Google’s Wireless Internet Service Still Expanding
Webpass, the hybrid wireless broadband service owned by Google, expanded into Seattle, the company’s seventh market, with its $60-a-month, no-contract online offering.
But unlike larger Internet providers which wire up connections across whole neighborhoods at a time, Webpass won’t be offering service immediately to many potential customers.
The company’s technology uses mostly wireless links to reach large apartment buildings or businesses and then wired cabling inside the structures to connect to individual customers. That means it can start offering service with a minimal up-front investment, but also limits its ability to grow large quickly.
In Seattle, so far, it has connected only one building: a 40-story luxury apartment tower near the famous Pike Place Market.
“We go where the sales take us,” CEO and founder Charles Barr tells Fortune. “When you look at our network, it’s not a network that you would see in a network design manual because we follow the business. The pace of expansion really depends on how quickly we attract customers and how quickly we attract new buildings.”
Building owners often have exclusive deals with larger telecom providers, so cracking the big buildings in a new city is a slow process. Webpass’s current focus is on buildings with at least 10 units that already have ethernet cabling throughout. “That’s our sweet spot,” Barr says. “Most of those are in urban cores.”
Webpass, which was acquired by Google Fiber a year ago, will be adding new cities at a more rapid pace in the future, Barr said, but he declined to give more details. “Our marching orders are to grow as fast as we can,” Barr says, revealing only that he plans to enter more than one city per year going forward.
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The controlled pace of expansion may be a lesson learned from the many pioneers who tried to use the wireless/wired Internet strategy and ended up in bankruptcy. Providers like Winstar Communications and Teligent, along with many others trying to crack the local phone company monopolies, went under almost two decades ago after a consuming some $250 billion in capital. Webpass was founded in 2003, just after the earlier telecom bubble had popped.
The expansion plans come even as holding company Alphabet’s (GOOGL) larger Google Fiber unit has struggled. Fiber laid off employees last year and curtailed growth plans after attracting fewer customers and expending greater resources than initially planned.
Fiber is looking into a wireless form of service that would not rely on any cables at a customer’s home, like Webpass. Rather, Fiber would beam Internet connections directly to homes over the air to a customer with a wireless router installed. Google recently got permission from the Federal Communications Commission to test such a technology at Nascar races this summer.
But Webpass operates separately from Google Fiber’s more traditional approach, Barr says. The fiber unit typically runs cables to neighborhoods and offers Internet service to any home in the area. “Google Fiber is our partner but we don’t necessarily coordinate business objectives or coordinate strategy,” he says. “We operate very autonomously and very independently.”