Visit Your Local PBS Station PBS Home PBS Home Programs A-Z TV Schedules Watch Video Donate Shop PBS Search PBS
I, Cringely - The Survival of the Nerdiest with Robert X. Cringely
Search I,Cringely:

The Pulpit
Pulpit Comments
Status: [CLOSED]

Where does this leave iTunes? Will iTunes become the front end of this service?

Roger | Jan 19, 2007 | 3:15PM

Will Google end up being the Berkshire Hathaway of technology?

Jeff | Jan 19, 2007 | 3:19PM

This is one of the best articles you have written, Mr. Cringely. How does the acquisition of Youtube fit into this plan - will some sort of peer to peer sharing mechanism be tied into Youtube. Youtube currently only streams video - Is that temporary?

Vinay | Jan 19, 2007 | 3:23PM

What a rosy scenario for Google!

At $500 per share, though, it certainly seems overvalued.

When will click fraud make a dent in their plans (and revenues), or is that just a minor issue in your opinion?

Not A. Pundit | Jan 19, 2007 | 3:29PM

Quite a good article. This scenario reminds me a LOT of the "robber baron" monopolists of the late 19th/early 20th century.

And after vertical consolidation (owning the bandwidth) comes horizontal consolidation. I wonder if 10 years from now Google might be buying movie studios and television networks.

Barney Greinke | Jan 19, 2007 | 3:37PM

Meh.



Never underestimate the power of competition/innovation/ or purely human desire for diversity.


The world will never be taken over by engineers.



I recommend movie Alphaville, it kind of reminded me Google.

Piotr | Jan 19, 2007 | 3:40PM

One question:

I can see how building all these data centers can alleviate the problem of bandwidth on the server side by acting as proxy servers.

What I'm missing is how google is going to get ALL these gigabytes of video/data "the last mile" to our houses every day. Seems that's going to be the bottleneck for those of us without fibre out on the telephone pole outside our house.

Barney Greinke | Jan 19, 2007 | 3:46PM

Well, IBM fell, Microsoft will.
So will the Goolag.

subw | Jan 19, 2007 | 4:03PM

Roger writes: "Where does that leave iTunes?"

I was just thinking that this theory would explain a few things about why Erik Schmidt is on Apple's board of directors. If Bob's guess is correct I would excect the iTunes store (chock full of HD video...) to be the first app to pop up in these data centers.

As for the "last mile problem" - couldn't Google neatly solve that by buying Sprint and leveraging their WiMax spectrum? So there could yet be a "GoogleBox" destined for your living room. Athough a USB WiMax WAN adapter for Apple TV - (remember all the questions asking "Why does it have a USB port?") wouldn't be a bad idea either...

David | Jan 19, 2007 | 4:07PM

This is an interesting scenario. Bob, you have called this for quite some time now. I remember when you told us at the HP Manager of the Year in NYC that you had a chance to own Apple stock soon after when Steve Jobs offered you stock instead of a higher salary. It seems like Google would be undervalued if they can leverage themself as the provider of digital content that most people want and need. There will be some privacy issues along the way too.

I remember in 1995 that this scenario was posed at the SuperComputing Conference and it was said that within 10 years everyone would be downloading TV programs over the Internet. That time has passed, but it is coming. It is too obvious. Google has posed itself to be the provider of everything that is precious. Bill Gates is probably cringing at the thought of giving in to the Internet Giant someday. I believe the end of Microsoft will be when a pure operating system will connect users to the Internet on a variety of appliances (something Java was supposed to do.) Google will have to power to make it happen and when they do, watch out.

Michael Leyba | Jan 19, 2007 | 4:13PM

Robert:

You are the smartest commentator online today, but above is only highly specultaive at present.

Broadcast is not about to go completely over the top when there is no advertising revenue (look at online cpm versus tv cpm, is got a long way to go).

Cable Networks are not going completely over the top because they derive about half of their revenues from content sales to the cablecos and satellitecos.

The movie studios could go completely over the top through wal-mart etc but then again they could end up making sweet deals with the cablecos for VOD, who if net neutrality does not pass can kill the entire online content space by raising bitcap fees and internet access prices.

Whats left is niche content from myspace and youtube etc.

Your thesis is still wait and see- lots of hurdles still to pass before Google takes over more than online advertising!

Respectfully,
Brahm Eiley
President
The Convergence Consulting Group
www.convergenceonline.com

Brahm Eiley | Jan 19, 2007 | 4:21PM

Robert:

You are the smartest commentator online today, but above is only highly specultaive at present.

Broadcast is not about to go completely over the top when there is no advertising revenue (look at online cpm versus tv cpm, is got a long way to go).

Cable Networks are not going completely over the top because they derive about half of their revenues from content sales to the cablecos and satellitecos.

The movie studios could go completely over the top through wal-mart etc but then again they could end up making sweet deals with the cablecos for VOD, who if net neutrality does not pass can kill the entire online content space by raising bitcap fees and internet access prices.

Whats left is niche content from myspace and youtube etc.

Your thesis is still wait and see- lots of hurdles still to pass before Google takes over more than online advertising!

Respectfully,
Brahm Eiley
The Convergence Consulting Group

Brahm Eiley | Jan 19, 2007 | 4:22PM

I've long felt Google serves up the internet as we know it, I even touched on it back in October: http://billy-girlardo.com/Google/2006/10/25/is-this-firsthand-experience-of-google-taking-over-the-internet/

Anyway, SC in the house! Born on John's Island, last 15 in Mt. Pleasant, currently in Greenville. Don't laugh at that blog, I'm too busy in school (heading to Raleigh for 6 months) to mess with it right now. Peace.

BillyG | Jan 19, 2007 | 4:27PM

Sometimes when I read your columns, I get this creepy voice in the back of my mind, "You must assimilate".

Of course I was finishing watching "Luck Slevin" off some website call peekvid that my son told me about...so...maybe I have already been assimilated...and I just don't know it yet.

creepy...

Cecil | Jan 19, 2007 | 4:27PM

Sometimes when I read your columns, I get this creepy voice in the back of my mind, "You must assimilate".

Of course I was finishing watching "Lucky Slevin" off some website call peekvid that my son told me about...so...maybe I have already been assimilated...and I just don't know it yet.

creepy...

Cecil | Jan 19, 2007 | 4:28PM

>

Actually, they have had a significant facility in Georgia for a couple of years. It is on the west side of Atlanta in a totally unmarked building. There are a couple of dozen employees, all sworn to secrecy about what's inside the building.

tom | Jan 19, 2007 | 4:34PM

According to Bob, all the bandwidth acquisation is predicated upon watching digital TV being the killer app. This might be so, but I don't see it. You can get broadcast TV off the air for free. And people are watching fewer hours of television and spending more time on line these days. If video bandwith is the key, there must be another killer app besides passive movie or TV watching. Anybody care to speculate?

Dyung | Jan 19, 2007 | 4:45PM

Suddenly, Google's strategy of no advertising during their first 3 years as a company is starting to make sense. By offering a superior service and trustworthy results Google has a built in level of trust with users.

Compate this with MSN, which for years provided low quality paid listings instead of natural search. Microsoft is paying dearly for trying to deceptively monetize MSN, and users have not forgotten just how bad MSN was (remember when they were a feeder for looksmart.com?)


cvos | Jan 19, 2007 | 4:48PM

OR somone begins to market cheap consumer products that do the same thing but on a massively decentralized scale.

Imagning every home with a pnp wireless mesh network node that uses some bittorrent decendent to negotiate bandwith, cpu and storage use.

* FREE internet (no need for ISPs share with your negibour).
* FREE no hassle IP-telephone

And for us geeks:
Anonyomus internet through TOR
Home server for those internet service needs

John Nilssson | Jan 19, 2007 | 4:50PM

I would be more inclined to believe that Yahoo should just abandon search to Google if Google were more than a few years old. Nobody seems to remember that there was a time when Google didn't exist and everybody thought search was a done deal and Altavista or Yahoo would just own it forever. That's why they all went portal and gave up innovating, which is what gave Google the opening it needed to come in. They haven't dominated forever and won't.

Matt Grommes | Jan 19, 2007 | 4:50PM

Does anyone know if Google is doing bandwidth gorging internationally, and if so, where?

Richard | Jan 19, 2007 | 4:59PM

Thought you might like to see this... they are building one in NC as well.

http://www.bizjournals.com/triangle/stories/2007/01/15/daily43.html

dp | Jan 19, 2007 | 4:59PM

Don't count out the telcos. With 4G networks, your local wireless carrier will become your ISP. Look for the carriers to make deals with Hollywood to cache their content.

Then that $500 share price for Google will look mighty rich.

John Roberts | Jan 19, 2007 | 5:02PM

I think the real story here is what Google is doing to prepare for then end of the age of cheap, and more importantly for them, reliable energy.

That they are plugged in and preparing themselves for something most people are either ignorant (the majority) or in total denial of (a dangerous minority), only re-enforces in my mind the intelligence and forsight of those involved. Yeah - Google will be with us for a long, long time.....

If you don't know what I am talking about I'd urge you to educate yourself about what will be happening to world energy production over then next 20 years. It is very sobering.

As a starter, for a technical analysis of the state and future of energy production I'd urge you to look at the work of Canadian Geologist David Hughes...

http://energy.dal.ca/Files/Presentations/Lecture_PPT_03Nov04_Hughes.pdf

Google: Peak Oil, "David Hughes"

Ivo van Selst | Jan 19, 2007 | 5:03PM

Bob says:

"...in order to become dominant they'll have to overcome Google's brand recognition with users, which is almost impossible to do."

Is that true? It wasn't long ago that Alta Vista and Yahoo ruled, and few people had heard of Google. Who's to say that another young upstand can't topple Google?

fatso | Jan 19, 2007 | 5:12PM

I don't know if you're right or wrong about Google's plans for data center, but this is not the first time you assert that a company is working to control the internet. I remember your column about Microsoft and IP/TCP. In that case and this, I feel that in trying to rationalize a company's future plans, your judgment and reasoning are clouded by power/money worship.

You predict the future by projecting out the present. Microsoft is the dominant player in the computer business, so they will be the dominant player 5 years from now, but even more so by (insert prediction here). No one can stop them because they are in the dominant position and their money will crush any competitors. In this column, you basically predict that Google will be our God in the future, just as you predict that Microsoft would be our God 4 years ago. Well, Microsoft is definitely a god, but in just a few short years, they've been marginalized. They are not The God. And so it will be with Google. My prediction is that right now, someone somewhere is working on something that will marginalize Google in the future.

lelandusa | Jan 19, 2007 | 5:17PM

You can't dismiss telcos. As long as they own the 'last mile' or 'first mile' connection facility to end-users (you and I), they will have a BIG 'say' in what/how we consume content. AT&T vs. Google could be an interesting battle....

kaeah | Jan 19, 2007 | 5:21PM

google deserves what they have for not spamming us to death and making us LOVE to use them as our homepage.

Sara Klinghoffer | Jan 19, 2007 | 5:28PM

Information is power; but the ability to control its flow is equally powerful with much more disastrous effects - for us

and Google is working for the stranglehold
http://www.winextra.com/?p=252

Steven Hodson | Jan 19, 2007 | 5:43PM

Too bad Google is run by such bleeding Liberals.

Btw, I hope they put a datacenter near me soon.

David | Jan 19, 2007 | 6:06PM

Goolag? Is that the amount of latency in your last Google query?

David | Jan 19, 2007 | 6:10PM

Oh shit! Don't you realize what's happening! They're building SkyNet!

Robert Yoder | Jan 19, 2007 | 6:19PM


Speaking of skynet...

http://www.youtube.com/watch?v=ti_gmwcP9Pg

As that great sage of our times, Homer Jay Simpson once said,

'The Internet!!?! Is that thing still around?'

Who knows, with Google being Google,

Homer's words may prove to be prescient.

HiMY SYeD | Jan 19, 2007 | 6:33PM

Google is doing stuff that's making Microsoft jealous. MS has always been noted for having been late to the internet game, not sensing the importance of the net, and now there's a company that's come "out of nowhere" to beat them at it even though Google came later than Microsoft. Interesting.

Devon | Jan 19, 2007 | 6:38PM

Well that certainly shows the real reason teleco's want their tiered internet. With Google preparing for the future and customers moving toward that future each day, teleco's are going to try to grip on to what they have for as long as they can. It is their last standing position, on which, hopefully they will trip and fall

bryon | Jan 19, 2007 | 6:41PM

While I agree that Google has set themselves up to be the internet's front door (and already are for most purposes), I don't think that is their plan for these data centers.

More than likely, Google is simply setting themselves up to have the bandwidth to distribute the rich media they are planning to release in the next few years. They may be planning to offer TV service over IP or something similar and they need to be in local markets simply to handle the bandwidth of their own service to the ISPs for distribtion to consumers.

While this may kill satellite and cable it won't kill the ISPs. Yes, the ISPs will require more bandwidth but they'll offer it as a premium option. For argument's sake, the only relevant players in the broadband market will be the cable companies and Google won't be able to kill them.

Think about it, the cable companies own the "last mile." Now if the cable companies stopped broadcasting cable channels, they'd have more bandwidth to play with. Expect them to adjust to Google's TV and video service by replacing cable channes with a fatter pipe. So your current $45/month broadband connection becomes the equivalent of basic internet. The cable companies will charge a premium for access to the fatter pipe, say at the current rate for cable service. So to the consumer it appears their costs haven't increased and the ISPs will make up their loses on additionally bandwidth utilization by changing people more for it.

Google will essentially be stregthening the cable companies monopolies. Unless Google plans to run fiber to the home from these new data centers. :)

Scott | Jan 19, 2007 | 6:56PM

In a previous life, I started an ISP.

It amazed me that the local telcos didn't do more with their ability to provide dedicated circuits. At a time when they were selling alarm circuits for $6/month, it really seemed like they should be marketing to kids for gaming. Sure, it's fun to play against kids on the other side of the world but it's a lot more fun to play against kids that you're going to see at school tomorrow.

Telcos still can provide that local bandwidth because they control a pipe to the house. Not sure how Google will cope with that. Cable? WiMax? Powerline?


I'll be really curious to see how the telcos - now that there's only 3 of them - will do against Google.

James D | Jan 19, 2007 | 7:05PM

That's a pretty sharp analysis there. I personally think they are building all the data centers in preparation for the increase in information ("data") in the coming years, esp after the 3rd world enters the Internet on a grand scale.

Steve | Jan 19, 2007 | 7:20PM

You probably heard that Google just announced that they will be putting a $250M data center in Lenoir, NC. From what you're saying, NC would have gotten the center anyway without dangling those big incentives in front of Google.

Philip | Jan 19, 2007 | 8:03PM

Excellent in depth reporting and insights. I read everything you write and always learn something. Thanks for the link to my blog on Google's Dark Fiber Mystery.

Think ahead 5 years or so. All those videos you rent from NetFlix and Blockbuster...will be delivered over the Internet to DVRs and digital media centers in your home. YouTube might become your provider of pre-recorded TV shows, sports events, and full length movies.

Having big data centers strategically placed all over the country, and lots of fiber bandwidth to tie them together, looks like a pretty smart move right now. It will be brilliant...and very profitable in the future, especially if the telcos kill Net Neutrality.

Robert, you inspired me to write another updated blog on this subject today. See http://dondodge.typepad.com/the_next_big_thing/2007/01/google_youtube_.html

Don Dodge


Don Dodge | Jan 19, 2007 | 8:08PM

Brilliant! I hadn't thought of that at all, but spending a little while contemplating it it makes total sense, and I think there is in fact another big problem - consumers are going to want to stream data so that 3 GB is going to come in a narrow window.

I also think the data centers fit in with my theory that Google are trying to take over Corporate IT too (i.e. 'Google apps for your domain') - the link in my name links to my own follow-up entry.

Thanks - I'll be looking forward to more of your thoughts!

Mike | Jan 19, 2007 | 8:39PM

Yup! Peering is the ONLY future of the internet, where bandwidth needs are following their own version of Moore's Law, because peering can scale up the fastest. So the question becomes: who can scale up a large-scale peering solution the fastest?

