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Should the FCC encourage waste of capital?

Posted March 7th, 2013 in Broadband, FCC, Google, Government Regulation and tagged , , , by Alton Drew

I like this quote from Todd Spangler who commented yesterday in a blog post about Google one gigabit per second initiative in Kansas City:

“ISPs that serve a large and diverse customer base — over large service areas — must weigh the network investment required to deliver 1 Gig with the return they’re going to get. Getting to market too soon is a poor use of capital: Chest-thumping, high-fives and happy headlines don’t pay the bills.”

The take away from Mr Spangler’s blog post is it’s too early for one gigabit per second speed in the vast majority of American households unless, as he points out, you have 300 Netflix accounts running at the same time. Most Ameircans would have to invest today in the hardware to address that type of speed.

What I do appreciate about Google’s efforts is that as a major content provider it is investing in getting American households to adopt broadband. Granted, its initiative is not for altruistic reasons; Google wants you to come to its site to search, hangout, and watch videos so like any good land developer, Google is going to make sure that it builds the roads necessary for you to come and visit it.

The FCC should take heed in how it promotes the flow of capital. Going around calling for gigabit communities shows some vision but the vision should be tempered by the actual needs today of the consumer.