Google would be the first to admit that its fantabulous new high-speed Internet in Kansas City is more of an experiment than a for-profit business.That said, in its first week, the service has already signed up 7,000, of 4% of potential households, say the analysts at Macquarie Capital in a research note.
That means 7,000 houses out of a possible 165,000-ish have paid the $10 pre-registration fee.
You can’t just call Google and get a new account like you can with other ISPs. Google hasn’t rolled out the high speed network to Kansas City neighborhoods yet. It has divided the city into districts it calls Fiberhoods. It asked each Fiberhood gather up lots of interested households and apply. If the area gets enough, Google fibre will come to them.
But even if Google can swoop in and nab 25 per cent of Kansas City households, Macquarie estimates that Google will be operating Google fibre at a loss for some time.
25 per cent paying an average of $100/month would generate $50 million a year. “We expect this initial rollout to be net negative for GOOG. It reminds us that this initiative is less about a long-term revenue opportunity for Google and more about pushing current Internet providers to increase speeds and innovate (which could benefit Google in the long run),” the analysts wrote.
Still Google is giving signs that Google fibre will NOT be a one-city wonder. Google wants to bring it to more cities some day.