And so the other shoe drops. Google, reports the Wall Street Journal, is looking to add video entertainment services, and possibly voice, for customers of its 1-Gbps fiber to home network in Kansas City, Mo., and Kansas City, Kan. The moves would be logical. Many observers have wondered how such a network, delivering only 1-Gbps Internet access service, at prices “comparable” to existing services provided by telcos and cable companies, could possibly generate enough revenue even to break even.
As it turns out, Google has no magic rabbit to pull out of its hat. The only way to approach break-even apparently is to operate the network the way all other such networks are operated, namely providing triple-play services to consumers.
The other obvious angle is that Google’s role in the market, though currently restricted only to Kansas City and Palo Alto, Calif., now will move from technology supplier and software firm to becoming an actual service provider.
That would not be unusual. Already, it is hard to untangle the parts of Google’s business that are strictly related to indexing information, and those parts of its business that would otherwise be called “media.”
Nobody expects Google to become a “service provider” on a wider scale. But that isn’t the point. To some small extent, Google will become a distributor of voice and video services, not just a broadband access provider. So far, it seems unlikely Google would get licensing rights that will immediately save consumers money.
In fact, any video rights will likely include the normal clauses that require Google to pay as much as other video distributors. But the triple-play push is new.