Google Fiber Gives Up On Traditional TV, And Won't Be The Last Company To Do So
from the adapt-or-perish dept
While Google Fiber was initially hailed as the be-all-end-all of broadband disruption, the bloom has come off the rose in recent months. Last fall, Google executives began to have doubts about the high cost and slow pace of the project, resulting in a not-yet cooked pivot to wireless and the departure of two CEOs in less than a year. Company PR reps seem unable to answer basic questions about cancelled installations and the unsteady direction of the project, which has also faced more than a few obstacles erected by incumbent ISPs unhappy about the added competition.
But Google Fiber has another problem: the slow but steady death of traditional television.
We’ve noted for some time how smaller cable companies are considering getting out of the pay TV business, since they lack the size and leverage to get the same rates enjoyed by sector behemoths like Comcast NBC Universal. Ultimately, you’ll see many of these smaller cable companies shift their focus entirely to broadband, while nudging users toward over the top streaming services. As a smaller pay TV provider, Google is no exception, announcing last week that the company would be removing pay TV service from its service bundles moving forward:
“…We?re trying something new in our next two Fiber cities. When we begin serving customers in Louisville and San Antonio, we?ll focus on providing superfast Internet – and the endless content possibilities that creates – without the traditional TV add on. If you?ve been reading the business news lately, you know that more and more people are moving away from traditional methods of viewing television content. Customers today want to control what, where, when, and how they get content. They want to do it their way, and we want to help them.
That’s a nice way of saying users weren’t buying what Google Fiber was selling. The company doesn’t reveal subscriber numbers, but while analysts have estimated Google Fiber’s broadband subscriber count at somewhere between 500,000 and 1 million, the company’s total pay TV subscriber count has long been relatively pathetic, with just 100,000 pay TV customers since the project’s 2012 launch. Moving forward, Google Fiber makes it clear the company will stop fighting the current and nudge users to streaming alternatives instead:
Whether it?s through YouTube TV, Hulu, Netflix, or more specific targeted services — there are so many ways to watch what you want, when you want it. And Google Fiber?s superfast Internet allows customers to make the most of all these streaming choices by providing the bandwidth to use multiple devices and apps at the same time.
What this means for Google Fiber’s existing pay TV customers isn’t clear, but it seems likely they’ll ultimately lose service and be shoved toward discounted subscriptions for YouTube TV, Google’s new live streaming video platform. But Google Fiber won’t be the last pay TV provider to give up on traditional TV. We’re entering a new era of mindless merger mania where we’re intent on ignoring lessons of the past, making it increasingly difficult for smaller companies to gain a foothold in markets dominated by the likes of Comcast NBC Universal, or soon — AT&T Time Warner.
And while Google Fiber hopes to have better luck focusing on broadband and streaming video, that’s not an easy path either. These same TV sector giants (AT&T, Comcast) also have a growing stranglehold over streaming video licensing as well as the telecom market. And with the government gutting net neutrality and other protections beneficial to consumers and small businesses, getting a leg up in the broadband sector will soon be even more difficult than ever — especially for those that lack Alphabet/Google’s political power and healthy cash reserves.
Filed Under: broadband, competition, google fiber, tv
Comments on “Google Fiber Gives Up On Traditional TV, And Won't Be The Last Company To Do So”
Surprise, Surprise -- NOT, lol
After reading repeatedly about the ‘fake news” (per Nielsen) “cord cutting” revolution and “cord nevers” here on techdirt, we are supposed to act surprised at this?
Especially when there’s a virgin (never seen broadcast or cable TV on it, only DVDs) TV in my living room?
Cable companies charging more every year
Comcast and other cable companies that also own tv channels are raising the cost to everyone year over year and passing the paper cost on to consumers. In reality they cost nothing additional to broadcast and the difference is all going towards their record breaking profits. They claim that regulation will drive them to bankruptcy yet then turn around and crow to their investors about how it was another banner year. You can’t have both at the same time and then claim that you need to put caps arbitrarily. I have no doubt they will spend billions to kill off future competition, ensuring they are the only option. Hypnotoad cable companies will be the inevitable future.
Pound another nail in the “traditional TV” coffin. Keep the box of nails handy; we’ll need another soon. It also means that broadband providers are going to be stepping up the implementation of usage caps and price hikes as the nails get used.
