FierceCable, October 7, 2014, by Daniel Frankel
While laying down fiber-optic cable is not cheap, Google Fiber chief Milo Medin says the "single biggest impediment" to wider deployment of his company's popular broadband service is TV program licensing costs.
"It is the single biggest piece of our cost structure," Medin said, speaking at the COMPTEL fall conference in Dallas Monday, a telecom industry event covered by the Washington Post.
Medin's remarks came on the same day that the National Basketball Association announced somewhat controversial rights deals with ESPN and Turner, which will essentially triple the price those networks pay to show pro basketball games on TV and on multiscreen platforms.
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I find this article particularly interesting for three reasons:
[1] "...program rights are 'biggest impediment'.." Well, duh. [2] Milo Medin. Medin was employed at NASA's Ames Research Center in 1995 when John Doerr, a venture capitalist at Kleiner Perkins Caufield & Byers, recruited him to help found what was then known as "@Home". Doerr had conceived the idea of combining KPCB's financial resources with CATV companies to provide high-speed internet service ("cable modems") over CATV networks. Doerr hired Medin to design the technology. Wired magazine reported the story in January 1996:@Home got off to a slow start, and pundits had a field day making fun of the whole idea. But eventually @Home went live and by 2000 most large CATV systems had affiliated with it. But as time passed, @Home began losing customers as CATV companies started offering their own proprietary internet services. @Home eventually disbanded, and Medin disappeared. I posted this story on T-D in February 2009:
I never heard of Medin again until 2010 when he resurfaced as a Google VP.
[3] Pole attachment rights. Although the FierceCable article doesn't mention it, pole-attachment costs are a significant budget item for Google's fiber network, just as it is for CATV companies.Google has stated that it expects cities to offer "reasonable terms for all providers to attach fiber to any utility poles that are within the public right of way." Google Fiber City Checklist, February 2014, page 6 (*1)
I note that in the three locations where Google has chosen to build, poles are owned (or mostly owned) by a government entity that has made pole space available at what Google is willing to pay: Kansas City, Provo, and Austin.
But apparently not all cities are willing to offer Google an acceptable rate: "Four reasons why Google fiber will never come to Seattle." (*2)
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Neal McLain