Peering is also more responsive to the kind of brainpower culture Google brings to the game than traditional bandwidth.

David Larson | Jan 19, 2007 | 9:11PM

Interesting, but what about the last mile? Most of todays bottlenecks are still the local loop to the customer. Sure the ISP will have a big pipe to the content but the customer will still be poking along on a DSL connection.

bkovar | Jan 19, 2007 | 9:36PM

What about the last mile (quote: bkovar)? What does Google care? That's still the ISP's problem. The different ISPs can fight it out; the users can whine; Google gets their business anyway. Regulators won't have much to say about it because Google isn't serving consumers... just providing a service to the telcos and cable operators.

David Brown | Jan 19, 2007 | 9:54PM

Another reason for the co-location with power facilities may be the Broadband over Power Line (BPL) option for delivery over "the last mile". The utilities are frequently capital limited for such large jumps in technology and services. They would be unable to roll out large scale services unless they partner with someone in the internet business. However, they do offer a huge amount of infrastructure and right-aways (think of every transformer operating as WiFi hub), and connect to every household.

By controlling a large amount of dark fiber, Google can move the traffic across large distances. By partnering with power companies, they by-pass the telcos to offer direct home service of video, internet, and phone. Cool plan.

I am not personally worried about the Borg. While Google may not be able to flash their "Do No Evil" motto with pride anymore, competition has a way of reducing hubris to rubble.

Paul Bissett | Jan 19, 2007 | 9:59PM

Right. If Google leasing cheap bandwidth, it does not mean they will control the whole market. Just as if someone leases plenty of cheap apartment it does not mean they will control all real estate in the city. Leases have a tendency of running out and be renewed, which means backbone providers have an option to say "no, thanks" next time. Last mile is not owned by Google, and if telecoms decide to "fight the threat" no matter which local Google warehouse you try to connect, it will be slow. And, on top of all, Google may be doing it for themselves, to support redundancy, parallel computation networks (which will be rented to anyone who wants to pay, just like Amazon rents their storage systems) and delivery of _their_ content, not somebody's else.

Max Smolev | Jan 19, 2007 | 9:59PM

Great article this week. I agree with the video issues you discuss, but also with Steve's comments on an information explosion from the developing world, especially if the XO project works out.

A lot of people are commenting on peering; I am sure you have already read about Project Venice, now called Joost. It is the latest from Janus Friis and Niklas Zennström and is really going to shake things up if it reaches critical mass. There is plenty of room for symbiosis here, and the outcome will be interesting to say the least

@Brahm Eiley
The Joost coverage (URL below) at Wired addresses the revenue issue quite well, but exactly how Google will work it is unclear, naturally enough.

http://www.wired.com/news/wiredmag/0,72506-0.html?tw=wn_index_1

dblanchard | Jan 19, 2007 | 10:22PM


I'd rather have Google as my monopoly content provider than Comcast. Until I see Google trying to make money off of subscriber fees, I'm not worried, their model is closer to broadcast TV.

Also, I've always felt tech monopolies, say Microsoft, were easier to subvert than older monopolies simply because in the Information Age, knowledge is power, rather than than the "money is power" of the railroad years.

I for one, welcome our new overloads. But if they get too big for their britches, they are only a next-google away from becoming marginal.

PhantomOfLiberty | Jan 19, 2007 | 10:29PM


I'd rather have Google as my monopoly content provider than Comcast. Until I see Google trying to make money off of subscriber fees, I'm not worried, their model is closer to broadcast TV.



Also, I've always felt tech monopolies, say Microsoft, were easier to subvert than older monopolies simply because in the Information Age, knowledge is power, rather than than the "money is power" of the railroad years. Microsoft may continue to be profitable, but their market share is slipping, and plenty of altenatives exist.


I for one, welcome our new overloads. But if they get too big for their britches, they are only a next-google away from becoming marginal.

PhantomOfLiberty | Jan 19, 2007 | 10:33PM

For those asking about the last mile, Google does not need the last mile and probably wouldn't want it due to regulatory concerns.

Bob's argument is that the local ISPs will enter into peering agreements with local Google branches. The way the Internet works is that someone owns the physical lines the data flows over. If they need to get data that's accessible through someone ELSE's network, they (usually) have to pay for the privilege. A Google peering agreement would allow the local ISP to retrieve content off of Google's servers without paying for the bandwidth. In exchange, Google wouldn't have to pay the ISP to send bytes to it's users. This saves money for both parties.

This is basically how Content Delivery Networks like Akamai currently work. Having datacenters all over the place would make Google the biggest CDN ever. The only part that doesn't add up is that you can put well over 40 users on a CDN server, so where do the extra resources come to play?

footac | Jan 19, 2007 | 11:03PM

Great article, wonderful insights on everything google related going on right now.



However, is google somehow getting out of a local loop fee? How can a proxy server exist with no wires going to where the subscribers are?



Is google going to ignore the parts of the United States where no fiber exists, or is 50 miles away?


Google isn't recognizing one simple fact: local people like local business, even if local business is more expensive. In a lot of areas, those big guys give up easily 20-30% of their customers due to shoddy support, bad contracts, or just corporate images.


Google won't always be the clean boy image they once were, and I'd suggest AOL as an example. Hiring up all the smartest people won't assure they can't work for the enemy: I'd believe it breeds even more smart people that would never work for you.

phreaki | Jan 19, 2007 | 11:05PM

Google is an aggressive company though many of your details aren't clearly explained.

The current battle between BluRay and HD-DVD doesn't matter in regards to consumers, DVDs work just fine. The DVD-rips of these high end videos will increase bandwidth however though I don't think it will spike anything soon (perhaps by around 2010).

It's clear that bandwidth will only become a greater demands as time passes though. So in a general and vague manner I can agree with the theory.

John A. Bilicki III | Jan 19, 2007 | 11:10PM

The RBOCs are not going to surrender that last mile without a fight. Fiber facilities are commonly leased, most telecom networks are built that way. footac's right, what they're building is more of an Akamai-done-better. It won't be very visible to end users.

Rick Rodman | Jan 19, 2007 | 11:17PM

Its ovious from the fact that google is no longer restricted by any law, prevailing arround. Googles anchor will be arround each and every character,string exists in the internet. Amalgumation of many components including web,media, live publication will be the priority in all its further development. ?No wonder its the adsense(googles pressence in bussiness thru out the globe), is gaining popularity.

There is allways more to explore and more to Learn.

Jai Jagatnath

saumendra swain | Jan 19, 2007 | 11:24PM

If this hypothesis is correct, I think the dark horse spoiler for Google will be Akamai. What Bob claims that Google is up to essentially amounts to a more potent version of internet content cacheing, an arena in which Akamai is the 800 pound gorilla.

dave | Jan 19, 2007 | 11:30PM

Great article. I particularly like Paul Bissett's comments regarding the BPL angle and wonder how not only data but also electricity could be better managed as electric cars and smart-homes become more commonplace.

Just one question Bob. Are you waiting for Google's internet video empire to come to fruition before you release season 2 of Nerd TV? I personally am more of a talk-radio/podcast kind of guy so just releasing the season 2 mp3s would be fine by me.

drewby | Jan 19, 2007 | 11:36PM


i work in the networking/telecom industry, and find
your article funny and utterly clueless.

There is more to building and running a network
than leasing fiber.. Pundits and fanboys love
to extrapolate and exagerate...

The business of building and operating networks is dull and boring - and i can bet that the brains
at google have better problems to tackle than
moving bits from place A to B.

routers-r-us | Jan 19, 2007 | 11:48PM

Sounds plausible for the backbone but the cable and telcos own the last mile, the most expensive part.

RoyB | Jan 20, 2007 | 12:06AM

Far better Google and PayPal than Microsoft!

Don Groves | Jan 20, 2007 | 12:15AM

People like router-r-us (above) have thier heads in the sand and are going to be the first to be swallowed by the MegaGoogle.
Good luck to us all!

Fred | Jan 20, 2007 | 12:20AM

Nice article.

I think google intends to become an ISP.

Here's why.

http://www.eweek.com/article2/0,1895,1980605,00.asp

I think that it it will use wifi, or wimax, or some dirivative or future technology to bridge that last mile into the house.

Google on cell towers perhaps?

Google owns a ton of slash 20 addressess.

" According to Lightman, some service providers are preparing for IPv6. He ran down a list of companies with "slash 20" addresses.

"You know who else has a big pot of slash 20? Google," Lightman said. "Yahoo does too. It's not that service providers aren't doing it—it's the savvy service providers, with the high multiples and visionary management, that are getting ready to go into it.

"This is why Google bought mobile dark fiber. It's to go out and go: 'All these bozos in America aren't rolling out IPv6, so we'll do it if they aren't going to,'" he said. "

In order to get those addresses it had to certify it was going to use them. It can't use them all by itself.


More Hints:

"# Google Wi-Fi. Google is moving forward with municipal Wi-Fi networking plans for Mountain View, Calif., near its headquarters as well as San Francisco, being built by Internet provider EarthLink, and possibly one in New Orleans. The dark fiber backbone could give the company leverage for expansion to other cities and states, even allowing the company to take over as a provider."

My guess is they're building the data centers for the immediate future to start offering grid computing services, but that they can easily expand to support ISP duties quickly when they've worked out the last mile issue.

Digital Ones | Jan 20, 2007 | 12:22AM

Excellent. I've always enjoyed your insights. Perhaps the last mile problem is the reason that Google is interested in Municipal WI-FI installations and has invested in Current Communications Group's broadband over powerlines. The powerline technology could potentially be behind their choices to build near power plants as well (I'm not sure if that would provide a significant advantage, just a passing thought)

Thank you Bob.

Jay DeLeon | Jan 20, 2007 | 12:25AM

The Government also has its ways of dealing with such things, just as they did with Microsoft when Bill Gates became a bit too cocky for his own good..... ;-)

RenoTerry | Jan 20, 2007 | 1:01AM

When Google Gave us Google, It filled the need of a more relevant Search Engine, which would give the most relevant Information.
No company hs survived for more than 50 years by doing the same thing..

Now google will fill us the need of a better INTERNET

tony | Jan 20, 2007 | 1:04AM

I agree with you that google is preparing for a massive surge in our bandwidth usage. I'd like to add that they will need a lot of bandwidth themselves because youtube will be turned into it's own tv network or searchable video site. how else can you get that much to the end user without fat pipes? I think they are also hedging their bets in case network neutrality doesn't go their way.

great article.

Don | Jan 20, 2007 | 1:16AM

The other reason for being close to a power station is reliability. The shorter the wire to the power station the less chance of something going wrong with that wire.

Lots of data centres close to power stations means a VERY reliable network of servers.

What's the bet that Google has negotiated with these power stations to have their own substation, wired directly into the generators? That way even if the electricity grid collapses Google keeps going.

Maybe Google will roll out a wireless mesh network of "laptops per child" so the data keeps flowing no matter what? :-)

John | Jan 20, 2007 | 1:23AM

Allow me to be the first to welcome our Mountain View Overlords!




In the end, nobody cares who is providing the service, so long as the service is being provided fast and cheap. The only thing Google has to do is keep doing what they're doing and they will be able to take over the world without doing evil. Of course, that might depend on your point of view...




Google: "We aren't doing evil?!? The company we buy our bandwidth from is! Go after them!! *point-point-point*"

ionotter | Jan 20, 2007 | 1:38AM

I think blanketing the country with broadband wireless is .

Watch Carlson Wireless...:-).

Michael Penney | Jan 20, 2007 | 1:45AM

Robert, you're missing a key part of the equation. You got everything exactly right, but you could've included another kind of video: Videoconferencing. iChat is pretty bitchin', and it's only a matter of time before some killer FOSS alternative or other corporate competitor enters the space with a reasonable interface, price, and picture/sound quality. At that point, people are quickly going to start hating phone calls when they can actually BE somewhere, virtually. I already have a cheap projector setup in the living room for movies. It's a small step from there to having a virtual window into the wall of a friend's house, a client's house, my work, a conference room, a lecture hall, my kids with their mother in Calgary, or the leading expert in a field, provided he'll waste his time with me.

All of that is going to increase bandwidth a LOT. All we need is a relatively simple video skype with slightly better picture/compression. You think that's not on the way?

And you didn't mention joost, either, which I think is also going to up our bandwidth bills globally AND locally.

rhY

rhY | Jan 20, 2007 | 1:46AM

Dude!

That is a lot of tubes!!!

timmyJL | Jan 20, 2007 | 2:01AM

What about control of international fiber? The assets of the bankrupt Global Crossing,(after they were effectively looted by American management), were sold to non-American corporate interests for less than one-tenth of the cost of their creation. Isn't the next logical step for Google to move to gain effective control of fiber capacity worldwide?

Richard Sher5man | Jan 20, 2007 | 2:01AM

Cringely, your observations are probably correct, but your conclusions ... I'm not so sure about that. There is a good reason why Google will want to hedge their bets they made with the acquisition of YouTube. However your conclusion that now they have a leverage against the companies from which they buy the bandwidth seems a bit far-fetched.

The "game is over" because those ISPs have no obligation to deliver a minimum of bandwidth to the poor DSL customer. The connections will simply become slower and slower, because already there isn't much choice to switch providers in a particular geography (maybe 2 or three in each local market). I don't see an ISP arms race unfolding to deliver the most actual bandwidth to the individual subscriber. The same applies to the data producers.

Then, to not be the one who dies first in the draught that is about to come Google is storing away barrels of water. Just that, nothing more, nothing less.

Joerg | Jan 20, 2007 | 2:04AM

Why build a few huge sites when Google could use Sun BlackBoxes and locate them in any convenient corner of a secure building?


On the other hand, a container park where all the containers were BlackBoxes would be unbelievably cool.

Geoff Lane | Jan 20, 2007 | 2:12AM

Forget iChat rhY. Think X3D and a distributed form of Second Life. You won't just chat to the person, to all intents and purposes you will be in the room with them.

John | Jan 20, 2007 | 2:14AM

Why would Google even bother having massive server counts in local regions? They really only need a front end 'Beachhead' set of servers capable of caching their local searches, and one high-speed link to 'server central.'. It's not the bandwidth that is the issue. It's the replication and collocation. If Google has the optical transmitters and recievers, why would anyone want to locate their servers anywhere else?

Why control the Internet, when you can rebuild it however you want it?

SeaGROL | Jan 20, 2007 | 2:35AM

I was intrigued by Eric Schmidt's comment at the keynote intro of Applie's iPhone. He said, "Wimax is coming."

As you pointed out in an earlier column, Sprint-Nextel controls 95% of auctioned wimax spectrum in the U.S., and you think Sprint's prospects are good, but Apple's iPhone requires Cingular service, not Sprint, so why would the CEO of Google even mention wimax?


The iPhone can make wifi calls. When wifi transitions to wimax, iPhones will no doubt make wimax calls, using the public spectrum now occupied by wifi. What will happen to Sprint? Their billions paid for wimax spectrum will be worth... what?


It's very very intriguing what a super-intelligent money-laden board of directors could accomplish, being intent on doing no evil and driven by an urge to provide worthwhile services. I personally think it will be over soon for the price-gouging telecoms and cable companies. Their greed will be their undoing.


Thanks for the info on Google's fiber activities! It's fun to imagine the best possible future.

darth cider | Jan 20, 2007 | 3:09AM

I sometimes wonder why you don't just "take the net back". There are ways to build networks without the help of corporations. Just think of the Freifunk project.

They have a vast network covering berlin.
http://www.olsrexperiment.de/

You can find a map of the network here:
http://www.olsrexperiment.de/index.php?option=com_wrapper&Itemid=94&lang=

It works by using network cards in Ad-Hoc mode and the OLSR routing protocoll. They do this by specially modified routers, but you can also use normal computers.

Christian Berger | Jan 20, 2007 | 3:23AM

What makes you think "the last mile" will remain an issue?