Re: Another Nail
Current standard Digital TV (DTV) has a lot of long term potential for cord-cutters
DTV can deliver lots of HD programming,long range, at low cost (relative to buried-cables)– to millions of viewers in local areas. And it’s free to viewers.
I cut the cord 3 years ago. I get all the major broadcast channels from their transmitters 40-50 miles away… using a simple indoor antenna and amplifier. Also get 40 minor channels. Works great.
That proven technology has much potential for delivering one-way quality content to consumer TV sets. Conventional TV ain’t anywhere near a need for coffin nails!
Re: Re: Another Nail
There is a generation growing up that have not caught the TV bug, because they watch what they want, when they want, and preferably with the ability to interact with the content providers on places like YouTube. The Idea that they should watch on somebody else’s schedule, and with constant interruptions for adverts, has no attraction to them.
It is not so much the content, but rather the need for scheduled programming and watching that will kill traditional TV.
Re: Re: Re: Another Nail
…well, “Free” still seems to have much consumer appeal
how come AM/FM Radio is still popular — aren’t listeners also stuck with the broadcasters schedule rather than their own ??
Re: Re: Re:2 Another Nail
Often they are also stuck in the regular commute to work, where radio is useful for notifying them of traffic problems.
Also radio mainly plays news and music, and only rarely serialized stories, so miss a program and you miss nothing, unlike a TV series, where missing an episode is a problem. One reason I never acquired the TV habit was that I was working shifts, and there was little point in getting into a series.
Re: Re: Re:3 Another Nail
Yeah, radio used to play serialized stories but that mostly ended a long time ago.
Re: Re: Re:4 Another Nail
….Wow ! How old are you guys (?) — serialized radio shows faded out about 1950
“Talk Radio” is really big these days… as well as sports and all types of FM music
‘News & Weather’ do not dominate radio — I don’t think you guys listen to radio much
Re: Re: Re:5 Another Nail
You don’t think that was a long time ago? We’re obviously not as old as you then.
Re: Re: Re:5 Another Nail
“…Wow ! How old are you guys (?)”
The Shadow knows
Re: Re: Re:5 Another Nail
serialized radio shows faded out about 1950
In the States, maybe.
Re: Re: Another Nail
I’m getting the latest ATSC channels from a cheap ($50, owned) antenna inside my apartment. That and a decent TV makes sporting events amazing to watch!
I could probably PVR that and never worry about having something to watch again, if I had the GBs. Surprised more people aren’t trying to kill the stuff that’s free, because it looks/sounds better than the old by-wire plan my folks had years ago.
Re: Re: Another Nail
ATSC broadcast is truly wonderful, isn’t it? It blows my mind how the sound and picture quality manage to be better than cable and satellite. Sure, there aren’t as many channels but who realistically watches all 8,000 of the channels the big providers offer, anyway?
Future versions of the ATSC spec are gonna be even more strange. Apparently, it’ll allow for interactive broadcast television to be a thing. It’ll even have apps. I’m still trying to wrap my brain around it.
Re: Re: Re: Another Nail
In the future it will even allow teleporting, like in Star Trek!
Re: Re: Re: Another Nail
The technology allows cable companies to include the full broadcast signal, but they prefer to recompress and cram extra channels in.
Don’t be too hopeful. DVD supported that from the beginning but it’s rare to see anything "interesting". It’s just used for onscreen menus before the videos start. (Other obscure features include "alternate angles", rarely used in non-pornographic videos.)
"Interactive TV" was pushed as the next big thing in the early 90s (to quote the 1994 film Speed: "Interactive TV, Jack! Wave of the future!"). Some theaters tried interactive movies… not for long.
I do see this as a net good thing; but I also fear more fragmentation. Now that it will probably require several subscriptions to paid services to do what TV once did, we’re back where we started with too many things to watch, but now with no way of paying to get all our preferred shows together… mostly…
Too much of everything in one place means one corp. is getting the biggest slice of the money pie, but the convenience would really help everyone. But I’m in no hurry for any online choice to become a “one-stop shop”, because that means less fair competition and less of an ability to haggle for better prices.
If YouTube actually had its shit together, it might be a good choice, but they’re gradually losing their appeal by becoming TV Lite. The appeal of YouTube was that they were never going to be TV, but if they go down that sanitized path, they’ll eventually be even weaker than other players like Netflix.
