Google Fiber was a great idea while it lasted. But the search giant now is laying off staff as it says, in a blog post, that it will “pause” its effort to add 10 cities to the eight that have the super-fast broadband service and four where it’s committed to proceed.
Craig Barratt, who’s CEO of Access — the unit that includes Google Fiber — says that “this is the right juncture to step aside from my CEO role.” Larry Page, CEO of Google parent Alphabet, “has asked me to continue as an advisor, so I’ll still be around.”
He attributes the shift to Google’s focus on “new technology and deployment methods to make superfast Internet more abundant than it is today.”
The company’s expected to build wireless internet services. Early this month it closed a deal to buy Webpass, which uses point-to-point wireless technology to offer speeds of up to 1 gigabit per second to customers in Boston, Miami, Chicago, San Diego, and San Francisco.
Barratt says that he’s “grateful” to cities that sought Google Fiber “for their ongoing partnership and patience” adding that he’s “confident we’ll have an opportunity to resume our partnership discussions once we’ve advanced our technologies and solutions.”
Still, in those cities “we’ll be reducing our employee base.”
Google Fiber was seen as a potential threat to cable companies in 2012 when it was introduced in Kansas City. But at the end of June it had just 68,715 video customers nationwide according to U.S. Copyright Office data compiled by MoffettNathanson Research.
“If this shockingly low video attach rate is correct, then Google’s economics must have been even worse than we had imagined… which helps explain why Google’s senior management apparently became disillusioned with the strategy so quickly,” the Wall Street firm says. “Without more support from video, even with its lower margins, broadband was largely left alone to support the economics of deployment. That was never going to work.”