Google's free wi-fi-ing San Francisco ... out of the goodness of their hearts?

What makes you think people are going to sit in one place and watch "TV"? Heard of the iPhone? Any idea what it portends?

The future is all about moveable users and moveable (small) devices. That big screen will be only one way ...

zo | Jan 20, 2007 | 3:41AM
Right on Google! Although they are not perfect, the founders of Google have the best intentions in mind. If it was Microsoft doing this, I would want the U.S. Congress on their backs with swords raised. But I predict Google will usher in a new era where technology companies will be more concerned with end-user comfort and accessibility than profitability (let Google's ad business---and other coming goodies take care of that dimension).

We are witnessing the birth of a new paradigm where countless innovations will come and change the way we traditionally do business, treat our employees, etc. And this will be possible because of the miracle and backdrop that is and will continue to be Google.
Yummy GUI | Jan 20, 2007 | 4:06AM

I believe that the author's speculation that all those two data centers are for only that South Carolina is not based on any reasoning. Companies like Google, Yahoo! and others require big data centers to store and process support the huge volumes of information. I donot think that time is ripe for having one server per 40 users.

Nilay Vaish | Jan 20, 2007 | 4:15AM

I miss the fussy old toad picture -- the column has the same style and quality of writing, but somehow it's not Cringely without the toad.

Joomla Degauss | Jan 20, 2007 | 4:20AM

I think your missing the point, its not building two data centers in South Carolina and one in Georgia. Its about building 3 data centers for the region, and getting away from the power problems in CA.

Yahoo is an ISP in Japan with its own hardware, perhaps google want to do the same for the US.

fabricator | Jan 20, 2007 | 4:39AM

Think about what else is supposed to happen fairly shortly...Vinge's Singularity...

This accelerates it. Good or bad? History will be the judge...

me | Jan 20, 2007 | 4:50AM


I think you have this wrong.

There seems to be a rather glaring gap here: How does a google datacenter improve the aggregate bandwidth available to the subscribers? The telco's cost must be in delivering the last mile, not between pops/offices.

It's the internet backbone that is the constraint here.

If the internet starts to crawl because of video load, then google's interactive content will suffer tremendously. gmail, google apps, maps etc. etc. Statistics show that once page load-time/latency goes above a certain threshold, users abandon the service. Google wants lots of local datacenters in order to ensure that the latency in it's services is acceptable to the users. All the long-haul fiber is to ensure they can sync the datacenters, and they will partner with local telcos in order to ensure that their datacenters are on a high-bandwidth loop that is "close" to the customers. This will be good for the telcos, not bad. Google may offer to partner with them to deliver and host their subscriber video services as well.

The more things change, the more they stay insane.

Johan | Jan 20, 2007 | 4:59AM

There is one thing common to all current and future technologies - the need for cost effective
wholesale distribution of media ( shows, data, voice - whatever ).

Google will be the best friend of both the content industry and the owners of the last mile or even you and I - the owners of the network appliance, being IP TV or a cell phone.

The way I see it, it's as if FedEx will ship goods just for the cost of the fuel, as long as they could sell targeted advertising space on their trucks, based on the details of the recipient and
goods delivered.

There is a catch though - Telco companies are not allowed to sell the data ( yet :)!
Don't worry ! try to analyze your use of Google and you'd wish the Telco company sell its data instead of Google using what they know about you.
UNLESS you use scroogle.com or Tor - but that's another story.

ML | Jan 20, 2007 | 5:05AM

Very interesting. But I don't think, that is true.
But time will show.
Anyway we need to buy shares of google.

Victor | Jan 20, 2007 | 6:52AM

Just announced new Google data center in rural NC -- between Asheville and Winston-Salem -- in Lenoir (NOT Lenoir County).

HEADLINE: "Lenoir gets Google, at a cost -- The search engine company is to build a $600 million server farm, and it could receive $100 million in incentives"

From: http://www.newsobserver.com/102/story/534390.html

scott | Jan 20, 2007 | 7:35AM

If you can control the data up to the last mile -- by controlling most of the dark fiber placed in the ground by Level 3 and Global Crossing -- you can prioritize the packets where ISPs will have to sign up to boost their service for the last mile.
If the ISP is not with Google, load time/latency will be a problem, but the next time you call for content Google will provide a contextual solution by clicking on its ISP partner in the area that will provide better service.
If the "Dick in a Box" video or iTunes movie resides in a trailer park outside of Charleston and not on YouTube servers in Bangalore your download issues are not an issue.

mike | Jan 20, 2007 | 7:43AM

This is an interesting article because it not only deals with Google but all the major ideas going back to the 500 channel superhighway and all that. Remember this was Al Gore's big issue before he got into global warming. Time Warner tried something like this called Qube 30 years ago and abandoned it. Qube not only failed but it eventually sucked in not only Warner, but Time and Turner and AOL. Remember AOL? Time Warner AOL still has massive amounts of debts because of this. What Bob describes is Qube on a much larger scale.

There's a lot of confusion about how the internet basically works in the various comments. Many people don't know that when you download something it often comes from something like a data center closer to you, rather than the actual source. Of course, this is complicated so if you start talking about that then you probably need to say more, so it's easier to skip over and assume people already know. It's simple enough to store web pages with graphics in data centers but high definition movies is another thing. You're not talking about 500 movies but 5 million.

Just looking at some basic issues you run into problems. First, how do you charge users enough to justify all of this. Bob mentioned one server for each four people. Google might as well merge with Time Warner. Eventually it becomes cheap enough but we're not there yet. Warner thought we were close 30 years ago, and we are certainly closer but it could still be ten years. Any type of hardware will be outdated shortly. This means anything Google does now is a waste of money. This explains why they focus on electricity since that's the least likely to change, but again you have to ask yourself is it worth it? Is distributing content so important that you want to corner the electricity market?

I was in the Dells last year and it's not such a massive undertaking as Bob describes. Rather than some ego trip it could be seen as simply an efficient calculation and a test center. Like Qube the final system will be something scaled back relying on various partners. Not only are there chances for new companies to come in but old timers like Time Warner are not out of the game. Likely they will merge again soon and if it's with someone like AT&T or Microsoft then they will still be bigger than Google.

frankp | Jan 20, 2007 | 8:20AM


Bob,

Careful about this prediction:




"...which places today's $500 Google share price about eight times too low."




Ironically, Bob, I think you'll see Sun Microsystems, the company you love to predict will continually fail, will see a 3-bagger in their stock price long before Google sees a 3-bagger in theirs.




In late 2008, you'll probably have to look back over the past 3 years since then and wonder why you were so hard on Sun as they were just getting out of their R&D phase to create some solid, high-demand product lines. They are ahead of the game over AMD and Intel in multi-core technology and you've just hinted at the "hmm, maybe I'm a little wrong about them after all" in a couple of your comments these past few months.




I'm by no means a Sun zealot. It's just that I remembered when you gave Apple its death notice for 2 years running and then looked what happened. These big companies are so dynamic. One minute, you'd think it's all over for them and the next, they take another course that is completely unforeseen at that time. They're all moving targets and, unfortunately, it's all too easy to cast opinions about them by what they've done and what one thinks they're currently trying to do. It's the "what they're really doing" part that is the doh! factor.

SteveH | Jan 20, 2007 | 9:04AM

For those that have followed the history of the internet, you may know who Vint Cerf is. He is essentially the 'godfather' of the internet as we know it, google for 'internet history cerf'. He has been working for Google for some time now. I expect, much like the internet itself has done over the years, it will reshape the way we use data entirely.

Convergence has been happening since 1992, incrementally. Video is simply the last media, due to lack of bandwidth. There are facilities all over that exist solely to provide peering, allowing for more efficient data transfer. There are people who specialize in how to optimize who you peer with to save money and increase performance (Bill Norton).

All of this is good for the end user. Think more about a parallel to the open source movement, make money on the the way things are used rather than for a product. Anyone who says they haven't learned something via google searches is either not online or a liar. It keeps me, a very curious person, constantly informed about anything I could possibly want to know. Will google get the work closer to Utopia? Who knows.

p4ck37p1mp | Jan 20, 2007 | 9:04AM

Credible sources tell me that Google is a CIA startup company, with 40% of their stock being US government owned. "The best way to snoop on what people are looking for on the net, is to setup and provide the best means to do it."

Macro Vaughan | Jan 20, 2007 | 9:17AM

Looks a lot like the @Home business model. Their idea was to push content to regional data centers and cache data locally (in the cable headend). Too bad the hardware wasn't ready, and their content wasn't interesting.

Eric | Jan 20, 2007 | 9:38AM

The way Music industry worked changed dramatically after the introduction of MP3 followed by iTunes by Apple.


GUI on PC's was an innovation which Xerox labs did not know how to commercialize, Excel was a Killer application for the PC's. The sales of PC's took off with this application. You can forgive IBM for granting license to Bill Gates for MS-DOS. As most big companies are very poor in identifying and rewarding innovations.


None of the companies that manufactured Vacuum tube radios (GE wasted 2 years and did not produce a usable transistor radio) could profit from transistors, Sony used the latest innovation and came up with transistor radio and gained market share.


Few other innovations were iPod, iPhone by Apple Inc. The dot com bubble inspired telecom companies lay thousand of miles of optical fiber which made working in Bangalore same as Silicon valley.


This abundance of connectivity lead to growth of VOIP companies like Skype. Now Skype uses the Internet back bone , i.e. TCP/IP or UDP. Unlike conventional international call where a dedicated connection has to be maintained between the two callers. This connection less voice call over the Internet was a disruption to traditional Telecom companies and has challenged the monopoly of long distance carries.


Bit torrent was a disruptive innovation in terms of the quantity of content(several orders of magnitude more than is possible using client/Webserver technology) that could be shared over the current Internet backbone. You can check up Wikipedia for more about Bit Torrent.


Now the creators of Skype and Bit-torrent have come with an innovation that will change the way we watch TV forever.


Full Article at Wired:
http://www.wired.com/news/wiredmag/0,72506-0.html?tw=wn_index_1

Similar current services to watch Movies on the PC: http://www.worldtvp c.com/movies/

Cheers,
Praveen Singh.

Praveen Singh | Jan 20, 2007 | 9:41AM

Macro Vaughn -- You're right of course, but it's the NSA not the CIA.

Jim | Jan 20, 2007 | 9:46AM

The one thing that people seem to be overlooking with the Google as ISP/last mile is that maybe they are smart enough to know that they don't want to be an ISP. The general public is used to Google being a search engine. Most people don't have gmail accounts, still use Mapquest and look at video passed around as email attachements (not counting the 18-24Yr olds). There is a lot of support structure over and above a pipe (optical or otherwise) to your house to be an ISP that is a major drain on profits. Google is setting these data centers up to make it easy for ISPs to peer to them, and to keep traffic off the ISP's network. After all, who would you rather deal with... a company who's servers are in Redmond, WA and you have to go to them, or a company who is one hop away from your node, and is happy to make sure they are up 99.999% of the time.

Yes, look for expansion of Google Video, but also look for Google hosting, Google domains, and Google marketing.

Eric | Jan 20, 2007 | 9:59AM

Praveen,

I think what you linked to is the ultimate aim of Google.


"Broadcast is not about to go completely over the top when there is no advertising revenue (look at online cpm versus tv cpm, is got a long way to go)."

What if Google offers a video on demand system through a Gooble [sic] Infotainment box located in your living room attached to your tv, or a software download. That box/software could easily offer access to software tv channels for all free and cable channels. It could literally simultaneously be an affiliate for every channel, and in the process capture much of the local, and national ad spots. Moderately priced, or free, with the ability to watch Grey's Anatomy anytime during the week, or heck even the entire season would practically ensure the masses will quickly adopt it. Google could easily toss in internet access as a bonus package, or a pay package, or charge for the entire thing. If they're offering cable may as well go for voice, and if they're going for voice and they're using wireless, may as well offer cell service as well.

It could very easily overtake Nielson ratings because instead of a few households dictating the viewing habits of the nation every downloading household becomes a Gooble [sic] Houshold.

As an advertiser why would you advertise with the current local ABC when Gooble [sic] can give you detailed demographic targeting of your advertising, something the current system is frankly horrible at.

Can they do it? I think so. Not only could they, they could do it with fewer commercials, better picture quality than standard cable, and more profit.

Digital Ones | Jan 20, 2007 | 9:59AM

"Yes, look for expansion of Google Video, but also look for Google hosting, Google domains, and Google marketing."

Agreed.

For the immediate future those data centers signals Google's desire, in a big way, to be a Grid Computing Services Company.

Digital Ones | Jan 20, 2007 | 10:05AM

It will be interesting to see how the introduction of consumer RT-V GPUs affect Google's strategies.

John | Jan 20, 2007 | 10:39AM

You say that one server in such a case, would serve 40 users.


I estimate that Google's cost of provisioning and running such a server to be about $30 per month, including buying the machine.


Add in a little more for profit and bandwidth and you are talking $1 per user per month.

A cost structure that would be the envy of Comcast or Verizon for providing their triple play services (VOIP, TV, Internet).

patrick giagnocavo | Jan 20, 2007 | 10:46AM

Google taking over the world. This sounds like a James Coburn Move "The President's Analyst" with Google taking over the roll of Ma Bell. The courts broke up the bell strangle hold on America's telephone back then, I wouldnt trust the Bush packed courts to do the same today.

Scott | Jan 20, 2007 | 11:06AM

For the past few years, we have watched Google and wiondered about Microsoft's response. As well, we have been watching the ISP's, who have been playing a shell game with bandwidth. The telco's have been trying to figure out how tyhey could preserve their monthly income at a consistent dollar level, and in the pricess, have been chokiing down service so that "high speed" users get essentially very low speed service. meanwhile, with the introduction of HD entertainment, the media moguls see this as an opportunity to restrict copying (or "piracy" as they label any fair use) and have got microsoft to play along. We are at an interesting crossroads. With the release of Vista, Microsoft is going to seriously stumble in DRM, leaving the door open for much greater Linux and Mac penetration of the HD entertainment market. At the same time, HD bittorrent files are going to be one of the few ways to get HD content, and organizations like the BBC are going to be putting their content out there on Bittorrent without DRM.

Meanhwhile, the ISP's (Comcast and the telcos) have their sights set on their traditional subscriber base and their traditional delivery systems and revenue models, and still have not realized that an 8 Kbit voice connection should cost virtually nothing, and that last mile considerations are rapidly disappearing. The next piece to come into play will be the auctioning of the NTSC bandwidth, due to take place in 2009, which will move wireless communication up to a whole new level. Watch for Google in the auctions.

Richard | Jan 20, 2007 | 11:17AM

(cross-posted from Slashdot)

Google consumes between 50-60% of the bandwidth every month on our Absolute Michigan [absolutemichigan.com] site*.

Their spider visits hundreds of times each day despite the fact that our site is only updated a day**. Interesting (at least to me) is how poorly our massive "All Michigan, All the Time" site does on the general search for "Michigan" on Google. Way, way after a totally defunct Michigan alternative news site. I assume that most database generated sites experience the same thing.

*Google is also the largest referrer, so it's not as if they are all bad!

**Yes, I am aware of the "changefreq" variable in Robots.txt and Google sitemaps. Most people certainly are not and even aware of these options, let alone using them.

farlane (Andy McFarlane) | Jan 20, 2007 | 11:45AM

WE have lost radio, msm, TV, now WE are fighting for OUR last bastion of "OUR DEMOCRATIC RIGHT TO FREEDOM OF SPEECH"!
Sign all of the petitions you can find and use Googal send them to the Dems and let them know in no uncertain terms that YOU are a Voter along with millions of others!
Cancell all dealings with these greedy vermin to start
Nationalize all Corporations, and put an end of their relentless onslot on OUR DEMOCRACY

wayne | Jan 20, 2007 | 12:14PM

I think you are on the right track, however, I think Google is about to become a telecommunications company.
I think they are going to push GoogleTalk onto mobile devices as a J2ME application and then people will be able to make free calls if they have a mobile device with WiFi, or 3G.
They have also, in addition to buying bandwidth, been having legal wranglings about becoming a TelCo.
I don't think there are purely altruistic motives, but they might be getting ready to release free "phone calls" all over the world. So buckle up for GoogleCom!

