In addition to connection speeds as much as 100 times the speed of traditional broadband Internet solutions, Google (NASDAQ:GOOG) (NASDAQ:GOOGL) Fiber has the added benefit of providing customers with a non-cable solution. It's no secret cable providers like Comcast (NASDAQ:CMCSA) (UNKNOWN:CMCSK.DL) and Time Warner (UNKNOWN:TWC.DL) are at the bottom of customer service lists year in and year out.
Since the concept of Google Fiber was first announced in 2010, and started rolling out to select markets a few years later, the cable industry has continually pooh-poohed Fiber's faster speeds for a lower cost, and seemed genuinely bemused at the very notion of Google infringing upon their cozy, little world. Turns out, Google isn't content with simply stepping on cable's toes in the battle for consumer's homes, now it's introducing Fiber for small and medium-sized businesses (SMBs).
Oh, the possibilities
According to the Small Business Administration (SBA), there are over 28 million small businesses in the U.S. that account for nearly half of all private sector jobs, and over 60% of new employment opportunities. In other words, the SMB market is big, and getting bigger. Cable companies recognize the potential of business customers, and Comcast and Time Warner Cable, even as they work to wrap up their acquisition-merger deal, each have SMB-targeted marketing campaigns. Now, Google Fiber 's "Early Access Program" for SMB's enters the picture.
As is par for the course, Google's Fiber business solution is easing into the SMB market. Today, select businesses in the Kansas City, MO and Kansas City, KS markets that are within Google's "fiberhoods," have the option to kick their cable Internet provider to the curb. Even if Internet providers like Comcast and Time Warner Cable opt to bring their respective business Internet prices down to try to match Fiber, it may not matter.
Google Fiber, in addition to being a non-cable alternative, also has a secret weapon in the war for SMB's Internet business: cloud services. Business owners that opt for Fiber don't necessarily have to utilize Google's suite of cloud solutions; Fiber's "hard-wired" via its miles and miles of pipes. However, Google has made it clear with multiple price cuts and its expanding suite of services there's cloud revenues to be had, and it intends on being a major player.
Bringing Fiber to SMBs provides a world of opportunities to upsell and cross-sell appropriate cloud services in what will become a significant opportunity as more SMB markets become available. As for cable companies, they can try to discount the impact of Fiber all they want, but they're no match for Google when it comes to cloud-related solutions for businesses.
Hey, we can do that, too
Comcast CEO Brian Robert's message over a year ago regarding Google Fiber, and the cable industry's response to it, spoke volumes as to why cable just doesn't get it. At last year's annual trade show, Roberts said, "I hope there's a demand" for Fiber, which he then followed up by demonstrating a Comcast Internet connection solution even faster than Google's alternative. Which begs the question, why hasn't Comcast's ultra-fast connection been made widely available at a price point somewhere close to Fiber's $70 a month? His answer? We don't need it, nor do we want it.
Robert's comments echoed those of Time Warner Cable's then-COO Robert Markus (now CEO) nearly two years ago when he said, "If there is a demand for (faster connectivity) service we will provide it." Comcast, Time Warner Cable, and their industry brethren have since sat back and watched city after city trip over themselves to be the next in line for Fiber, and now they'll see more of the same from SMBs.
The popularity of Fiber is undeniable, however, Google faces a few hurdles before it can truly make the kind of impact on the cable industry that Fiber is truly capable of. Namely, streamlining the "approval" process for cities around the U.S., and making the actual installation process more efficient. As it stands, city governments are forced to cut through endless red tape to even be considered as "Fiber-worthy." Then there's the onerous process of installing miles and miles of pipe to bring Fiber to the masses.
But when it's said and done, Fiber for SMBs will be as successful as its consumer solution for a couple of reasons. One, its faster and less expensive than cable alternatives. Second, despite Comcast's and Time Warner Cable's refusal to acknowledge what we all know – cable's customer service record is abysmal – Fiber is a way for U.S. consumers, and now SMBs, to tell cable companies, "bye-bye."