Last week it was reported Google (NASDAQ:GOOG) (NASDAQ:GOOGL) purchased of a small company, Alpental Technologies, that's working on 5G wireless network connections. While Google kept the acquisition quiet, there may be some big opportunities Alpental's technology could open up for Google -- specifically, with the company's Google Fiber ambitions.
Skimpy on the details, heavy on the speed
According to a report by The Wall Street Journal, Alpental was working on a way to utilize the 60GHz band of wireless spectrum to deliver cheap, high-speed Internet.
Last summer the FCC opened up the wireless spectrum between 57-64 GHz, allowing wireless broadband to be sent via the spectrum at a distance up to one mile and at speeds up to 7Gbps. This would make Alpental's technology an ideal way for Google to boost its gigabit Fiber network. The company's tech can be used with 5G networks (the next iteration in wireless after 4G) as well as Wi-Fi, which could result in Google having to put less fiber in the ground, while still expanding its network.
Google isn't saying much about the acquisition though, only offering up to GeekWire that it can "confirm that we're excited to welcome the Alpental team to Google, and that they joined a few weeks back, but we don't have any other details to share."
Why this matters
Google has made it clear that it wants to expand its Google Fiber network and bring the service to more areas of the U.S. Right now Fiber is only offered in Kansas City, Missouri, Provo, Utah, and soon Austin, Texas -- with more than 30 other cities potentially receiving the high-speed Internet in the future.
Google believes if it can offer people ultrafast Internet at competitive prices, then it can potentially offer users more of Google's apps and services, and bring in more ad revenue. Google has said it wants to bring Fiber to customers to create a better marketplace for fiber Internet, which has lead AT&T to launch its own fiber networks in some of the same cities as Google.
For Google investors, this latest acquisition really won't change much. Google Fiber, although something the company appears committed to, is a very small part of the company right now. Even if the Alpental acquisition boosted Google into 5G and extended its Fiber reach, it still won't change much -- if anything -- on the company's bottom line. Google's long-term play may be the bigger picture here. If it can start controlling more of how users access the Internet, then it can potentially make more money from its users when they access its services. But with the company's Fiber service rolling out slowly, and AT&T now competing directly with Google, it could take a while for that to happen.
Chris Neiger has no position in any stocks mentioned. The Motley Fool recommends Google (A shares) and Google (C shares). The Motley Fool owns shares of Google (A shares) and Google (C shares). Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.