Liam | Jan 20, 2007 | 12:24PM

Check out this URL: Local Heroes: Could the Key to Successful Internet Television Be...PBS?
http://www.pbs.org/cringely/pulpit/2006/pulpit_20060608_000354.html
that Cringely posted back on June 8 2006.



To me it sounds a lot like what this article on Google is about. Only Google's business intends to be considerably larger. Plus they need to build these sites whereas the PBS stations arleady exist.



Also look at where they are building these datacenters, near power generating facilities. I dont know, but from what I have read they are locating these facilities in locations that use non-fossile fuels for power generation, hydro and nuclear. The cost of power generation should inherently remain the same with these facilities whereas fossil fuel based facilities costs will go up for obvious reasons.



To up the ante, Cringely suggests 40 users supported per server versus that of 100 for the pbs idea. I would suggest that where google doesnt build a data center then they will locate their shipping container data center on the telco's property. See A Tradition of Empty Boxes: Sun announces the Google shipping container data center, but will it fly? http://www.pbs.org/cringely/pulpit/2006/pulpit_20061020_001035.html
By doing this they still effectively accomplish the pbs local content distribution model. Here they take advantage of the telco facilities of maintaining 100% uptime by sharing the telco opwer infrastructure. With their large data centers and providing peering with local ISPs they accomplish it as well.

Per the San Francisco wifi experiment, google needs a test bed to figure out how to analyze and use it to leverage their business. With each of these data centers and potentially the shipping data centers google would in theory being able to leverage their data centers and local ISPs and local telcos to provide broadcast wi-anything as the future improves. This can be broadcast tv to IPTV to wi-anything enabled devices. They dont need to provide the phones, let the market do it. They dont need to provide the hardware, let the market do it. They just need to provide the network.



Also remember Cringely's article on how McDonalds or the US Post Office could provide such wi-anything networks and effectively cover 95% or more of the US. Or the article about how car manufacturers could provide mesh networking from the millions of cars that they sell. What is to stop Google from partnering with any of the above to move to that next step which would effectively provide the last mile not to mention the broadband over power lines. Power companies across the US are laying fiber to each and every home over time in order to better monitor their power networks so that they no longer have to send folks out to read the meters because people and transporation is expensive. Additionally they would be able to pin point a power outage quickly. This is a lot of fiber and thus a lot of bandwidth that google could be associating themselves with by locating their huge data centers by enormous power generators.



Google doesnt generate the content nor do they want to. They want to enable the content distribution and access and sell advertising and provide all of the services.

Why do you think that they ask so many questions when you goto sign up for google domains, they ask about what additional needs that you need that you dont already have or that google doesnt already offer? Ultimately they want to suck up all of the data and essentially make it available for free.



Good or bad. I dont know. Only history will be able to judge.

Richard Burk | Jan 20, 2007 | 12:29PM

Interesting theory. So now google makes the local TV stations obsolete and their wireless bandwidth (their only asset of real value) grossly underutilized. Looks like they become the big losers in this. I have a feeling this won't happen without a fight, though. Should be interesting to watch.

lastresort | Jan 20, 2007 | 12:33PM

Well, if this happens, the gov't will just divvy it up like the did with Ma Bell. At least in the mean time, all those profits will probably mean innovation like crazy for the next ten years or so.

googleroogler | Jan 20, 2007 | 12:51PM

So, google is installing a lot of geographically independent datacenters, it needs good electricity and it needs good connectivity. And is installing more computing power that it could need...

Maybe google's A.I. is now in control of the company, let's hope it will do no evil.

Cacho | Jan 20, 2007 | 12:59PM

The missing part of the discussion, of course, is why Google is pushing net neutrality so hard.

Seems to me that their local data center strategy only makes sense as the backbone becomes more congested. If they can make net neutrality the law, the network providers won't be able to manage their network, traffic shape, provide QoS, etc.

This week, Bob Kahn (the other "father" of the Internet, and unlike Cerf, not on anyone's payroll) issued a strong warning about net neutrality:

http://www.theregister.co.uk/2007/01/18/kahn_net_neutrality_warning/

"Robert Kahn, the most senior figure in the development of the internet, has delivered a strong warning against "Net Neutrality" legislation.

Speaking to an audience at the Computer History Museum in Mountain View, California at an event held in his honour, Kahn warned against legislation that inhibited experimentation and innovation where it was needed.

Kahn rejected the term "Net Neutrality", calling it "a slogan". He cautioned against dogmatic views of network architecture, saying the need for experimentation at the edges shouldn't come at the expense of improvements elsewhere in the network.

(Kahn gently reminded his audience that the internet was really about interconnecting networks, a point often lost today).

"If the goal is to encourage people to build new capabilities, then the party that takes the lead is probably only going to have it on their net to start with and it's not going to be on anyone else's net. You want to incentivize people to innovate, and they're going to innovate on their own nets or a few other nets,"

"I am totally opposed to mandating that nothing interesting can happen inside the net," he said.

So called "Neutrality" legislation posed more of a danger than fragmentation, he concluded.

With the exception of Google's man in Washington DC, Vint Cerf (with whom Kahn developed TCP/IP), most of the senior engineers responsible for developing the packet switched internetworking of today oppose "Neutrality" legislation. Dave Farber, often called the grandfather of the internet, has been the most prominent critic.

Engineers fear rash legislation would inhibit the ability of systems engineers to improve latency and jitter issues needed to move data at speed.

"The internet is still pretty fragile today," said Kahn.

It's simple. Google causes a congestion trainwreck on the backbone and drives everyone to their local data center solution.

finn | Jan 20, 2007 | 1:03PM

Just a warning, this is going to sound very Apple-oriented.

I think there could be more to this Apple-Google deal than we think. For all we know, Apple could know more about Google's plans than even Bob. Hell, Apple could be seeing more in Google's future than even Google, going so far as to knowing where both companies (and probably their competitors) are going for the next 30 years (as could be hinted by their recent 30-year statement). Hell, Eric Schmidt joining the Apple board of directors could've just been Apple's way of getting someone from Apple in Google (in a very indirect way).

Indeed, I think Apple was right when it said the first 30 years were just the beginning. This is going to be a very exciting century.

Brad F. | Jan 20, 2007 | 1:20PM

That's very, very scary. Big Brother's poised to take over the internet and probably the world!

Bug Wump | Jan 20, 2007 | 1:24PM

its funny to see how quickly a company whose motto is "don't be evil" can be demonized.

Looks to me like Google is plotting a crushing strike on the evil telcos. Good job Google!

Kevin | Jan 20, 2007 | 1:38PM

Somebody help me here with this idea that local TV stations would be made obsolete. I suppose if there is no longer a mass audience for network TV (the mainstay of local TV stations) that would be enough. But I don't see how distribution of video over the internet, by Google or anyone else, will change people's perception of production values. One might not admire the finished product in every case but there is no disguising the vast difference in visual and audio quality. People will check out YouTube and other internet video sources for diversion but it is not a replacement for traditional sources.

Assuming the thesis is that network TV is to be distributed over the internet rather than "free" over the air (OTA), I don't understand the advantage. Before the introduction of ATSC (the replacement for NTSC) there was a clear case for an alternative delivery mechanism because no matter how high the production values might be the reception was too marginal. But that has changed. The highest quality signal is now available for free (i.e. advertiser supported) OTA. It is better quality signal than cable, satellite, laserdisc, or DVD (OK, HD-DVD and BluRay are comparable). What is so brilliant about paying for something you can already get for free?

Steve Bryan | Jan 20, 2007 | 1:52PM

It's time to start buying some google stock! If only I had some money...

Just as Apple has done with the letter 'i' (iMac, iBook, iLife), google will do with the letter 'g'. gMail, gWord, gInternet.

Luke | Jan 20, 2007 | 1:55PM

I for one welcome our new Internet overlords.

peg dash fab | Jan 20, 2007 | 2:08PM

It will be interesting to see how Google reacts when Microsoft and Yahoo are making money off of Google's bandwidth and eyeballs. As weak as I think Microsoft's current business model is, I think they're just as strong in the content delivery arena with the XBox 360. They're really the first mover in the content-on-demand market, the first to offer *EASY* access to downloadable entertainment and content. So that will mean that Microsoft will control many of the endpoints while Google controls the bandwidth. I would take this to mean that an agreement will need to be reached at some point between the two companies because I really doubt Google will want to foot the bill for Microsoft's content-on-demand business.

Interesting times ahead...

Jason Kolb | Jan 20, 2007 | 2:13PM

dDog??

ksdfa | Jan 20, 2007 | 2:21PM

Internet video quality will improve as home bandwidth increases.

HD quality video delivered over the internet is not that far away, and, getting it from a server has the advantage of delivery on-demand instead of ATSC which places you at the mercy of the station's schedule.

The FCC adoption of the ATSC broadcast flag virtually guarantees that internet delivery will eventually be the preferred method.

Owen DeLong | Jan 20, 2007 | 2:23PM

This is pretty far off in left field and doesn't have much grounding in the minutia of telecom. It'll be a cold day in hell before AT&T or any of the other ILECS or cable companies hand their traffic over to Google; in a market void of truely dynamic competition, the demand will be curtailed by the supply.

There is a bit of truth in it, though. The cable companies and the telco's are fighting for market domination in what will be a fairly bitter battle in terms of price and feature wars. All of the players involved--AT&T, Verizon, Sprint, and the cable companies--have a vision of an Internet that they are able to monetize more effectively than just as a blanket carrier. This is in part because they are have roots in the cable industry and cell phone industry where premium content is a money-maker for the carrier and has much higher product margins than just the transport business.

This, of course, presents a problem for Google (and, of course, all content providers) which forsee possibly having to pay a toll for access to their customers (as is the rule with most other content-based industries). To hedge their bets against this, I think Google is looking to build a framework where they can become an ISP. They are getting their own fiber so they won't get trapped in a transport market that may become non-content neutral and have additional premiums required for content providers. They are building partnerships and getting used to the last-mile market, using San Francisco as a test-bed. And, if this doesn't become necessary, they are well positioned--as mentioned--to be able to reliably deliver video content, etc...--to anywhere regardless of how congested the Internet gets.

Clint Ricker | Jan 20, 2007 | 2:25PM

You seem to forget akamai guys..

Byez
Iesse

iesse | Jan 20, 2007 | 2:28PM

Hey, I like Google. I hope if it comes to this, they can pull it off while being transparent to the end user.

Yes, I realize that if Yahoo did this I would be up in arms. Google has generally been the internet's "friend" and the "good guy," and I seriously believe that it will have a profound positive effect on them in the future if this happens.

Henry | Jan 20, 2007 | 2:28PM

Hey, what about the internet over power lines?!?

Does that have any relevance here?

...

JTH | Jan 20, 2007 | 2:45PM

gNome
gEdit
gPhone
gStreamer
gTypist
gTranslator

jh | Jan 20, 2007 | 2:46PM

I think it would be a great idea if Google takes over the internet. If they can provide my data to me fast, and cheap without any restriction like one local ISP charges $5 past 5GB upload, and the other one that I am with restricts bandwidth when it detects p2p programs. Google has been good to me so far and I think that they will be better in the future.

Tyler | Jan 20, 2007 | 2:52PM

i guess cramer is correct even at 500. p/s
jim lark

jim lark | Jan 20, 2007 | 3:02PM

good article, i've been preaching this for years. but you're missing the biggest point here btw.

google is going to do all of this for free. they're going to light up the sky with nationwide wimax as well, leveraging this infrastructure they have now. again - for free.

why free? because they're going to put a tiny little targeted ad banner on the top of everything page you visit. and a 10s ad in front of every video (who wouldn't put up with even 60s of ads to download free HD quality movies? and if you think I'm insane, just keep in mind that single click throughs on the internet can go for $7-$15 dollars, easily equal to the cost of the movie downloaded)

jiller | Jan 20, 2007 | 3:09PM

Dude, you're in a browser. No need to double-click. Welcome to the 90s.

jim critic | Jan 20, 2007 | 3:15PM

I can understand why some Internet experts would want to avoid legislation that would inhibit future innovation. But I think that is a red herring.

What the internet needs is a first law - "no provider shall harm a connection, or through inaction allow a connection to come to harm."

I don't think the concept of neutrality is difficult, and it should not mean that optimizing traffic patterns will be equated to preferring one vendor or service over another.

If Google is the sinster plotter you say, why would it be against NN? I guess it depends on that second clause of the first law. If they can deliver through their own network, but throttle other network's interconnections with them, then their service looks better. That would be the second clause - "through inaction" - failing to invest in bigger outside connection tubes.

MD2000 | Jan 20, 2007 | 3:35PM

There are a few people, such as myself, who are willing to go on record claiming that the future does not hold Google's dominance, but it's demise. I have compiled the Top 100 Alternative Search Engines (alternatives to Google)and I'm preparing a talk and an article on the subject next week. These alternative search engines, each one superior to Google in its own niche, are the tea leaves that show that we are living in the end times - the end of Google; if you just know how to read them. If you would like your own copy of the Top 100 Alternative Search Engines, send me your email at: Charles@CharlesKnightSEO.com. Ciao!

Charles Knight | Jan 20, 2007 | 3:50PM

My first comment saying that Google consumes 50% of my site's bandwidth every month. Since that's about 50 gigs, that seems a bit extreme. Especially if you multiply that times every other site they index. It also seems to me that by consuming such massive quantities of bandwidth, there's got to be an overall impact on its overall price and availability.

Sorry I couldn't put that in a funnier fashion - the cute animal sidekick I had hired was hired away by Every Which Way but Loose II: Go Ahead Punk, Make Me a Million.

farlane | Jan 20, 2007 | 4:09PM

Your conclusion becomes sinister when you decide there must be a zebra since you hear hoof-beats.

Maybe not. Might just be a horse. That is, maybe Google needs huge data centers and huge bandwidth to store and feed massive amounts of data. In case you somehow missed it, Google has already stated they want to be the repository for ALL of the worlds data. Why? Because their business is searching data.

S. Pescador | Jan 20, 2007 | 4:27PM

It's been no secret to anyone who's worked in the telecommunications or network operations fields that the bouncy balls have been purchasing bandwidth left and right. I don't think it's part of any secret ploy by them...they just want to be able to provide results in less than three seconds. Hence, their "Data center in a truck;" I honestly think this is just another step done by the bouncy balls to ensure that their marketing company is the first one people think of when they think of searching.

PhoneGuy | Jan 20, 2007 | 4:42PM

I think this is a big extreme. It is possible to build data centres in USA, but if Google wants to expand all over the world so needs to build data centers in Europe, Asie, Africa, needn't?

Tomas Martinek | Jan 20, 2007 | 5:35PM

I have to agree with S. Pescador in that Google is striving to catalog data. Not just some data, but Alexandria Library, Library of Congress type data. They want to be the resource location for knowledge. Look at their services, Google Earth (a globe and atlas that provides massive geological and text data combined), Google Scholar, Google Books, and many other types of data related services. They are not concerned with peoples bandwidth, they are concerned with their bandwidth and storage capacity. I run several servers serving data for several different workstations (mixed network), we use a central data server where most of the data is served. Data is very dense, and requires tetra-bytes of storage space. We use replication on remote locations to ensure security and backup purposes. We are a very small company in comparison to Google, why wouldn't they use the same policies.

I understand concern for large companies that maybe use practices that are less than completely open, we have several examples of that Microsoft, Cisco, the list goes on. However I believe that Google is after profit in the most economical manor possible, and that may be the hardest thing for those who do not run a company to understand. When you run a company, large or small, what you do to maximize profits, and minimize cost sometimes is suspect to even the most well intended non-business owner. I do not condone all the practices of such companies, but I understand where they are coming from.

Walk a mile in their shoes, then you understand from where they are coming.