Fragmentation is a real issue. Some people will see the positives, and some will see negatives as well.
To me it comes down to, in some ways cutting out a middle man. Cable companies are, in many ways, nothing more than an aggregation middle man. In theory if you cut them out, you can pay less.
But I don’t think it’s that simple. From what I can tell, many of the cord cutters are doing so with the help of Roku boxes, pirate streaming, and the like. It’s a wonderful idea when there is enough content being produced in other places to “borrow”. As more people cut cords and pay a whole lot less for content by essentially buying less, they may end up biting the hand that feeds them.
CBS has already made the first move with the new Star Trek series. Making that an “internet only” series (in the US, it’s on TV in Canada, example) means they are driving people to sign up for their all access package. For people still paying cable, it’s an extra cost, and for cord cutters, it’s another bite into your “savings”.
As each of the existing players gets into this, it’s going to get expensive to subscribe to each service separately. What will end up happening is that new middle men will pop up to aggregate the content, and you will once again end up signing up for monthly packages with channels you don’t really want, in order to get the ones you want cheaper.
Aggregation is a natural state of affairs. As you say, fragmentation is a real issue, and it will always be addressed in the same or similar manner – aggregation.
Re: Re: Re:
CBS will also get plenty of people like me who simply don’t watch the new Star Trek series. I’m ready to admit I’m a fan of the franchise in general, but with it locked behind a paywall plus commercials, it’s not for me. Plus all the people with capped/slow/non-existent broadband will not see it.
Re: Re: Re: Re:
It is funny how hollywood thinks that everyone wants to watch all of their products. If it tanks at the box office it must be due to piracy, if it tanks at the next release cycle it must be due to piracy
because everyone wants to watch our movies!!!
Re: Re: Re:
Maybe they will go the unified route. But getting that aggregation fairly is something those companies will eventually have to deal with. But I’m no fool, they’ll delay and delay the idea of having a truly unified TV-esque online service because it means less money for them.
However, if it comes to either many people NOT buying all those webTV subscriptions vs. creating such a service, maybe time will force their hand. Maybe it’ll come when I’m too old to do much else but watch TV…
Re: Re: Market, as much as aggregation
We got cable and pay TV as much because broadcast signals did not reach rural and suburban America as because of aggregation. Aggregation mostly reduces transaction costs — establishing trust, locating what I want, and the number of diparate entities and policies I have to deal with.
From a market efficiency perspective, the cable and satellite TV providers are broadcasters with a narrow upload pipe, and the explosion of full two-way pipes and interesting content.
Though they are fighting it, the new choices reduce the economic rent that can be extracted from their offerings, and the model of paying for every choice (bundling so you have to get ESPN even if you really only wanted the history channel, and god forbid you want to try something for ONLY ONE MONTH) is rapidly becoming untenable.
It is becoming an open question, with the miraculous copying machines our internet-connected collections of computers have become, how long it will be practically possible to charge for content at all, irrespective of the copyright laws.
Re: Re: Re: Market, as much as aggregation
If your remarkable copying machine gets a little too efficient, it will take away too much of the money that pays to make the original. After that, you can copy the blank space, or enjoy the cat videos on YouTube.
Re: Re: Re:2 Market, as much as aggregation
If your business model is to make a fortune by being a gatekeeper gaining control of the works of the few creators that you choose to publish, the the Internet is an existential threat to that business model, especially as those who you reject can go it alone as self publishers.
Copyright is not necessary for new content to be created, and indeed content can be given away. What people will pay for, and the idea that underlies patronage, is that it is worth paying people to create new content. That is patrons invest in the future, and support people to keep on producing.
Also, you appear to be under the illusion that people only crate new content because they can make money from it, when in reality there are many other reasons for creating. Now that the cost of the equipment needed to do so has fallen to where anybody can afford to engage in content creation, and they have a way of reaching an audience, much more content is being created and published, just because people like telling stories, or sharing their expertise.
@ Google Fiber
Google? GOOGLE?!?! Corporations! Pirates! Blaaaargha seventy-two attempts! Masnick — y u no DEBATE me?!?!?!
