Google to Buy Provo's $39 Million Fiber Network for $1 for Google Fiber Expansion

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News Posted: Fri, Apr 19 2013 1:45 PM
Earlier this week, Google suddenly and unexpectedly announced that it was planning to roll out Google Fiber service to Provo, Utah. The city has an existing (though older, and somewhat unfinished) fiber-optic network that Google can apparently just retrofit to suit Google Fiber, which is a much cheaper strategy than building a gigabit infrastructure from scratch.

According to the AP, the fiber network initially cost the city $39 million, but it may sell it to Google for one dollar. The smallish city’s residents have been paying $5.35 per month per household in utility bills for about a decade to pay for the network, and the city will keep paying on its construction loan for the project for another 12 years.

Provo

The Google takeover sounds like a somewhat risky venture for Provo. On the one hand, Google is all but guaranteed to make Google fiber work in the city, and Provoians will get that sweet free Internet for 7 years deal, which would save everyone in town money. Further, there’s reportedly the potential for Google to build out a public free WiFi network, too.

There are also huge side benefits; the mere presence of Google Fiber will entice people to buy homes in town and encourage businesses to set up shop. It also puts Provo on the national radar in a sense, because everyone who discusses or thinks about Google Fiber will include Provo in the conversation--and let’s be honest, the last time most of us thought about Provo, Utah was, well, never.

On the other hand, if things don’t pan out with Google for some reason, the search giant has a clause where it can sell the network back to the city (also for the price tag of $1), so in a few years, Provo could be right back where it started--with an aging fiber optic network that it can’t afford to run or repair.

The Provo city council has to make a decision on Tuesday. We have an inkling that it will lean towards bringing in Google.
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realneil replied on Fri, Apr 19 2013 8:29 PM

Good deal for Google and they get to expand on their fiber reach.

It's a win/win all around.

Provo is a really famous place, just ask Donnie & Marie,............

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I really hope they vote yes for it. We are in desperate need of better internet options around here

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Uhm, is this city council going to be making a smart choice? Doesnt like any council I have ever heard of.

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Clixxer replied on Mon, Apr 22 2013 1:15 AM

Any city counsel would be crazy at this point to turn down Google unless something is unreasonable but Google makes it to easy. City counsels aren't smart but I assume if they want to get reelected they wouldn't turn down on the hottest things in America right now.

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sevags replied on Thu, Apr 25 2013 1:02 PM

I wrote out a long response the other day but for some reson it didn't post and I was too lazy to type it again.

I really don't believe that Provo would be in the same place if google decided to hand them back the infrastructure, this sounds like a win-win for Provo. If google succeeds then Provo will have gotten a jump start on the rest of the country making the current budget overrun more than worth it for the overall service they would be receiving. If google fails and decides to sell back the service for $1 it would mean that Provo got a relief from having to make any payments for however amount of years google was owner of it and then they would be handed back a massively upgraded network for the low low price of $1. Either Provo gets a working service with no further spending by the city or they get a payment break and an updated infrastructure for a low low price.

Sounds like a huge win for Provo while google takes all of the risk, quite smart.

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