-James-

James Doud | Jan 20, 2007 | 5:37PM

This is a nice conspiracy theory, Bob, but where are the backup facts?

Where is the analysis of what the telcos are doing to buck up their backbones for video in comparison to just sitting back and ignoring the problem and waiting for Google - which you say they don't even know is doing this - to save them?

Where are the calculations showing the speed and bandwith consumption curve of video over the next X years vs buildout of new bandwidth by the telcos OR Google?

Where are the maps of Google construction sites?

There are no FACTS here - just speculation. You've speculate before about Google - and so far we haven't seen any of the big speculations come true.


Richard Steven Hack | Jan 20, 2007 | 5:53PM

I am more interest in short term and result, I support the big giant company that can offer me one stop shopping but please don't fail because there will be another GOOG out there waiting to take your place!

Sam Loh | Jan 20, 2007 | 5:54PM

Paypal 1998?

As far as I can remember Paypal and even the X.com were started in 1999. But didn't really get going until 2000. They certainly didn't have 8 millions users in 1998.

The earliest column I could find by you about them is dated August 31, 2000. And I still have the email confirming my Email Address when I signed up for them. Paypal's email is dated 2/21/2000 and X.com's is 2/11/2000.

The fact that this part of your column is so off, when half of it about yourself, makes me take the rest of your column with a grain a salt. And I've been reading your column since 1998. Really.

Pat | Jan 20, 2007 | 6:03PM

The article reveals no real surprises. Google's efforts simply reflect core competency and supply chain management strategies.

Russ | Jan 20, 2007 | 6:07PM

All the best brains in the world are not present only in Google, those best of the best brains are also hired by other companies.

If Google can come up with this type of foresight, so can others. If anybody else is not doing the same then it must be possible that they do not think that it is important. Maybe because technology is growing very fast so that the internet may never fail to meet the needs of people, even if every single person starts to download at the same time.

I will agree with Phone guy.

Building near electric stations does not mean anything. There are rules and regulations about these things.

However thanks for a nice read, and the info. This story was based on opinions and personal conclusions and few facts.

Dialup user | Jan 20, 2007 | 6:13PM

There's an article on Concast in the New York Times today. It covers many of the same issues but doesn't mention Google at all. It's hard to believe they don't see the convergence of cable and internet. It would be nice to read some other experts on the subject. Of course, the history of journalists writing on either cable or internet has been terrible. They either think something's going to happen that doesn't happen or completely miss things that have already happened. They like to focus on the personal issues knowing that most readers can't follow or get bored with technical things. The New York Times has become a girly newspaper.

frankp | Jan 20, 2007 | 6:18PM

Bob,
How does placing three or five or a hundred very-large data centers in every state alleviate the problem of first- and second- mile congestion caused by Bittorrent? You are suggesting that adding more data centers in every state will achieve this, and that's why Google is doing so. But, think about p2p for a moment, and how it works.

At the root of the argument, it is antithetical to suggest that Bittorrent is supported mainly by data centers, to begin with. Bittorrent is peer to peer, and it demands, at most, that ISPs' routers & switches and colocation centers' resources possess sufficient capacity, in addition to the first- and second- mile pipes connecting them to end users being of ample capacity.

Did you mean to suggest that there should be more wire centers, COs, head ends, hubs and colocation centers situated closer to end users? Or did you actually mean data centers, as would be supported by your delving into the number of servers, and how many users shared each server? If you meant the former, then there is some merit to the idea, but it would hardly call for full-blown data centers with tens of thousands of servers. But if you meant the latter, then I would have to disagree with you and suggest that any consideration concerning the number of servers required should be shunted to ground.

Yes, Bittorrent's use demands large amounts of transit and first mile bandwidth resources, preferably situated somewhere between user population centers, but it doesn't demand more servers in data center cabinets, or more data centers proper.

If, on the other hand, you had stuck with an earlier rationale that you once used while introducing the concept of 18-wheeler container-sized drop-ship data centers, and argued that the the proximity of user populations to the data centers and their respective servers that perform search functions for and interact with Google's growing number of Web-based applications bore a relationship to Google's overall processing and response time performance, then that would have been a lot easier to swallow, and another matter, entirely.

But, to suggest that hundreds of times as many data centers would improve p2p performance (when a tenth, or even a hundredth as many, WDM huts and distributed router nodes would do a much better job where p2p is concerned) is just plain technologically incorrect, imo. And hey, I could always be wrong too. So corrections and comments are always welcome.

Frank

Frank A. Coluccio | Jan 20, 2007 | 6:27PM

I am not sure that bandwidth and servers enables video. Maybe if you think streaming video is the future. It is fairly easy for the backbone providers to scale their backbones. Go from 1GB ethernet to 40 GB ethernet and 1 DWDM color to 128 and add router ports.

All of those server must be for some other application. Office applications? Some kind of storage?

Allen Cole | Jan 20, 2007 | 6:38PM

I don't think he is suggesting that google is solving the p2p or bittorrent problem, but positioning to be the servers in a client/server setup where google delivers the content. I don't know how this affects the wire centers, etc. part of the equation.

Matt

Matt Wisdom | Jan 20, 2007 | 6:51PM

Right, any stat will probably tell you that over 75% of bittorrent traffic is basically "illegal". When late adopters (granny et al.) start getting movies and tv shows off the Internet, they'll mostly pay for "legal" content from fast close-by servers.

And that will definitely be the case for streaming data, such as your phone calls.

In essence, the article states we'll need one more level of indirection and replication to scale to the demands of the next Internet. Not that sure Google will beat everyone (Akamai?) to the punch

Andres | Jan 20, 2007 | 8:45PM

Google seems to like exerting its influence quietly, behind layers of technology. This model follows that observance - the cable companies, ISPs, etc. will set prices and deal with customers, with Google getting paid (and controlling) behind the scenes. BUT, the cable companies/telcos etc are historically scrappy fighters and not generally the kind who pay to play. Why should they let Google have it so good?
I think there has to be more to the story that benefits your "marginalized" players. I don't doubt there is, but I don't see it yet.

John Andrews | Jan 20, 2007 | 9:28PM

Wi-Max me buckos, Wi-max..

When Intel first touted the wi-max system, they talked about broadband levels of speed performance; eventually faster than todays cable; and all things considered, they can probably make it happen.

This solves that "last mile" problem pretty effectively, but it also gives you everything the Internet can give you, everywhere, without wires~ things like VOIP, television, movies, news on demand, (etc.), in all locations, all the time. You get to kill the telcos, news, and entertainment sectors all at once! Just take away the wires and add.. Hmmm.. What's that Steve Jobs been up to lately? Now, I would not presume to guess whether such speed will ultimately materialize, or even be exceeded by wi-max (or the like),(and then there's all that radio frequency bandwidth that's opening up heading towards 1 TERAHERTZ!)(or HEAD-MOUNTED displays- what ever happened to them?)(or 1.8 inch 100GB hard drives!), but can you say "wireless-BROADBAND video telephone pda google-data-center-applications palmtop IPOD"!??

You see, APPLE is up to something too, and it's not too far of a stretch to speculate that it involves high speed wi-max either..

All of EVERYTHING, all the time; EVERYWHERE!

Nah, Intel wouldn't actually implement a wi-max system that would destroy the media fatcats as we know them, just so they could use it to open up THE ENTIRE THIRD WORLD(!!) as a market for personal computers! Nah.. Not a chance! They're not that smart???

I'll bet Google & Steve Jobs think they are..

Lawrence | Jan 20, 2007 | 9:48PM

How can IPTV content be efficiently distributed around the Internet? How about a bit of simple math. Where are the slowest pipes? How much data can an Internet subscriber actually access via their ISP?

I got a hint for you . . . If you were thinking Google was going to control the bandwidth and create a shortage, you are dead wrong. If IPTV over the Internet takes off, the shortage is already here.

Before anyone writes any more enlightened columns or comments, drag out your calculator and do some mathematical research. All the Internet providers are all scrambling to figure out how to get big pipes (as in gigs) to the Internet.

Sam | Jan 20, 2007 | 9:51PM

Why was my post not made that I submitted earlier today, I think around 3pm? I spent a long time writing that up and thought that I made good points especially tying together Bob's previous articles?

If it is because of my email address, I have a catch-all that allows me to trace when a website sells or gives away my email address. I will still receive the email regardless and will be able to tell whether the email came from the site I supplied it to or some other site.

--Richard Burk
207-567-3928

Richard Burk | Jan 20, 2007 | 10:54PM

It may be hard for some to believe right now, but tough economic times lie ahead when this giant credit bubble economy of ours finally springs a leak. We'll then see unprecedented levels of mergers in major industries and perhaps nationalization of sectors like the airlines and aircraft manufacturing. All in the name of national security of course.

Google is just doing what any cash-heavy corporation would do -- placing its bets and buying options so they will be well positioned when the bottom falls out.

Josh G | Jan 20, 2007 | 11:01PM

It may be hard for some to believe right now, but tough economic times lie ahead when this giant credit bubble economy of ours finally springs a leak. We'll then see unprecedented levels of mergers in major industries and perhaps nationalization of sectors like the airlines and aircraft manufacturing. All in the name of national security of course.

Google is just doing what any cash-heavy corporation would do -- placing its bets and buying options so they will be well positioned when the bottom falls out.

Josh G | Jan 20, 2007 | 11:02PM

I think this scenario is very unlikely. Wholesale, connectivity is pretty cheap and it continues to go down. Multimedia consumption over the internet is on the rise but it is not skyrocketing. By the time media streaming and download become mainstream, fiber will be adequately cheap.

Because of being sparsely populated, the real problem in America has always been the "last mile" to your door. This mile is usually covered by two wires, and tightly controlled by your telephone and cable company. Those companies effectively have the power to determine the price you pay (regardless of the name of your actual ISP) every month. Indirectly, they also determine what do/will we (or the majority of we) use our connections for.

Fast media delivery is rather a problem of whoever is selling it, so unless Google plans to conquer and dominate the (future) movie download market (as in sell downloads or streaming movies), they have no interest, and no money to make in this space: companies like Akamai are already distributing content and anyone can use their services.

Blago | Jan 20, 2007 | 11:07PM

I am going to buy Google stock tomorrow and hold for eternity!

Rad Rysker Dude | Jan 20, 2007 | 11:28PM

Soon Google will offer free add based internet to everyone... mark my words...

Keith | Jan 20, 2007 | 11:36PM

Soon Google will offer free ad-based internet to everyone... mark my words...

Keith | Jan 20, 2007 | 11:37PM

What about the last mile?

Two words; Powerline Broadband

Google has the the last mile covered with this one.
They will not need the Telcos nor the Cable Companies. If they build Data Centers near Power Distribution centers, they have the content right next to an uninterrupted fast lane to homes by deliver content via the power infrastructure instead of needing to get anything from the Telcos or Cable Cos. If they need to connect More bandwidth to the internet backbones, there are nice Right-Of-Ways moving in several directions from a Power Distribution center.

Gozman | Jan 21, 2007 | 1:08AM

I think google will run fiber to everyone's home eventually; I see no one else doing it, so why not?

wireless access point | Jan 21, 2007 | 1:17AM

Gozman,
You may be onto something:
"Last year, search giant Google, media conglomerate Hearst and bankers at Goldman Sachs invested almost $100 million in BPL provider Current Communications. A second round of funding pumped in another $130 million in funding from GE and EarthLink, as well as TXU and Sensus Metering Systems, Ltd."

Blago | Jan 21, 2007 | 1:39AM

Perhaps Google is the only company that can save us from the fate of a newly reconstituted AT&T. I've never understood why Google hasn't sought closer relationships with small businesses -- surely the Yellow Pages market is ripe for plucking? If Google becomes a multi-play ISP, they will know enough about us to extend their AdSense model to a local level... Perhaps Google stock is still cheap.

JulesCA | Jan 21, 2007 | 2:19AM

Beautifully explained. And here's the real kicker: whatever they're pushing through the tubes in terms of content is having some brainwashing affect on the populace. Know why? Everyone and their celebrity's poodle walks around in a drunken delirium barking from rooftops about how great Google is. How they can't live without Google. How they love Google's creamy insides. How they want to name their first kid Google. How everything they need to know about life they learned from Google. How Google got them together, happily ever after.

It's so COOL to hate the behemoth that is Microsoft. And it's so COOL to love Google, the behemoth that makes Microsoft look like a sandbox. Makes no sense.

I can't wait until Google, like Microsoft, becomes that monopoly of a company that everyone loves to hate. I'm starting the trend personally and I do invite you along.

Machine Operator | Jan 21, 2007 | 3:38AM

The problem with your logic is that one of them makes a crappy product that the world is forced to pay for, while the other one is simply the preferred search engine.

Me | Jan 21, 2007 | 4:10AM

Only the brainless google

pita | Jan 21, 2007 | 4:32AM

Only the brainless google

Pitta Puky | Jan 21, 2007 | 4:33AM

Google is even more smarter then you think. You wrote: The company appears to be as attracted to cheap and reliable electric power as it is to population proximity. The answer is simple. It is not about cheap power, but about cheap networks over exisitng powerline. For that the data center have to be close to a powerplant. This is how google go to dominate the internet and serve enough bandwith to provide video...

bilogic | Jan 21, 2007 | 6:07AM

I think that Google is concerned about both Carbon emissions and the approaching unreliability of petroleum-based energy. I think they are snapping up all this land because they are getting ready to try and kick-start the biofuels industry in the States. They are going to start a Miscanthus farm. I am going to stay tuned, this should be interesting...

William Koplitz | Jan 21, 2007 | 9:55AM

Bob, awesome article. Google is competing for eye balls against Microsoft, Yahoo!, IAC, Amazon’s A9, right to but Google could very well only be in consumer traffic and advertising businesses because of short term necessities until a viable grid computing business model emerges.

Search is the OS enabling content applications to deliver media experiences. Search is the Internet OS providing core services upon which content applications run and communicate with underlying infrastructure services. Think of the search ecosystem as a 3-layer value chain: 1. Media: everything content related, wherever it is, 2. Content applications: Web, media players, communication applications, ... and 3. Search as the information OS: crawling, indexing, computational linguistic, data mining and semantic analysis,….

Google thinks of Search as the Internet OS, very much focused on developing, surfacing APIs, inviting developers to contribute value-add services legitimizing and extending their reach. I am not sure I subscribe so much with some analysts' belief that Google will remain a media company, which does not mean they don't need to get closer to media companies. Google’s culture and top management layer is made up of technologists, not media folks as is the case at Yahoo! Crawling, indexing, computational linguistic and managing consumer media businesses definitely don’t require the same core competencies.

-arnaud

Arnaud Fischer | Jan 21, 2007 | 11:23AM

Interesting analysis!

Morten Blaabjerg | Jan 21, 2007 | 11:23AM

To add to my previous comment, (see Jan 21, 2007 | 1:08AM)

While a jump in video consumption will demand more bandwidth, technology is blasting forward; companies have far greater ability to compress video and store Monster amounts of video. Apple has X-Grid Software(think enormous volume, fast compression) Xserve Servers(just a few months away from 8 Processor power)and Xserve RAID storage capacities. Once compressed and delivered to the home, consumers already have a greater ability to decompress it(like my $600 Mac Mini with a dual-core processor with EyeTV w/Pinnacle HDTV USB stick playing and storing HD TV right now.) What this means is massive capacity in the last mile is becoming less relevant(Fiber covering the last mile would be cool but is really no longer necessary because of the increased ability to compress and decompress Video)

BTW...Blago, thanks for the concrete background info on my previous comment; the power of Blogs & forums at work!)

Gozman | Jan 21, 2007 | 12:09PM

Realtime distribution of widely viewed content (not pull but push) is best done by satellite. Despite higher latency (which doesn't impact multicast), the efficiencies of dropping the same info into every location without replicating traffic on the net are enormous. Look for Google and others to make some bets in this sector as well. There are some really amazing capacities being discussed in bands at 40GHz and above that can fill local servers.