Re: @ Google Fiber
…Nah, this can’t be the real out_of_the_blue. Too honest.
Tit for Tat
If T-mobile can include Netflix now for subscribers, surely Google Fiber can throw in YouTube Red and YouTube TV for free to subscribers. Why even bother charging for TV content when you can get juicy delicious consumer data for free, amiright? Put the screws to Neilsen!
I’m on Google, and their problem is not the TV, or the internet. It’s the other services. Att, rr and others bundle their customers on the same frequencies as the Google users. And that slows everyone down. I have to change frequencies almost monthly, and the other services move their customers to recover those frequencies that I move to. But, those days till the change frequencies are worth it, blazing fast, no waits, no cutdowns, no circles, or 720 or better video, but I can tell, when the others join in the changes, goes back to 480 or less on the sets, pixels dropped, stalled screens. Just like when I had att, and rr. But, their tv, even as a direct line, suffers then, even wired in, haven’t figured that one out yet.
Re: Goo problem?
Are you a WISP user? What frequencies are you changing?
Re: Goo problem?
That’s the frequency, Kenneth?
The answer's transparancy & à la carte programminig
Cable content packagers want to bundle a burning bag of crap channels with each channel consumers actually would pay for. Viacom pioneered it with CBS as bait, Disney copied them with their ESPN, Fox uses their popular cable news channels.
Cablers should offering the content packages that are available to them, straight up. Charge what content companies demand, plus a percentage, for each ordered channel, but nothing for unordered packages. Disclose it to consumers who don’t know real reason good channels must come bundled with “Bravo” or “Nickelodeon” or “Comedy Central” trash.
Re: The answer's transparancy & à la carte programminig
and that is the model they plan on implementing for their new internet they are working on. it will be loads of fun!
In the days when removing an option gets called “helping to control what, where, when, and how they get content” while nobody screams “doublethink” from the top of their lungs, I reckon it’s time we dig up Orwell and attach a generator; it would be a shame to just let all that spinning go to waste…
Googles true folly
From what I have read the author nor the respondents really have a full understanding of Google’s folly. They like many before them (competitive wire based infrastructure) assumed the design of a better mouse trap was all that was necessary and the world would move over for them. The primary cost isn’t programming but the cost of building and maintaining millions of miles of facility. From my observations Google didn’t take this into account until they were waste deep into it.
The poles are already crowded and space for an addition contact is difficult and expensive to acquire. Then there is the underground facilities which cost 10 X of aerial not to mention that the utility easements are equally crowded and difficult to navigate. Simply put there is little to no physical space available which has contributed to Google’s cost over runs complicated by a lower take rate than they anticipated. Don’t blame net neutrality blame Google for jumping in to a business they knew very little about. Life isn’t all virtual as envisioned by the people in Silicon Valley. From day one they should have been hiring people with the experience and knowledge of building physical plant.
Re: Googles true folly
You missed Googles biggest extra cost, obstruction by the incumbents.
Re: Re: Googles true folly
I will concede obstruction accounts for the time it takes to acquire an attachment permit. However, Google had been unrealistic in their expectations and submittal process regardless of how they portrayed it. I will say it again, if they had only hired the field expertise they needed on the front-end things may have gone much better.
I had really been hoping they were going to regroup and try again. But appears their leadership has doesn’t see a future in wire based systems and hoping for a wireless solution.
Re: Re: Re: Googles true folly
Google could have hired the smartest people on the planet to do this, but the company still would not have been able to overcome incumbent interference any faster.
Re: Re: Re:2 Googles true folly
Things could have still gone much better. The incumbents weren’t Google’s only problem by a long shot.
what is this added you speak of?
I believe your directing this to my point about “competitive wired based infrastructures” know as overbuilders.
There is a lengthy list of others who have tried the same as Google but none the size or political clout. All of whom with the same build problems as Google. This is just a very short list that I can recall;
Sacramento & Dallas – WIN, who simply walked away from their investment
Chicago, Detroit, Denver and Ohio – WOW, who still exist but they purchased other over builders at bankrupt dollar values. However, they have expanded very little.
Kansas City – Everest, they still exist which would have put Goggle as one of four had they succeeded
Re: Re: Re:
Does demonstrate the power of the incumbents doesn’t it.
Re: Re: Re: Re:
It demonstrates the tremendous cost of construction and the need for expertise.
