Google Fiber Has Time Warner Cable Tripping All Over Itself

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Before Google (NASDAQ: GOOGL  ) rolled out its new, lightning-fast Internet service in Shawnee, Kan.; Provo, Utah; and Austin, Texas, Fiber seemed little more than one of the search giant's playthings -- like self-driving cars or home delivery services.

Last month's article, written shortly after Google announced it was heading to Austin -- before Provo and Shawnee were thrown into the mix -- discussed the "what ifs" of Fiber and its impact on the future of cable. Today, there are no more "what ifs." Fiber's real, it's going to generate revenue for Google, and it will change the way cable operates, in spite of what Time Warner Cable's (UNKNOWN: TWC.DL  ) CEO Glenn Britt says.

Did he really say that?
It was only a week ago Britt was quoted as saying of Fiber: "they have a glow about them ... [but are] no different than other overbuilders that have failed to overtake cable operators." Really? Then why did Britt's Time Warner Cable, shortly after Fiber landed in the Kansas City area, increase its Internet connectivity speeds for customers and drop the monthly fee from $45 to just $30 a month?

Also curious, particularly for a cable provider that called Google Fiber nothing more than "imagery painting" after it was announced Fiber was coming to Austin, was Time Warner Cable's decision to offer its Austin area customers free Wi-Fi access. The free Wi-Fi will require installation of hundreds of hotspots in Austin, but Britt and Time Warner Cable have apparently become all about customer service.

A dose of reality
Along with airlines, the cable industry consistently ranks among the worst for customer service, year in, year out. The animosity consumers feel toward the cable industry is across the board -- Time Warner Cable finds itself on most of these lists, along with competitors including Comcast (NASDAQ: CMCSA  ) and Charter Communications (NASDAQ: CHTR  ) . Both Comcast and Charter have the distinction of owning even lower customer service ratings than Time Warner Cable, and that's saying something.

As Time Warner Cable made evident in Austin recently, upping Internet connectivity speeds is a viable alternative, as are lower prices, so what's preventing Charter, Comcast, and Time Warner Cable from enhancing their respective services? No need, at least for now. All three of the cable big boys enjoyed year-over-year growth in their Internet businesses in 2012. Charter saw an 8% jump in Internet customers in 2012, and both Time Warner Cable and Comcast increased Internet revenues in 2012 compared with the prior year, by 13.7% and 9.2%, respectively.

With those kind of results, along with margins as high as 97% according to a Bernstein analyst, getting the cable industry to change Internet strategies wasn't likely -- until Google Fiber entered the picture, that is. Now, in spite of what cable executives like Britt are saying, their actions tell another story.

For consumers, Google Fiber is a no-lose proposition. Either customers will see continual improvements from cable providers -- as Austin and Kansas City have -- or will wait for Fiber or Fiber-like alternatives to become available and jump ship. Based on annual customer service rankings, Britt and his cable industry cohorts should stop pooh-poohing Fiber and start implementing a comprehensive strategy to retain their customers. But don't count on it.

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Read/Post Comments (15) | Recommend This Article (8)

Comments from our Foolish Readers

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  • Report this Comment On May 04, 2013, at 11:46 AM, raymondfoster08 wrote:

    GOOGLE WE NEED YOU IN GEORGIA!!! WE NEED YOU IN NY, AND WE NEED YOU IN CALI!!! you will right the wrong that these companies have done to us with no regard, and respect...we are tired of being economically molested...

  • Report this Comment On May 04, 2013, at 11:54 AM, gimmethefacts wrote:

    Go Google!!!

  • Report this Comment On May 04, 2013, at 11:55 AM, gimmethefacts wrote:

    You will be in Provo, but could you please move further up north to say Salt Lake, PLEASE!!!!

  • Report this Comment On May 04, 2013, at 12:08 PM, amosnme wrote:

    Please come quickly to Maine and New England. TWC has a monopoly here. Any other company with a different name still can be followed back to Time Warner, so, since they are the only game in town, they price their cable and other products as high as they want to. We need Google Fiber!!!!!!!!

  • Report this Comment On May 04, 2013, at 12:08 PM, shuckamuck wrote:


  • Report this Comment On May 04, 2013, at 12:26 PM, tweeter31469 wrote:

    I will jump in with Google the moment they cease their data-mining operations. Until then, I have become very careful to avoid using any service they offer.

  • Report this Comment On May 04, 2013, at 1:14 PM, btc909 wrote:

    Go the Apple route TW. Sue Google! I wouldn't miss Verizon FiOS ever inching up pricing.

  • Report this Comment On May 04, 2013, at 2:13 PM, LadyMantle wrote:

    The only thing TWC has going for it is the broadband internet. So Google offers a little lower monthly charge, so what. If they really want to compete with the other cable companies, they should start streaming better programming over the internet than TWC. The programming these cable companies provide is horrible and its off the charts in price. I would like to see unlimited 4G service for an affordable price. 4G is the future and its lightening fast.

  • Report this Comment On May 04, 2013, at 3:03 PM, chelbelle64 wrote:

    Chattanooga TN has had fiber optic internet, television and phone for over 3 yrs. With speed up to 1000 mbps. Google is just taking credit of Chattanooga's intervention in technology. Minimum personal internet speed is 50 mbps and it is very reasonably priced and I personally have never had a problem with it.

  • Report this Comment On May 04, 2013, at 4:43 PM, donicus wrote:

    Google Fiber isn't in Shawnee, KS yet. It IS coming soon. I live in Shawnee and believe me, if it was here, I would have dumped U-Verse already.

  • Report this Comment On May 04, 2013, at 6:18 PM, TheOldRanger wrote:

    Please get Google fiber optics up to NW Ohio as soon as you can. I truly dislike TW and I hate Dish, and we definitely need something that is more reliable, more customer friendly, etc. Hurry, hurry, hurry... I'm sure there are thousands of people up here who would switch as well.

  • Report this Comment On May 04, 2013, at 6:40 PM, NewsFreakoid wrote:

    TWC only aims for customer servicing? HA! As a former TWC customer, customer servicing was their least priority... I couldn't get them to pick up the phone after 1 hour of hold... and when I finally get someone on the line, I had to argue because the representative gave me nothing but an attitude. I moved back to Verizon and I prefer Verizon's worst customer service than TWC.

    If Google Fiber comes here, then it will be a miracle.

  • Report this Comment On May 04, 2013, at 8:06 PM, redheaded52 wrote:

    Please, please, please Google, we need Fiber in NE Ohio. TWC has paid off so many local politicians so no other cable company can provide service in select areas. It is a monopoly and I don't understand why they've been able to get away with it as long as they have. FIBER NOW

  • Report this Comment On May 07, 2013, at 1:48 PM, NotoriousPhD wrote:

    LadyMantle, you obviously don't know anything about service providers. 4g is with phone services and does the same thing as broadband but for phones. Ignorance like yours truly upsets me. Google is not only offering a cheaper service, it's a much MUCH faster service. For comparison, the average Internet speed is 7mbps download, and less than a megabit per second upload. The average cost of these plans are usually $50, higher speeds like 50mbps down 5mbps up are like $120 a month. 4g lte speeds top out at 50mbps at the current times. Google fiber offers 1000mbps down and up, so literally 100s to a 1000 times faster than current speeds. This is revolutionary.

  • Report this Comment On May 18, 2013, at 1:50 PM, spence80 wrote:

    Writing this from my crummy $75 a month Time Warner connection that went down for hours last night. Google can't get out there fast enough and save the consumer from out of touch internet "service" providers.

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