Peter H | Jan 21, 2007 | 2:27PM

Google's CEO is on Apple's board.
Apple releases Apple TV which will need tons of bandwidth.
Just how are they going to get all that data to South Carolina? They'd need tons of that bandwidth they've leased. Or, the could use Project Blackbox which IIRC was developed for, you guessed it, Google. No need to build large buildings in every state. Just park some Project Blackbox containers on the property.

David Lee Heyman | Jan 21, 2007 | 3:24PM

They own youtube and google video, which I assume takes massive resources. Also when you get 220 million queries a day, there's insane potential in analyzing the data and creating insane, INSANE, statistically accurate reports that ensure future wealth. Good statistics analysis is worth the massive cost of datacenters... There's a LOT to be analyzed.

OR | Jan 21, 2007 | 5:40PM

When reading your article I was reminded by this Wired article from last year on Google server farms and future developments:
The Information Factories - by George Gilder

Whirl | Jan 21, 2007 | 7:36PM

"I think Google is building for a future they see but most of the rest of us don't."

Skynet?

Ed | Jan 21, 2007 | 10:52PM

"more than half of all Internet bandwidth is being used for BitTorrent traffic"

What is your source for this statement?

Ken Bannister | Jan 22, 2007 | 12:03AM

Scary.

milo | Jan 22, 2007 | 12:07AM

The main reason of google to grow in such an unpredictable and massive amount is that it is the "sole" implementer of "customization". Unless the competitors of google (if still remains?) see this and go ahead of its cleverly strategy, we, all oround the world will go on using its search bar as it is the adress bar. We've enhanced it ourselves, because it deserved. It has broken the oligopoly of yahoo and msn, who exploited the internet users for years without offering any innovation and ease. Why all people switched to Google and G applications?
The answer is that result suitability with your queries. Only Google devised there was no need to meta tags. So we must let them collect what they deserve.

Kazim MAVUS | Jan 22, 2007 | 2:45AM

Do you think your musings on why Eric Schmidt joined the Apple board could have some relation to these mega data centers? Imagine Apple placing some sort of bittorrent client in it's iTunes software to pull content from these Google data centers so your download of full HD movies and TV shows was fast enough to allow your Apple TV unit to replace cable box completely. Apple starts pushing real time sports and news via iTunes and Apple TV. Google provides the backbone (and advertising?)

beggs | Jan 22, 2007 | 3:20AM

One thing I'm curious about, BitTorrent scales in an intersting way, somethign that the guys at Skype have figured out. Inside an ISP there is plenty af bandwidth between users, the main probelm then becomes the Asymmetric in ADSL.

The main problem with this is that it only works for the most popular content. Google will be looking to take advantage of the long tail combined with search. Specifically finding the random content that you are interested in.

Simon | Jan 22, 2007 | 4:19AM

good @ one

sanjeev | Jan 22, 2007 | 5:40AM

Some people call you an astute commentator. I think you are very smart - but not a great analyst, just really good at stirring up traffic and controversy.




These seem to be your observations:

- Google is buying lots of dark fiber

- Google is building lots of new datacenters

- Google is building some of these next to power generation facilities. (IE: cheap power, something you don't mention)


So you create an elaborate conspiracy theory. However, your theory is not falsifiable - there is no way to prove you wrong. We could be waiting for the other shoe to drop for years, and you'd still not be wrong yet.



Here is an alternate theory that explains everything:

- Noting that power is important to datacenters, build datacenters near cheap/reliable power. Given Google's eco-orientation, build it near non-fossil fuel power if possible.

- Clearly networking bandwidth is essential to google - thus it is impossible to have too much. Just as it's impossible to have too much storage space.

- Google's business is growing - look at those revenue numbers. Maybe this has something to do with needing more datacenters?



See the problem is, both theories explain the observable evidence as you noted well. However, mine is simpler, thus more likely. Occam's razor, you've seen Contact I take it?




As if buying out/taking on/owning last-mile operators would be a good idea. Those areas are not exactly hugely profitable, plus anti-trust might make life annoying.




Robert, your conclusions are wild, sloppy, and highly speculative. Why not impress us with something well thought out?

ryan | Jan 22, 2007 | 5:47AM

Ha, You're all not seeing it. It's not the last mile providers that are on the endangered list, its the local TV broadcasters. Imagine 100,000 people in NC watching The Simpson's or whatever, and each TV set receiving a customized advert schedule. Oh, Joe was searching for tires and just got a promotion (Google knows) we'll send him the Toyota and car loan ads.
TV remains the most effective way to advertise and Google knows how to increase its value.
Content and delivery (as always) we be someone else's problem. Google will only customize the advertising using its algorithmic technology and data centers.
-jcp

jcp | Jan 22, 2007 | 6:40AM

Google has a P/E ratio of 62, which is very high.
Maybe this theory can explain it...

Yohay Elam | Jan 22, 2007 | 8:36AM

Broadband over power line sounds more feasible than running fiber to every ones homes. Also when is NTV season 2 coming out.

Brandon | Jan 22, 2007 | 9:12AM

Interesting thoughts. However, Google (or anyone) will only be able to control so much before the regulators step in and put limits on them. History has shown this in other industries. Google has enjoyed a lot of success to date and largely stayed out of trouble. My guess is that their legal woes will grow considerably in the next couple of years and they will be handcuffed much in the way Microsoft has been.

sm | Jan 22, 2007 | 9:15AM

Running a server for every 40 people would require about $25/year per person (from my very rough estimates). Could Google get this from providing high bandwidth content and wacking on personalised ads? Id say easily..

rusty | Jan 22, 2007 | 9:28AM

Ever heard of Akamai? This already exists. It's not a "secret plan." But I do agree that Google has enough cash to actually build out enough to accommodate a "video laden" Internet. Perhaps Akamai can, as well, and they have over a decade of experience doing it.

Charles

Charles Soto | Jan 22, 2007 | 9:49AM

How could Google be accused of holding a monopoly if they are simply offering services on what they built themselves? Compare this to Telcos' ownership of fiber that was subsidised by public funds.

Ryan | Jan 22, 2007 | 9:56AM

1) Google is replicating Akamai's strategy with data centers on the edge (vs. just content servers)which in the long run is the way to go. Buying everyone in your neighborhood to eliminate competition is a neat strategy
2) Google is slowly(but surely) taking over presentation e.g. using a Treo it is much better to visit the site via the google search engine results as google seems to better adapt the site for the Treo form factor

samson | Jan 22, 2007 | 10:11AM

Ryan asked how Google could be accused of holding a monopoly. That's not what was said. The word was anti-competitive. Monopolies are not illegal in the US. Abusing the monopoly power to gain an advantage over a competitor is illegal.

Off topic side note on that: Microsoft has been a monopoly for a long time. However, the courts had to rule if Microsoft's *actions* were legal or illegal.

Back on topic. Is Google a monopoly? Maybe. Are they abusing the power they have? Not yet, and hopefully never.

Jeremiah | Jan 22, 2007 | 10:40AM

Google can't undermine the ISP's and last mile providers. The last mile connection to the end user has and will most likely continue to be a commodity. As new delivery technologies come to market and mature, the last mile connection gets faster, yet the costs and profits stay relatively the same.

I think Google, with the purchase of YouTube, has and will continue to move into the content game and realizes that having data centers at the edge of their network decreases their bandwidth costs to push content out to the masses.

Content is King and that's why the MPAA and RIAA continues their onslaught against the thieves of their content.

Oh yea, and if Google gets too big for our own good, the telcos and cable companies will enact a Google-tax…

Herschel | Jan 22, 2007 | 11:05AM

In reference to "are they abusing their power?". You bet! They are patent spammers and, if even partially successful, will put many, many small software companies out of business.

Wildbongos | Jan 22, 2007 | 11:48AM

Dear Google,

Please provide service in the greater York County in South Carolina where the evil corporate monopoly of Comporium resides.

Sincerely,
York Co. resident that is sick of the local monopoly (Cable AND DSL) jacking up their prices x2 of what the norm is for no reason.

slackbuster | Jan 22, 2007 | 12:37PM

Yup. I hear Google's had a presence in North Carolina for years. Little place called Hootin' Holler. Great place to escape from the revenooers.

Jughaid | Jan 22, 2007 | 1:16PM

Google-tax...riiiight. Google is to big already and ISP's would fall if they issue a tax like that. I really do not think this article is too far off from the truth. fyi, if google is the owner by lease of the line's then each ISP or bandwidth provider has to pay google for using it. No wonder they keep getting richer. Brilliant strategy. It's like Bill Gates for search engines and the internet.

chaos | Jan 22, 2007 | 1:17PM

Will Google brings to our future a "Blade Runner" reality???? I'm afraid Google...LOL.


Nelson Biagio Jr | Jan 22, 2007 | 1:26PM

I think the answer to why Google is leasing/renting so much bandwidth is more simple, but boring, than your speculation:



  1. By leasing/renting instead of buying Google is NOT acquiring an expensive asset that they may want to get rid of later. It gives them the flexibility to size their fiber assets to their actual and projected needs while also allowing them to chase the least cost provider. I look at it as the fiber equivalent of Southwest Airlines hedging their fuel costs.
  2. It's bargaining power versus at&t and their ilk. With at&t's CEO making noises about taxing anyone who dares to use Google, it would certainly be nice for Google to be in a position to reciprocate.



Not as sexy, I'll admit, but it seems more reasonable to me.

J. Buckley | Jan 22, 2007 | 1:32PM

I also don't think it's as exciting as all that. A company built on web-based services needs data centers, and electricity is probably one of the biggest costs in running a data center, so of course they are going to locate where the power is cheap. What the author doesn't mention is that Yahoo and Microsoft also have data centers in Oregon, where there is a glut of hydroelectric power
(http://money.cnn.com/2006/07/26/magazines/fortune/futureoftech_serverfarm.fortune/index.htm)

Andrea | Jan 22, 2007 | 2:16PM

Clearly there are historical precedents for these predictions. The late 19th and early 20th century battles over electric power production and distribution come to mind, as do those over control of oil and gas infrastructure. I am also struck by the fact that this hypothesis provides a basis for continued growth of Google stock value – a compelling one at that.

If such a powerful force emerges to control so much basic media doesn’t the public have a need and right to ensure some level of openness and access? I think we are facing the serious question of how we can create viable public policy when changes like this happen so fast and in relative obscurity. It would be nice to hope we can do a bit better job at managing this technological change than our ancestors – or that we at least will not be worse at it!

Cecil Thornhill | Jan 22, 2007 | 2:18PM

It might be helpful to take a step back and look at Google from a different perspective. In the early days it was interesting that Microsoft wanted to stay out of the hardware business. They put all of their efforts into software and in making sure they could serve the customers of several hardware makers. Conversely, most PC makers pretty much stayed out of software. Google seems to be mostly into services. They enable us to find resources on the web and firms to connect with potential customers. They enable others to do business.

What if Google does not plan to be the originator of new forms of content, but rather the delivery mechanism for others. What if they are also quietly going around and signing deals with media providers too? I remember a couple weeks ago in Mr. Cringely's column -- Apple was not happy with Akamai. Then it occurred to me, what if Google was going after Akamai's business?

If Google becomes the next Akamai with an order of magnitude more network bandwidth, computational power, and storage -- what else could they do? They could provide an assortment of IT services to businesses too!

John | Jan 22, 2007 | 4:43PM

google google !! I can very scare of that verb

nick | Jan 22, 2007 | 4:43PM

Although this may seem to make sense - it doesn't account for the possibilities of Wireless Mesh. The assumption in this article is that all content will come from content aggregators, through one pipe but it can also come from many sources. As Bit Torrent is peer-to-peer so can Wireless Mesh be. Google may be able to control the pipes between large urban centers... but within them... I not so sure. Maybe Google won't be the world largest proxy... maybe my neighbors will hold some content, and their neighbors and so on. We've democratized content - we will democratize the network too.

Yuri | Jan 22, 2007 | 4:49PM

More is better and synergies may develop.

Many of the comments on this matter give additional not singular reasons for Google's actions. There is nothing wrong (at least from their stockholders point of view) having two or more good reasons to do something.

Rick Moncrief | Jan 22, 2007 | 4:54PM

Google is going to do broadcast internet. The big files come down this way. Payment can be done with existing dial-up lines.

jimbo | Jan 22, 2007 | 4:55PM

This all seems very plausible and would not suprise me. Another factor of interest is that Google is (in the lead in) fighting for Network Neutrality.
I would not be suprised to see the Independant Telcos (MultiMedia Service Providers)begin developing peering relationships with Google vs AT&T and Sprint, if Google was open to them.
The battle here will be between the Nationwide providers while the Service Providers battle to keep the Last Mile and try and to control how they can price/package Broadband services to their clients-Google still needs the last Mile and the ISP do not control that piece.


Jacomo

Jacomo | Jan 22, 2007 | 5:00PM

That's it!! Google just bought youtube!! Brilliance

amester | Jan 22, 2007 | 7:51PM

The other benefit to being near power plants is that it makes it easier to tap into them for Broadband over Powerlines... Google could become an ISP for anyone with power to their home (ie: nearly everyone) and have nearly limitless capacity and broader coverage than cable, dsl, or wireless providers.

Richard Anderson | Jan 22, 2007 | 9:08PM

not to be surprised

ahir | Jan 22, 2007 | 10:21PM

if this really gonna happen then we must start buying google's share. (smell money in the air)

lok7 | Jan 22, 2007 | 11:19PM

Well, at least they are providing the means to monitor them...
Watch this space!

Liam | Jan 23, 2007 | 4:05AM

Bob, sorry to pick nits, but PayPal didn't launch til October 1999, and didn't reach 8 million accounts until 2001

David Watts | Jan 23, 2007 | 7:45AM

Net Neutrality is a critical issue for Google.
If Yahoo will buy a better service for their videos, Google will not sell ads to accompany YouTube clips since Joe Shmoe will download from Yahoo.
It's all about market share and access to advertising channels. That's why I said above that Google wishes to be best of friends with the last mile owners.
It's not just YouTube, Gmail or Calendar.
How about housing your corporate data center?
Conduct your marketing campaigns through Google and they will give you a good price for both.

For that, you need to be close to your customers with reliable means.

Moish | Jan 23, 2007 | 8:04AM

They're building a huge data center in NC, too.

dep | Jan 23, 2007 | 9:30AM

Google $600 mln datacenter today is $300 mln in 18 months. They want to be first and pay high price for this.

There is no needs to make speculations about that Google can do other that search engine. They still have a large area for improvement. If somebody will outperform them in search results - Google will be dead company.

In order to see that kind of search engine is already possible - visit http://start.csail.mit.edu/ and ask "Who is Cringely ?"

TAG | Jan 23, 2007 | 9:58AM

But how do these data centers help with the last mile issue? DSL and the rest have limitations, I don't how long it would take to download 2-3 hours of High Quality video useing existing pipes into the homes, SO how will data centers help?

Rob Myles | Jan 23, 2007 | 1:49PM

This article is very interesting if you think in Apple TV and TiVo on this scenario... Think!

Hugo Barauna | Jan 23, 2007 | 2:15PM

Wow, what a profound revelation!! The real "new AT&T" has been revealed. For some time now I have wondered what Google was planning to do with all those data centers and all that cash. I also wondered how video in large quantitites would be possible via the Internet. It makes perfect sense.

As a last mile provider myself I can see that my fiber to the home business model will change dramatically as Google delivers video down "my" pipe. And to think I thought I was going to be the content provider. Hmm.....

ELD | Jan 23, 2007 | 2:19PM

I get 15/2 of Virizon's FIOS aka Fiber-to-the-door type of deal. And I still hit bottle necks, except they are not at top tiers of where the data is coming from not the last mine, heck the last city loop I'm in.

This is an intersting theory.

I dunno if I like the sound of that.