Look, I’m not disputing your point about the obstructionism. No business will give up a share of their market if it can be prevented. Google is not an infrastructure company and should have hired the right people to run these projects. Instead they created layer up on layer of contracted project management with not much more than computer programming as their expertise.
I’m talking to you from a position of knowledge not speculation. I hope you would take away that there were far more reasons for their failure not just the hand of incumbents and pole attachments in Louisville and Nashville. Its far more fundamental than just that which includes build cost far in excess than they anticipated which has little to do with the incumbents.
Re: Re: Re:2 Re:
Google has plenty of experience on bringing in large scale projects on time, as they build their own server farms. While physically compact, the networking inside those is on a large town scale.
Re: Re: Re:3 Re:
Two different environments and skill sets. There really is no comparison between ISP and OSP. Other than it takes lots of money to do either one.
Re: Re: Re:4 Re:
The major skill set difference being that of bribing, sorry making campaign contributions to local politicians.
Re: Re: Re:5 Re:
Goolgle’s problem was that, like you, they didn’t appreciate the difference either.
Re: Re: Re:5 Re:
I’m not sure why you needed to interpose another path to the discussion. I haven’t heard of any bribery by Goggle although it may explain some of their excessive overhead. I can’t go there with our proof unless you can provide a link to a story somewhere.
Re: Re: Re:6 Re:
I would assume that the AC means that Google is the only one not doing any bribing / campaign contributions at the appropriate local levels. Or writing state telecom law, etc.
Mostly unrelated: I am still amused by the phrase "waste deep" from your original comment. I don’t know if that was intentional or a spelling/autocorrect error, but it shines.
Re: Re: Re:7 Re:
I assumed AC was insinuating that the Incumbents were the only player involved in contributions or attempting to rewrite telecom rules at both state and federal levels. One touch makeready rules and net-neutrality are the buzz both headed up by Google. I was hoping the conversation was going to stay true to the difficulties of building facilities and not go where it did.
Being in the plant construction business for 40 years running projects from South America to Canada I have seen almost everything. And I can say first hand Google botched it. But on the other hand, I was never sure they were truly in it for the long-haul dabbling in a dozen cities simultaneously with by all accounts less than 500,000 subscribers. Lots of fanfare but no meat.
My thoughts all along that it was no more than a ploy to push net-neutrally legislation. They would have been the ultimate winner benefiting from the highspeed connectivity with virtually no cost of OSP infrastructure. Competing for voice/video subscribers with no cost of investment nor maintenance.
Now that they have lost on all accounts they are deep in waste or waste deep.
Re: Re: Re:8 Re:
Stronger advocacy for network neutrality would not have helped Google build more infrastructure or gain access to existing infrastructure.
Re: Re: Re:8 Re:
Regardless of the potential for derailment or whatever there, I see no reason why you can’t offer deeper insight into your estimations of how Google botched it. You may have both the personal experience and knowledge of what Google was doing (I have seen some of the stupid things they and local governments have done already, e.g., San Antonio), but we don’t know what, specifically, those things are unless you elaborate a bit. I, for one, would read a lengthy article on it for sure.
Re: Re: Re:9 Re:
Oops, I mean you and/or Gary. Unless you are Gary, in which case I mean Gary.
Is anyone willing to sacrifice by doing without? Because when there’s no competition it’s the only way to vote with your wallet.
Sure. Everyone can just stop using the internet. Or buying food. Or going to hospital. Or paying for energy or water. And stuff. Until the corporate and government worlds get their act together.
We’ve “done without” pay-tv for a very long time, long before it was a trend.
We could, as well, choose to do without broadband internet, if we felt so inclined. But the bottom line is, contrary to Karl Bode’s rambling rants, internet service remains reasonably priced.
Our real financial challenges lie with health insurance (up 100% in two years, thanks to the “affordable care act”, housing (rising steadily thanks to government zoning and regulation), and personal safety (threatened by government letting all the bad guys out of prison.)
Re: Re: Sacrifice
Watch those premiums go up now that Trump has put the brakes on the subsidies.
Housing regulation problems are often due to HOAs going all NIMBY, not the government.
RE: personal safety… citation?
As for high-priced internet not being your problem, great. Good for you. But others have different experiences.
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