Google Fiber pauses Chicago operations
Tech giant suspends plans to bring fiber optics to Windy City in favor of a wireless approach.
Google Fiber, a subdivision of Google Access, announced a pause to its fiber optic installation project in Chicago Oct. 25. The pause is part of plans to cut staff 9 percent across the country in order to rethink and reorganize its efforts to bring high-speed internet to the largest cities of America, according to Ars Technica.
The scale-down comes at the advice of Larry Page, the CEO of Alphabet, Google Access’ parent company. Page gave Craig Barratt, Google Access CEO, the recommendations to cut back on expenses in an August meeting over the future of Alphabet’s internet installation plans, The Information reports. In addition to the staff reduction, Barratt will also step down as CEO, but stay on as an adviser.
Google Fiber embarked on its fiber optic quest five years ago when it announced it would bring high-speed internet to Kansas City, Mo. The project was largely a success, creating several “fiberhoods” in Kansas City and the surrounding suburbs. Since the initial success in the City of Fountains, Google Fiber set an ambitious goal of building the fiber-optic groundwork in several cities and the possibility of building in places Google Fiber has deemed “potential cities.”
Chicago was one such “potential city.”
Barratt explained Google Fiber’s future in these “potential cities” in a lengthy blog post:
“In terms of our existing footprint, in the cities where we’ve launched or are under construction, our work will continue. For most of our ‘potential Fiber cities’ — those where we’ve been in exploratory discussions — we’re going to pause our operations and offices while we refine our approaches. We’re ever grateful to these cities for their ongoing partnership and patience, and we’re confident we’ll have an opportunity to resume our partnership discussions once we’ve advanced our technologies and solutions. In this handful of cities that are still in an exploratory stage, and in certain related areas of our supporting operations, we’ll be reducing our employee base.”
Chicago has been bumped from the list of potentials and moved to the category of “Webpass Cities.” The name refers to a wireless internet service provider called Webpass, which Google Fiber acquired in October. Chicago, along with San Francisco and San Diego, will not have fiber optic installation, but may still have high-speed internet. The main difference is the lack of actual fiber optic installation in favor of a wireless approach which may save Google Access millions of dollars in construction costs.
So while Chicago may miss a much-wanted influx of cash in construction around the city, Chicagoans’ hopes for Alphabet-provided high-speed internet may still be viable. However, the tradeoff will come at a cost: The wireless approach will provide fiber optic-like internet speed for multi-residential apartment buildings and businesses, but may not be cost effective for single-family, suburban homes, Ars Technica reports.
This internet installation would be a boon for Chicago, which is quickly becoming one of America’s leading tech-hubs. However, the city’s underlying problems still cast a dark shadow over the prospects of future investment from tech companies. With rising property taxes, water taxes, employee compensation costs and no real attempts at reform, Chicago has put itself at a competitive disadvantage with other cities. The need for pro-growth reforms is more imperative than ever, especially with companies like Alphabet watching.