the driver’s seat, and elected officials begging them for a ride, universal service seems off the table. It’s treated as a dusty, antiquated concept that will impede progress and the arrival of sexy new products like Google Fiber.

Google Fiber is appealing and has plenty of cheerleaders on social media and at City Hall.

Yet Google is a mixed blessing. The majority of residents in any city would probably rather get broadband service from a public utility that’s accountable to them, instead of from a fairly opaque company that makes its money delivering hypertargeted advertising.

Privacy concerns are offset by the prospect of a wealthy company stepping in to help address a complicated infrastructure challenge. Still it’s a business, not a gift, and city officials should push to make sure all of their residents benefit from the deals they make.

That’s not going to happen in Portland, apparently. As it has in other cities, Google is retaining the right to pick and choose which neighborhoods get wired and which are left behind.

This is couched in clever, Google-y terms — the service is coming first to “fiberhoods” that express interest in the service.

But the effect is to pit neighborhoods against each other and enable the company to cherry-pick lucrative pockets of a city where people are willing to pay $70 a month or more for broadband.

This approach is also tilted in favor of residents and neighborhoods that are already the most tech savvy. They’ll get service first — and perhaps exclusively — because they can best use the Internet to call attention to themselves.

What’s really sad is that tech-savvy neighborhoods may already have relatively good service and are likely targeted for upgrades by existing providers.

This isn’t hypothetical. A digital divide has surfaced in Kansas City, where Google first began offering fiber broadband service in 2012, after taking applications from cities across the country.

Two other cities, Provo, Utah, and Austin, Texas — are getting the service. Portland is among nine now being considered by Google.

In Kansas City, Google offers gigabit speed connections — 1,000 megabits per second — for $70 per month, plus taxes and fees. A bundle with TV service costs $120 per month.

That’s a nice deal where it’s available. But the company has been slow to expand its coverage area in Kansas City and vague about if and when it will reach some working-class areas, according to a report in The Kansas City Star.

Cities really have one opportunity to ensure that all of their residents will be served by these next generation broadband services.

That’s during the initial franchise negotiations, when cities can press for universal coverage in return for the special rules and public property they’re offering up.

Once cities provide these handouts, they don’t have much leverage. They’ll end up bowing and scraping and hoping that Uncle Google throws a bit more fiber their way, someday.

The experience in Kansas City — where suburbs are stuck waiting for Google to extend its fiberhoods — suggests that cities in a region targeted by Google Fiber should work together on setting expectations and deadlines.

Yes, a provider like Google may abandon a city that doesn’t play along.

But is that such a loss if the company ends up cherry-picking and making the market less attractive to other providers — including public utilities — that might come and provide fast broadband for everyone?

Even a limited rollout of Google Fiber and vague plans to expand may goad Comcast and the phone companies to up their broadband game in cities like Portland.

It’s still surprising, though, that a place known for demanding humanely raised organic produce wouldn’t also ask Google for universal service.



No personal attacks or insults, no hate speech, no profanity. Please keep the conversation civil and help us moderate this thread by reporting any abuse. See our Commenting FAQ.

The opinions expressed in reader comments are those of the author only, and do not reflect the opinions of The Seattle Times.

The Seattle Times

The door is closed, but it's not locked.

Take a minute to subscribe and continue to enjoy The Seattle Times for as little as 99 cents a week.

Subscription options ►

Already a subscriber?

We've got good news for you. Unlimited content access is included with most subscriptions.

Subscriber login ►
The Seattle Times

To keep reading, you need a subscription upgrade.

We hope you have enjoyed your complimentary access. For unlimited access, please upgrade your digital subscription.

Call customer service at 1.800.542.0820 for assistance with your upgrade or questions about your subscriber status.

The Seattle Times

To keep reading, you need a subscription.

We hope you have enjoyed your complimentary access. Subscribe now for unlimited access!

Subscription options ►

Already a subscriber?

We've got good news for you. Unlimited content access is included with most subscriptions.

Activate Subscriber Account ►