Too bad MSFT didn't do that...

campus coder with a k | Jan 23, 2007 | 2:31PM

Where does this leave Akamai?

jc | Jan 23, 2007 | 2:36PM

Google has already invested in BPL with Current Communications and TXU (large Texas utility).BPL already is 200mbps (gross)and one european supplier (DS2) is close to a 400mbps upgrade and another (Gigle)claims to be a couple years away from 1GBPS. In addition to the lines, utilities own a lot of real estate. Picture a fiber fed Google center at substations bridged over to BPL on copper and/or WIFI or Wimax broadcasting from utility poles. Once again Google owns nothing, merely renting. ATT is bridging from fiber to copper with their UVerse but the telcos are left with the legacy costs of their copper circuits, Google gets almost a free ride on the power lines which are the only wire any house actually requires once voice and data are put on it. The other two become redundant

jc | Jan 23, 2007 | 2:46PM

Google has already invested in BPL with Current Communications and TXU (large Texas utility).BPL already is 200mbps (gross)and one european supplier (DS2) is close to a 400mbps upgrade and another (Gigle)claims to be a couple years away from 1GBPS. In addition to the lines, utilities own a lot of real estate. Picture a fiber fed Google center at substations bridged over to BPL on copper and/or WIFI or Wimax broadcasting from utility poles. Once again Google owns nothing, merely renting. ATT is bridging from fiber to copper with their UVerse but the telcos are left with the legacy costs of their copper circuits, Google gets almost a free ride on the power lines which are the only wire any house actually requires once voice and data are put on it. The other two become redundant

jc | Jan 23, 2007 | 2:46PM

It is always fascinating to be at the ground level of one of these things. I guess the last couple of times the earth shook were: when the original ARPAnet first went live in '69, when the IBM execs met with Bill Gates in 1980, and now we are possibly witnessing the transition of Google from Internet powerhouse to established national utility.

Jerome Wiley Segovia | Jan 23, 2007 | 2:50PM

Data centers are located at power plants because the power is cheaper there, they buy wholesale and avoid distribution charges (check your electric bills and see how much is for distribution).Data CAN be put on high voltage lines but it's cost effective to use fiber. By the way there are electric cables (the lightning ground lines)that have fiber sandwiched inside.

Utilities are the perfect passive partners for Google. They are fragmented, not cpaital rich and risk adverse - very happy to collect some rent for the use of their lines and facilities and gain better control over their system through a "Smart Grid". The smart grid would save the country billions thru more efficient energy use. Maybe Google will jump into that with a share of savings arrangement.

jc | Jan 23, 2007 | 3:14PM

If I were Microsoft, Yahoo or any other big player in the Goog space that was worried about GOOG getting a stranglehold on the internet like this I'd buy Akamai.AKAM has asomething like 20,000 distributed locations. Maybe GOOG will but them

jc | Jan 23, 2007 | 3:17PM

If I were Microsoft, Yahoo or any other big player in the Goog space that was worried about GOOG getting a stranglehold on the internet like this I'd buy Akamai.AKAM has asomething like 20,000 distributed locations. Maybe GOOG will but them

jc | Jan 23, 2007 | 3:31PM

Speaking of AT&T; why couldn't an anti-trust suit like the one that led to the Bell System divestiture, be filed against Google?

Mark Ossen | Jan 23, 2007 | 3:45PM

How about if instead of installing a second 200GB hard drive in my pc, I rented 200GB of space from Google, on which to store my apps and data. A high speed connection and a small local cache would mask the access delay in most cases, and could easily be made completely transparent. Add in the bonuses of automatic backups/restores, and the ability to access and use "my computer" from any computer on the internet... I'd pay for that.



Of course, it'd need many huge data centers and lots of bandwidth to make it work well. Just saying.

PaulT | Jan 23, 2007 | 5:19PM

"even if services come along that are superior to Google's, in order to become dominant they'll have to overcome Google's brand recognition with users, which is almost impossible to do. So just being better than Google isn't enough."

You could have said all of that about Yahoo in 1997, before Google came along.

Bog | Jan 23, 2007 | 6:41PM

"even if services come along that are superior to Google's, in order to become dominant they'll have to overcome Google's brand recognition with users, which is almost impossible to do. So just being better than Google isn't enough."

You could have said all of that about Yahoo in 1997, before Google came along.

Bog | Jan 23, 2007 | 6:42PM

PaulT - the oft-mentioned gdrive is always a possibility (and it's something that's been done quite a few times already, but I think Google is looking far beyond the concept of networked drive access. I'm not sure if Bob is on the money here, but it is definitely of the scale on which Google thinks. Personally, I'm wondering if it's more directly tied to their other ventures, like how it will complement or work with their muni-wifi plans.

Kenn | Jan 23, 2007 | 7:03PM

I think Google could also use that leverage for a nice WiMAX network. Whatever they decide to do, it sounds very interesting to me because I born and raised in Columbia, S.C.

Rubin Middleton | Jan 23, 2007 | 8:42PM

Google's building a new datacenter here in NC too, and in a weird place. In fact, the state of NC is giving them something like a $4 million bonus for choosing that location, which has recently been hit by heavy losses in textile and manufacturing jobs.

RedWolf | Jan 23, 2007 | 8:54PM

The article was insightful. I also believe that Google wants to replace Microsoft entirely and intends on being your computer and your hard drive. Google is hungry for information as a lever for its own commercial objectives as was pointed out in the article. This is ok if you do it under your own roof...i.e. the Google engine-- but to gain an advantage of this magnitude and use it for gain would be analogous to a predatory practice and smell of unfair competition...And if the Feds don't get involved, they would likely face a backlash from the very communities that they affect. As we know, in a free society such as ours, this would be a very serious repercussion. Yes they could do this commercially and provide Microsoft with an opponent, however, they would need to do it while respecting the privacy of users and they would need to do it in a way that is backwards compatible to the way computing and the internet is used by the general public, corporations, advertisers, web publishers and networks and they could not use any information for commercial gain any more than the phone company is able to analyze your telephone behavior and use it to target you for gain.

Jane Stone | Jan 23, 2007 | 10:57PM

Except for the slight problem that the phone companies control the access. If Google can manage to find a way around this, which you can see telegraphed in their Wifi efforts, then your prediction could come true. Otherwise consider that most of the phone company market cap is linked to monopoly access control and not to the core network. Google's strategy still has merit but probably won't result in the sort of network world domination you envision...

Rod | Jan 24, 2007 | 7:47AM

Bob -
Here's one for the black helicopter crowd - or maybe not. Suppose those bandwidth purchases, in addition to the purposes you suppose, are also trojan horses? If Google's got good lawyers, it wouldn't be hard to slip an innocuous "non-discrimination" clause in the lease. That clause would require the carrier to give Google traffic - ALL Google traffic, on the ISP's public net and Google's vpn/dark fiber, a precedence no lower than any other customer. Sounds harmless, but completely guts the anti-Network Neutrality dreams of the carrier's executives. Think a carrier would never agree? How many would let millions of dollars of guaranteed revenue walk out the door to protect a scheme that might not come to fruition?

sysadmn | Jan 24, 2007 | 7:54AM

I agree that what you suggested will happen eventually. But I think what will happen first is that google will work deals with all (most) the Video Companies like NetFlix and Blockbuster. The business deals are to distribute their video across all of these hubs saving Blockbuster money. It will be worth it to the Blockbusters, and google will make money based on number of downloads from their servers. Blockbuster doesn't need to host all that video. It will just look like they are.

Jeff Jak | Jan 24, 2007 | 10:51AM

Bob,

It looks like the SUNW dog (Sun Microsystems) is not lying down. This KKR deal for debt and Intel support is a real puzzler to what they've got cookin' for the next two years. It seems that there's no middleground with them. They're either going to do something very smart or very dumb over the next two years.

SteveH | Jan 24, 2007 | 12:27PM

I don't see GOOGs business model working indefinitely. They exist at the whim of content creators who give free access to the googlebots thereby giving free access to end users. As content creation is not a cost free endeavour, I would expect the creators to lean into the YHOO type fold (paid agreements for content).


Of course GOOG is also susceptible to the collective whim of the end user who really has no cost in switching search providers.

A ship that could sink faster than you can say "titanic".


BobLima | Jan 24, 2007 | 2:35PM

Very good article, and very plausible predictions. However, if you stop and look at the (MUCH!) bigger picture, you could also see that there's a limit to how much of the internet that Google could control...

The US's population, is 276 million? Remember, it's not the ONLY country in the world! ;) Compare that to the growing economies, primarily India and China. Their combined populations come to a whopping 2.25 billion - nearly 10 times the population of the states!

Google would have to build a HELLUVA lot of data centres to cover *those* markets...

Dino | Jan 24, 2007 | 5:38PM

there are so many flaws in this theory that I don't have time to discuss them all. but here's the quick and dirty...

#1 ISPs like AT&T and Comcast control the last mile. Period. How is Google going to bypass that no matter how many server farms they own in the back woods of every state.

#2 Google already requires massive amounts of storage capability for the services they are already running (Search) and intend to run (online applications such as spreadsheets, personalization, etc...). They are simply building large expandable redundant data houses which can grow with storage needs for decades.

#3 Google knows they can't own everthing, and nor do they want to. They need 3rd party providers more than anyone so they can remain nuetral to content players, hardware guys, etc...

J | Jan 24, 2007 | 8:42PM

Re: #1, the last mile you speak of is -- copper, no? Personally I'd be interested in how much RF bandwidth they're buying up too. WiFi skips the last mile. Didn't Goog have something to do with providing (or intending to provide) free WiFi to San Francisco? Worth a look....

NefariousWheel | Jan 24, 2007 | 10:02PM

goo-GOOG-ga-joob.

In response to Mr. J 'flaws' lead off:
"#1 ISPs like AT&T and Comcast control the last mile. Period. How is Google going to bypass that no matter how many server farms they own in the back woods of every state."

"Period." Whaa? Like terrestial TV and Radio are still such fixtures in our lives? Huh? How old are you? It's only by Gov't meddling that TV still gets pumped through the air to po' people's houses. Each new generation of connected tech wipes-out the previous... takes time. Use a telegraph lately? How about a POTS line? Ah, cellphone eh? Cable has a tierra right now, but she's a getting fugly.

a.) GOOG can make a deal the wireline cartel and/or
b.) Broadband is going wireless; check out LMDS & MMDS - makes the little n-router you were planning on upgrading-to look like sytrofoam cup with a limp string. Pull the glass from region to region, then blanket with a tower. 28 mile radius per tower... 2 guys on a tower verus 80/800/whatever in a truck for a city, etc.

Hiptrigger | Jan 24, 2007 | 10:08PM


don't forget BULLET TRAINS.

they just need to start out with a vancouver to san diego line; then one from atlanta to boston, one from philadelphia to chicago... shit, just start with one from LA to Vega$ or SF to LA. it'll be mobbed. they'll start popping up everywhere.

once they control the servers, they're building bullet trains !

srini @ StickerNation.com | Jan 24, 2007 | 11:39PM


I believe you are giving GOOG a bit too much credit and you are peering into a crystal ball which may be clouded with some sort of LSD.

goog-sham | Jan 25, 2007 | 12:43AM

Now we know what those "mobile data centers" are for.

Cookie cutter mini-Google centers that can just be plugged in to every ISP.

It's an offer they can't refuse!

Glen Brownworth | Jan 25, 2007 | 3:39AM

The US government, as always, will be caught between the competing needs to regulate monopoly, promote competition, and defend the USA against outside threats.

I suspect they'll do nothing, since world domination by Google is tantamount to world domination by the US. While middle-east nations control oil the US seems to feel the need to exert ever more power, and a powerful Google would help.

David Cowen | Jan 25, 2007 | 4:00AM

I'm the head of global strategy for a large internet company. I've been watching Google's dark fiber buy-up and data center deployment for some time and have another hypothesis on Google's fiber strategy:

The greatest threat that Google faces is the possibility that ISPs will collude to begin charging Google for access to their subscribers. This would be transparent to the consumer (like basic cable channels come for free, but cable co's charge the producers a fee). The current Net Neutrality debate is evidence of this. Google has amassed a fortune from the habitual use of millions of users but they don't have a direct line to those users. The ISPs are an intermediary. This is a tenuous strategic position and is a big concern to them. So, in order to gain leverage over the ISPs and ensure their "cooperation" in the future, Google is doing an "end run", buying up dark fiber capacity with the intention of becoming an important supplier of bandwidth to the very ISPs that might one day be tempted to hold Google hostage. It's a very smart, forward-looking move.

In addition, the data centers Google is deploying (a few of which are these monster campuses mententioned above and hundreds of which are smaller "data-centers in a box" (thousands of servers and terabytes of storage in a self-contained cargo-container place along existing fiber backbone nodes) will allow Google to provide not only bandwidth, but also virtual desktops (O/S)and web-service office apps to millions of users, served from virtual machines in the datacenter. This will present a huge threat to the Microsoft OS/Office monopoly. Users will subscribe to these services through their ISP. Another potential strategic weakness for Google which their dark fiber leverage will help them neutralize.

EliotJ | Jan 25, 2007 | 1:09PM

Insightful as always. Like all big companies wanting to grow their business, Google must also be looking for areas in its domain of expertise viz. internetworking to make big bucks in and being the data hub of the internet is just such an area. Besides, Google cannot afford to rely on its search technology for ever and in that respect I would like to differ with on the following:

"...if services come along that are superior to Google's, in order to become dominant they'll have to overcome Google's brand recognition with users"
- Let's recall that Google rose to the top of the heap of search engines purely on the basis of being the (much!) better search engines. Skrenta's argument is a bit more valid when you are locked into a 2 year contract with your cell phone company. Google has shown that on the internet, when a free and superior service show up, the flock all but abandons the current darling.

cringely-fan | Jan 25, 2007 | 1:31PM

The truth based on fact has been killed by the media and its government stooges.
Minnow was right the WASTELAND has won. Look around you.
Ideas are not any longer winning. Spin is winning.
Maybe T. Jefferson was correct: "the tree of liberty needs watering with the blood of patriots every now and then".
Sincerely,
Feed Up

trippi Adams | Jan 25, 2007 | 2:17PM

Google is planning on taking over data center functions for small and medium-sized businesses. Before long we will be able to purchase a data center package from Google that will meet all of our core IT needs such as storage, front office applications, and security. Google's data center and bandwidth purchases are in preparation to realize that goal.

Here's a hint:

http://www.networkworld.com/news/2007/012307-google-apps.html?t51hb

syoung | Jan 25, 2007 | 3:55PM

HipTrigger, check your speeds. My cable broadband right now is slower than my dial-up from 1997. Websites have richer media, and cable company has more subscribers on a thin amount of equipment. There's no room for video. And we are all waiting for glass fibre, but that's where the net nuetrality debate exists. WiFi is too weak, and so is Wimax. You can't do video effectively thru them, too slow, DOA.

The last mile is still a giant problem, mainly because it costs A LOT of money to make it work fast. Google has no direct way around this, they are subject to the last mile. A small WiFi/Max mesh network around Mtn. View, CA isn't going to change that, not even in Mtn View CA.

EliotJ presents much more sensible information above than the article we're all commenting on; however, I really don't understand the strategy he talks about. How is Google going to give last-mile providers any trouble by buying dark fiber that runs into their own datacenter? Google is just buying the fibre they need to serve their applications online in advance of what they anticipate will be much greater adoption. I don't see how they can put any pressure on last-mile ISPs doing this?? Can you explain that one a little better?

Now if Google simply buys LVLT and another big boy in the middle of the country selling long distance fibre lines in a monopolistic fashion, i suppose that could do a LITTLE damage. But the ISPs can simply provide most of the content locally and build their own data centers with all the money they'll be getting from YouTube and MySpace.

One day, one day wireless might be the answer, or maybe even satellite (doubtful due to horrendous upload ability). But those days are much farther off than net nuetrality concerns which I think are current even in 2007 as we see more shows go online such as Desp Housewives, Grey's Anatomy, Music Videos a la iTunes, etc....etc...

