Google Fiber selects four cities — but not yet Portland — WSJ reports
Months of courtship between Google Fiber and Portland culminated Tuesday with a big, fat “maybe.”
Where Google Fiber is going
Raleigh-Durham and Charlotte, North Carolina
Metro areas still under consideration
Portland, including five suburbs – Gresham, Tigard, Lake Oswego, Beaverton and Hillsboro
Salt Lake City, Utah
San Antonio, Texas
San Jose, California
Cities already served
Kansas City, Kansas and Missouri
“We aren’t saying ‘no,'” said Kevin Lo, general manager for the hyperfast Internet service. But they aren’t saying “yes,” either.
Google Fiber wants more time to evaluate the Portland area, Lo said. But he declined to say just how much more time Google needs, or what’s holding up its decision on adding Portland and five nearby suburbs.
“We will have updates on our progress in our potential fiber cities, including those in the Portland area, later this year,” Lo said.
Meanwhile, Google Fiber announced Tuesday it will proceed with service in four other cities that – like Portland – had been under consideration for service since February 2014. Google Fiber plans to build in Atlanta, Nashville, Raleigh-Durham and Charlotte.
Portland and four other metro areas have to wait. Nobody has been ruled out, according to Lo, who said the city and its suburbs have been good partners as the company evaluated the possibility of an Oregon network.
“I remain optimistic,” said Mary Beth Henry, director of Portland’s office of community technology. Henry, who has been coordinating the regional effort to land Google Fiber, said the company has not given any specific reason why it’s delaying a decision on Portland.
“I feel like we’re well positioned to help them have a smooth rollout once they do make a decision,” she said.
Google Fiber is shaking up the online marketplace by spending billions of dollars to build its own fiber-optic network to customers’ homes. It offers speeds up to 1 gigabit per second – 1,000 megabits per second. That’s many times faster than conventional cable and DSL Internet speeds.
In other markets, Google charges $70 a month for its gigabit service – comparable to what other Internet companies charge for considerably slower speeds. Google offers cable TV service for an additional $50 to $60 a month.
Portland and five suburbs – Gresham, Tigard, Lake Oswego, Beaverton and Hillsboro – are all still in the running, Lo stressed. But he would not go into details about why the company is ready to proceed in some places but not others.
“Every city is different,” Lo said. “There are a number of factors that influence whether we can move forward with bringing fiber to a city.”
Those factors, he said, include local topography and access to utility lines for Google’s network. The company recently asked the Federal Communications Commission to ensure it has access to existing utility poles.
State and city officials in Oregon have said they are concerned a quirky Oregon tax law could be deterring Google. The provision in the law, known as “central assessment,” levies property tax on communications companies based in part on the value of their corporate brands.
The law, which has been repeatedly challenged in court, adds millions of dollars a year to Comcast’s Oregon tax bill and might have a similar effect on Google. State lawmakers have said they plan to study the issue during the upcoming legislative session.
Lo, however, would not say whether central assessment is among the issues affecting Google’s decision on Portland.
For Portland, Google’s delay means more waiting on a civic priority that dates to the 1990s. The city has long sought alternative cable and Internet providers but has been unable to find a company that would invest the hundreds of millions of dollars to build a rival network.
Portland estimates Google would spent upwards of $300 million wiring Portland for fiber, and the company would likely enlist hundreds of contractors to build the network and hook up homes in neighborhoods throughout the city.
Even without a firm commitment, though, Google Fiber has already had a profound effect on the Portland market. Other companies are boosting speeds and building rival networks, working to get a jump on Google or perhaps deter the company altogether.
CenturyLink has begun stringing high-capacity fiber-optic cables to select Portland neighborhoods and offering gigabit service. It won a new cable TV franchise with the city and could start offering its own cable TV service this year.
Comcast, meanwhile, has doubled Internet speeds for its most popular plans. And Frontier Communications has begun offering gigabit speeds in parts of Washington County.
— Mike Rogoway