Wednesday, April 22, 2015

Google Wireless: This Could Get Big . . . Eventually


             It appears that Google soon will launch a lower cost, metered wireless service.  See http://www.wsj.com/articles/google-set-to-unveil-wireless-service-1429660082.  The company has made an impact in data transmission infrastructure with Google Fiber, albeit only in the 8 metropolitan areas it now serves.  See https://fiber.google.com/about/.  Google may repeat its success on a slow and incremental basis.

            Bear in mind that Google Fiber offers facilities-based broadband competition.  At least initially Google will package and resale bulk wireless bandwidth from TMobile and Sprint.  Additionally most consumers will have to acquire one of the few handset types compatible with the service.

            On the other hand, Google has the patience and deep pockets needed to see this project through.  Google is not the first venture to resale wireless, or to combine cellular and Wi-Fi access to the Internet.  However it has the buying power and tolerance for financial losses sufficient to allow the venture to acquire market share slowly.

            Should Google Wireless reach a critical mass, the impact will be huge.  Consumers’ expectations could change in terms of what a wireless service should offer and what it will cost.  Currently consumers have to commit to data plans that add significant blocks of capacity, but at rates considered quite expensive relative to global averages. U.S. carriers can tout low data rates only by spreading high monthly costs over similarly high data monthly allowances.  Had AT&T gotten government authorization to acquire TMobile, no carrier or reseller would have offered subscribers the opportunity to carry forward unused capacity into the next month. 
 
            Google Wireless will offer a metered, pay as you go a la carte opinion that appeals to cost-conscious consumers.  If Google gets traction, expect more sponsored data plans to become available, provided the FCC does not consider them a violation of network neutrality policies.

2 comments:

Ben Cramer said...

Rob, do you have an opinion on Republic Wireless, who pioneered the cellular/wi-fi hybrid service that this new Google project has adopted?

Google's announcement yesterday included a "request for invite" and they will select small numbers of people to be early users. I made the request but who knows if it will lead anywhere. I am also considering Republic Wireless. I decided to jump ship from the "Big Four" once and for all, at least in terms of contract plans.

Ben Cramer said...

I have now (finally) received an invitation to join Google Fi. Now I have to buy a new phone at full price, but there will still be savings in the long run as compared to the Big 4. Must now wait for the new phone to be delivered. Stay tuned....