J. | Jan 25, 2007 | 4:37PM

You are on to something, but I think you are also off the mark in a few major ways. Google's plans are not unique - Yahoo!BB in Japan has been attempting a similar move for several years now. Secondly, BitTorrent and similar technologies do move a lot of traffic, but their volumes can be misleading owing to differences between how peering connections are measured and managed and paid-for internet service. In some ways, BitTorrent actually creates bandwidth, at the edge of the network, from resources that aren't being used efficiently today. Many predicted Yahoo!BB's dominance in Japan, and they do indeed have an incredible model, but their legacy business was far more profitable, which my guess will be the case for Google as well.

Everett | Jan 25, 2007 | 6:40PM

It seems to me that Google could use their fibre optic cables to link between a bunch of their shipping container data centers placed strategically (everywhere), deliver free WiFi access to 90% of US internet users, take over the market and really piss off some telephone and cable companies.

Cheap wins and it's hard to beat free! Google will pay for it from ad revenue, just as TV of yesteryear was financed by advertising.

802.11n has more range and throughput so a web of transceivers could be implemented to distribute the WiFi.

Mark King | Jan 25, 2007 | 7:00PM

To the first comment:

Didn't Google already buy out Youtube and Myspace?

Nick | Jan 25, 2007 | 9:31PM

Article about GOOG exploring use of powerline in conjunction with WIFI in SF area. Earthlink is GOOGs partner in SF and has done a lot of powerline development with TKO and ABTG.

Google's Powerline Play
01.25.07
discuss >

Google (Nasdaq: GOOG - message board) may rely on broadband over power line (BPL) technology to augment its Mountain View, Calif., WiFi network in the face of alleged interference problems, one analyst says.

Google outfitted Mountain View with free WiFi last year (See Mountain View Gets Free Access and Google Takes WiFi Plan to the 'Hood.) But interference with other WiFi networks is creating "security and containability issues," Global Equities Research analyst Trip Chowdhry writes in a report issued earlier this month.


So, apparently, it's BPL to the rescue.

"Contacts feel Google WiFi network interference can be solved when Google rolls out DS2-based, 200 Mbit/s powerline home networking technology," Chowdhry writes.

The company Chowdhry refers to -- Design of Systems on Silicon (DS2) , of Spain -- sells BPL gear, including dongles (the adapters that plug into the wall), based on Universal Powerline Association high speed powerline networking standards. (See Pirelli Uses DS2 for Powerline.)

So when might Google make a decision on the technology? "Probably within next 12 to 18 months," Chowdhry tells Light Reading.

Another source tells Light Reading that Google is in the "talking and exploring" phase with powerline home networking.

Google spokesman Brian O'Shaughnessy called any engagement with DS2 "rumor" and declined further comment.

In fact, Google isn't even admitting to the interference problem, despite several reports to the contrary from Mountain View users. (See WiFi Outlook Cloudy in Mountain View.) "You stated that users were having interference problems in their homes; I would take issue with that," O'Shaunessy says. "We haven't seen any evidence of that.

Google has shown an interest in BPL in the past. The company invested in the BPL vendor Current Communications Group LLC in July 2005. But Current doesn't make home networking gear; its technology is focused on helping electric utilities deliver broadband service over the public power grid. (See Current Comms Raises $130M.)

Google has a foot in home networking as well. In November 2006, it invested in the startup Meraki, which makes in-home wireless mesh routers intended to extend muni WiFi signal into apartment buildings and homes. (See Google Invests in Indoor Mesh.)

Chowdhry believes Google has spent between $1.2 million and $1.5 million on WiFi equipment for Mountain View. The city covers about 12 square miles and is home to around 72,000 people.

Mark Sullivan, Reporter, Light Reading


jc | Jan 26, 2007 | 8:53AM

Well, if google is really doing what Mr Cringely says, all Google is doing to the Internet is what MS did to the PC industry.

What is the value of your PC if can not run Windows?

What is the value of an ISP if it doesn't run Google???

Sanders | Jan 26, 2007 | 11:52AM

The first looser here isn't ISPs, but Akamai. If Akamai starts loosing business to Google, watch out.


Google is about infrastructure.


I would say that the reason why they are picking cheap sites has to do more with supporting the entire southeast and proximity to the closest NAP (still Georgia?), as well as proximity to reliable power. If they own dark fiber for their own use between their data centers, that avoids long-haul traffic thru backbone providers, their activitity to end-users become all short haul traffic (to the local data center). That's cheap access, and their long-haul data exchange is using their own infrastructure.




Cheap data logistics, lower prices, higher margin.


Dave

Dave | Jan 26, 2007 | 1:25PM

Re Sun

Don't get too excited over their latest move, it was just a way to keep other private equity firms which have been sniffing around from making a hostile move.

SJGMoney | Jan 26, 2007 | 2:10PM

Come on. Stop smoking whatever it is you smoke. The most apparent quality of Google is a complete lack of focus. They make all kinds of products that get abandoned 50% of the way from the finish line - picasa, google-web, google-video, froogle, google catalogues, etc. The list is endless.

Everything at google seems to ride on the coattails of their search engine brand and advertising business.

Unless they get their act together, look for 1/8th the stock price in a few years.

Manu | Jan 26, 2007 | 5:26PM

To Manu,
You are wrong, unlike Microsoft and other companies that keep their R&D behind closed doors, Google publishes almost everything(well I do not know how much).

Those projects are a testing ground and Google leaned that the best way to Q&A is to give it to the public.

Efi | Jan 27, 2007 | 5:42AM

To Manu,
You are wrong, unlike Microsoft and other companies that keep their R&D behind closed doors, Google publishes almost everything(well I do not know how much).

Those projects are a testing ground and Google leaned that the best way to Q&A is to give it to the public.

Efi | Jan 27, 2007 | 5:42AM

Well so much for "Don't be evil" - looks like Microsoft all over again!

While there may not be intended malice, such positioning certainly makes sense but if taken to its logical conclusion would have to end with a Bell style anti-trust scenario. I'm no lawyer, but you can't grab that much control and not end up without an effective monopoly.

Maybe I should become a lawyer, a Google anti-trust action would go on for years!!!!!!!!!!

Nrw | Jan 27, 2007 | 7:38AM

There is an amazing amount of ways to cache or otherwise optimize the delivery of redundant content.

There are only a few hundred DVDs, a few dozen shows on TV, and perhaps a few hundred CDs that represent the bulk of bandwidth worth caching or even sending over the internet. There is certainly a lot of other good content including video and news sites, but this is easily cached or transferred once across any major bottleneck (that the reason for caching data ... if you can get it just as quickly from the original source, you might as well let the original source maintain the infrastructure.)

Even if you want to cache 10,000 movies, the way less the 36 hours of original contect from all networks on a 365 day basis (13,140 hours), you only have 10k x 2 + 13 = 33,000 hours of video at good quality 33k x 2 gb = 66 TB = 660 1GB drives ... big, but even at overkill over storage is not that much of an investment for a company.

a single cross country fiber OC-192 (10 gb/s) are plentiful and cheap ... you can built a datacenter anyway. a

radradrad | Jan 28, 2007 | 10:40AM

Google is a very very smart company. It’s founders where born out of the new IT generation i.e. the NOT Microsoft generation of the 60’s
They have a far less traditional way of looking at business and you can be sure the way they are buying contracts as opposed to network is absolutely intentional to
prevent themselves ending up in a monopoly situation like microsoft.

The have fingers into massive amounts of infrastructure and technology but unlike MS where they buy companies and absorb into the empire and throw away the bits they don’t like – Google have a softer approach but no less opportunistic.

They clearly understand where the audio visual technology streams are going . .. the one thing I am surprised they haven’t jumped into is VOIP but then I would guess it is only a matter of time . . and once again an opportunity like they had with Youtube.com

The thing with Google is they clearly understand what other companies like like AOL, Telstra etc do not and that is that the internet is about content not bandwidth . . its about what we do or want to do on the internet rather than being the ability to do it. That is what Google’s products are all about controlling/providing the information flow, the content.

It puts an enormous amount of responsibility on the company, but also requires an enormous amount of trust from us.

Lets just hope they live up to their company motto “Do No Evil”

Ben Morrisson | Jan 28, 2007 | 9:42PM

Great article, but I think this points to something even more insidious or daring depending on if you're a fan of Google.

I can definitely see the need for more bandwidth, and it's a smart move on Google's part to start the data centers. But has anyone considered what else they can do with this bandwidth once the bottleneck is taken care of to the customer? PaulT touched on it in his article with renting 200GB of storage from Google and access "my computer" anywhere.

Google could potentially take over the desktop itself, by using thin client technology. With 40 users per server, this could easily be done. No longer will many users have to worry about backing up their data or doing OS installs. They can buy an even lower cost PC, because their is no need for a hard drive or a fire breathing CPU. The PC boots from flash loading some Google proprietary minimal OS for providing the remote desktop login to your Google data center.

It's a natural extension to what they're offering now. You can keep your email at Google. You can upload your pics and soon to be videos at Google. You can now do your documents and spreadsheets on Google! Does anyone detect a trend? Can we say, good bye Microsoft Windows?

It will now be up to Google to protect your data from viruses and hackers. But, the user no longer needs to worry about such problems which makes a great advertisement for the average user. You'll probably have to pay for this service too;-)

What about gaming? Who nows, maybe the futuristic Google PC will have a USB port that loads a game stored in a flash drive and connects through Google Internet for multi-player access. Or maybe the games will be subscribed through the Google internet service.

I can see a lot people flocking to this service for it's convenience and less hassles fighting irritating problems such as virus, spyware, backing up data, installing an new OS, etc.

J Atkinson | Jan 29, 2007 | 2:52PM

Eventhough google is a very handy tool for searching things it doesn't have the right to BE the internet because although majority of the people use it, not ALL has used it. Just ask the North Koreans!!!

Florie | Jan 29, 2007 | 3:15PM

internet saturated by video in 2007?...WASHINGTON, D.C. - A new assessment from Deloitte & Touche predicts that global traffic will exceed the Internet's capacity as soon as this year. Why? The rapid growth in the number of global Internet users, combined with the rise of online video services and the lack of investment in new infrastructure. If Deloitte's predictions are accurate, the traffic on many Internet backbones could slow to a crawl this year absent substantial new infrastructure investments and deployment.
Uncertainty over potential network neutrality requirements is one of the major factors delaying necessary network upgrades. The proponents of such regulations are back on the offensive, heartened by sympathetic new Democratic majorities and the concession made by AT&T (nyse: T - news - people ) in its BellSouth (nyse: BLS - news - people ) acquisition. The Google/MoveOn.org coalition fighting for network neutrality mandates calls itself "Save the Internet." But the Internet doesn't need to be saved--it needs to be improved, expanded and bulked up. An attempt to "save" the Internet in its current state would be something akin to saving the telegraph from the telephone.
Robert Kahn and David Farber, the technologists known respectively as the father and grandfather of the Internet, have both been highly critical of network neutrality mandates. In a recent speech, Kahn pointed out that to incentivize innovation, network operators must be allowed to develop new technologies within their own networks first, something that network neutrality mandates could prevent. Farber has urged Congress not to enact network neutrality mandates that would prevent significant improvements to the Internet.
Without enormous new investments to upgrade the Internet's infrastructure, download speeds could crawl to a standstill. It would be unfortunate if network neutrality proponents successfully saved the rapidly aging, straining Internet by freezing out the technological innovations and infrastructure investments that would enable next generation technologies to be developed and deployed.
The video-heavy, much vaunted Web 2.0 advances of the last couple of years were made possible at low prices to consumers because the speculative overbuilding during the bubble era created massive overcapacity that made bandwidth cheap and abundant. It's now all being consumed.
One solution suggested by network operators is to prioritize traffic based on service tiers and use revenue from content providers in the premium tiers to subsidize the high costs of infrastructure deployment. The MoveOn.org crowd denounces this solution for creating Internet fast lanes and relegating everything else to the slow lane. But as the Deloitte report shows, the likely alternative is that there will be only slow lanes, potentially very slow lanes as soon as later this year. Call it the information super traffic jam.
Advanced networks cost billions of dollars to deploy and need to generate predictable revenue to make business sense. The infrastructure companies are unanimous in their belief that offering premium services with guaranteed bandwidth will be necessary for them to justify their investments. Quality-of-service issues alone are likely to require tiering, because in a world of finite bandwidth, people won't want high-value services like video and voice if they can be degraded by the peer-to-peer applications of teenage neighbors.
Craig Moffett of Bernstein Research told the Senate Commerce Committee last year that any telecom company that made a major infrastructure investment under a network neutrality regime would see its stock nosedive. Moffett estimated that the bandwidth for an average TV viewer would cost carriers $112 per month. A high-definition TV viewer would cost $560. Unless the YouTubes and Joosts of the world are willing (and legally permitted) to pay some of those costs, the investments are unlikely to happen.
If network neutrality proponents have their way the Internet may be frozen in time, an information superhighway with Los Angeles-like traffic delays. The Internet doesnt need to be saved--it needs to keep getting better.
Phil Kerpen is policy director for Americans for Prosperity.

jc | Jan 31, 2007 | 9:55AM

I'm buying stock now and waiting for the big break up that is forced on them in 2015.

Broken into three divisions: backbone, online services (ad-sense etc) and entertainment division (the provider of all that great programming they bought up in 2012).

David B | Jan 31, 2007 | 1:23PM

This is my first time reading and commenting on this blog and I must agree with some of the other commenters that it's one of the best sites on the web. Congratulations Mr. Cringely.

However, I want to point out something that I think almost every commenter has missed. Before I get to that though I want to talk about the last mile question taht was raised.

If you use wireless the last mile is not as expensive as it looks. The Wimax forum models it at $10/home passed (that a mere $1B to cover the US). If we assume much higher bandwidths then we need to increas that number. I am going take a very conservative guess and say that's 50X the original prediction and at $500/home passed. Amortized over 10 years that's abuot $50/home passed. Each person in America gets about $1000 worth of advertising thrown at them per year and if you assume over time $300 of it is online you can easily see that the cost of Google building the entire network all the way to the home is well within reach. I wrote about this more than a year ago here::
http://baris.typepad.com/venture_capitalist/2005/11/sbcs_1_competit.html

Now to the main point I want to make. I think most of us commenting are techies and we've missed the one big thing that Google doesn't control and that's men with guns.

That's right, Google doesn't control the politians, the elected officials and it's they who rule the world. If it can be campaigned that Google's data centers represent a monopoly to the other search engines who don't have access to it, then they will be split.

Sooner, some politician somewhere will say "I want some of the money Google is making, give it back to my constituency." If Google disagrees, they will show up at the door with people with guns and tell the Google person, "pull the plug or I will harm you physically". That's where they'll hit the wall. There are a lot of powerful people watching Google make money and they will want their cut. This is how the world works. If you look at it from high enough, that's what's happening in the middle east.

So if any one of you can convince me that they can rise above those who hold power and enforce it with force, then I am prepared to put my entire net worth in Google stock, becaue I agree with everthing else Robert says, and Google is that good.

Baris Karadogan | Feb 01, 2007 | 12:53AM

Hi,

This is the first time I am reading your article. Its really interesting. Good thought!

Sadiq

sadiq | Feb 01, 2007 | 7:05AM

Fist of all, Congratulation to Mr Cringely for this excellent article.

@Baris :

Indeed Google does not play much in the politician field... yet. Over the past year it have been hiring more and more lobbyist and this will keep going on.

To see what may happen about trust issues, let have a look at Microsoft. We have an obvious monopoly, but a lot of money on the other side... what are the result, Microsoft is still one and powerful...

Google is very rich, so data center is a good way to spend the money, Microsoft is certainly also thniking at these kind of evolution and won't let the Mountain View guys ride alone. We can expect a top level fight for content providing and backbone peering...

Check this article for my last year insight about this matter

Alex | Feb 01, 2007 | 2:23PM

I liked this article but it was a little too intense for my taste. Remember that when Google came along there were many search engines which it toppled, based on superior technology. All that Microsoft has to do is come up with search technology that is roughly comparable to Google's, and they will easily be able to compete. As Google's CEO is wise to recognize, they are only one click away from losing most of their user base.

matt@mit | Feb 02, 2007 | 4:16PM