"Cable and telephone company incumbents remain reluctant to upgrade to highest speed broadband networks - especially the much-touted Gigabit-per-second infrastructure - unless they face competitive threats, notably from Google Fiber, says the third annual report from Gig. U.
"It's not an accident that there is a tremendous overlap between where Google is looking at entry and where incumbents are looking at upgrades," according to the just-issued "From Gigabit Testbeds to the 'Game of Gigs," "It's not an accident that Comcast, Verizon and Time Warner [Cable] have recently announced speed increases, with a focus on communities where gigabit efforts by other are proceeding."
The report, written by Gig.U executive director Blair Levin, cites a game-like domino effect where a gigabit announcements from one company create pressure for existing operators to plot their own ways for "delivering bandwidth abundance." The process has generated skepticism about "Fiber to the Press Release," as the report characterizes such empty promises. Many of the operators have not revealed capital budgets that demonstrate new investments to upgrade networks to gigabit capacity, says the analysis. But it gives ISPs leeway for such weak commitments, acknowledging that companies only reveal their spending plans when "they can justify the expenses in light of a new opportunity to defend an existing revenue stream."
The report calls the current fragmented landscape of Gigabit deployment a "Game of Gigs," citing announcements and actual development that are in part propelled by the independent community-initiated efforts (a mainstay of the Gig.U concept). Comparing the high-speed Gigabit deployment to HBO's Game of Thrones where royal families fight for supremacy, the report intones that, "In the real-life 'Game of Gigs," powerful companies ... fight for supremacy in broadband services." The "Game of Gigs" report features cover art that depicts a throne of swords exploding out of (or squeezing into) a metal tube - an artistic adaptation using an image from HBO's Game show.
"Now numerous providers, including some incumbents, are developing strategies to deploy networks capable of providing abundant bandwidth and challenging others to enter a new growth-oriented 'Game of Gigs," according to the report. The report assures that, "We [don't] regard any of the actors in the broadband battle as occupying the same immoral universe" as the "Game of Thrones" characters.
It singles out "Google Fiber" as "the prime force in driving" the increasing gig announcements from competitive providers.
"Google's entry into the next generation broadband market is the single greatest input driving a number of competitive response," says the report. "If Google were to withdraw or even just indicate that it was not proceeding further, incumbents and others would likely slow down their own efforts and progress would likely stall."
Gig.U has been working since 2011 with three dozen research university communities to accelerate the deployment of "next generation broadband networks." Levin, who led the Federal Communications Commission's 2009 task force that produced the National Broadband Plan, as is his wont, frequently references the Plan. He interprets some recent gigabit efforts by cable and telecom giants as representing "a positive change in their perceptions of both the opportunity and the threat" by community groups and rival companies, such as Google.
A chart deep into the 34-page report depicts markets in which several providers have promised gigabit service, including Salt Lake City, Portland, Phoenix, Los Angeles and San Francisco.
"A year ago ISPs such as Cox and Time Warner Cable were antagonistic toward gigabit upgrades," Levin's report continues. "They responded to gigabit initiatives with comments suggesting that upgrades were too expensive, and further, that they knew best what their customers wanted."
"Now they are singing a different tune," says the report, pulling its punch by saying that this is not a criticism. "Rather they deserve credit for recognizing how the landscape has changed," especially "the "poplar demand for faster speeds."
The report notes that Time Warner Cable plans to deploy "TWC Maxx" service in seven markets in 2015, delivering speeds up to six times faster than current facilities.
"Though TWC won't be offering gigabit speeds, the significantly faster speeds will be a drastic improvement over current offerings," the report says.
The Gig.U report acknowledges "threats to success," including the prospect that Google could withdraw its competitive threat. "We recognize that this business line is not core to Google's current revenue model and it has the option of simply not proceeding with further deployments."
The Gig. U. report singles out Bright House Networks for its upgrade announcement to offer gigabit service to 6,000 homes in a Tampa area new-build community, and Time Warner Cable's Los Angeles plan to deliver gigabit speeds by 2015. But it points out that TWC's announcement came months after the city of Los Angeles issued a Request for Information for such service and AT&T expressed interest in building its GigaPower service in L.A.
The report also acknowledges that the current merger plans (such as Comcast/Time Warner Cable) could stymie companies' gigabit agendas.
The report cites academic and community project such as the non-profit "OneCommunity" project originating from Case Western Reserve University in Cleveland and a project in Gainesville, Florida, in collaboration with the local power utility. It chronicles other gigabit projects in academic communities such as Blacksburg, VA, Urbana-Champaign, IL, and East Lansing, MI.
The report cites Kansas as having year-over-year "97% improvement of its speeds to 34.4 Mpbs, the largest jump in bandwidth of any state in the country" since Google announced its plans to put fiber into Kansas City.
It also cites plans for Phoenix, Las Vegas and Omaha, which are currently targeted for gigabit service by both Google and CenturyLink, which it calls "another demonstration of the importance of competition in accelerating network upgrades."
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