Google, which was founded by two graduate students, has always made research a top priority. Now it appears that the company is turning a metropolitan area in the Midwest into its latest laboratory. The tech giant, which is building a fiber-optic network to provide superfast Internet service in Kansas City, Mo., and Kansas City, Kan., is seeking approval to provide pay-TV service there as well. The move could pit the web search leader against cable companies like Time Warner Cable.
Google’s Kansas City TV ambitions were revealed in an application for a video franchise license the company made last week with the Missouri Public Service Commission, first reported by the New York Post. For the first time, Google would control “the pipes” into the home — a major departure for a company that has always been dependent on internet service providers to deliver its products to consumers. Google could launch the service within a month or two, The Wall Street Journal reported.
“Google’s decision to enter the video market is perhaps best viewed as an experiment in video delivery and package,” Sanford C. Bernstein analysts Carlos Kirjner and Craig Moffett wrote in a note to clients Tuesday, “but perhaps also as an admission that their original proposal of a broadband-only business model is not economically viable.” Indeed, if Google is going to go to the trouble of building out a new fiber network, it makes sense to bundle additional services beyond broadband internet, and pay-TV is an obvious choice. Says the Journal:
The service would offer subscribers live TV, as well as on-demand and online access to TV channels, similar to services from major cable operators, this person said.
Earlier this month, Google began laying fiber for what it called a “high speed infrastructure” for the Kansas City area that will allow local citizens to enjoy data speeds 100 times the national average. Google’s $12.5 billion purchase of Motorola Mobility could add another piece to the puzzle: Motorola Mobility manufactures set-top-boxes for cable TV.
Meanwhile, Google is asking the federal government for permission to build a satellite antenna farm near its $800 million data center in Council Bluffs, Iowa, leading the Des Moines Register to speculate that the company aims “to receive movies and TV shows that could be bundled with the super-fast Internet service it’s developing in Kansas City.”
Or as the Kansas City Star put it, a little more vivdly: “So the Council Bluffs data center might become a giant, virtual DVR for all the customers subscribing to a Google TV service.”