Skip to main content

Big budget cuts ordered for Google Fiber, likely putting the brakes on rollout

google fiber louisville hybrid launch googlefiber 01
Image used with permission by copyright holder
Google’s ambitious fiber broadband plans have cost the company quite a bit of money, and were said to be worth the cost as recently as this year. Reality might be a different story altogether, as it now appears Google Fiber is the target of some substantial budget cuts.

A report in The Information claims Alphabet chiefs Larry Page and Sergey Brin have ordered huge cuts to the operating expenses of Fiber. Half of Google Fiber’s 1,000 employees stand to lose their jobs, and it might mean the postponement and possible cancellation of any future projects until questions on how to complete the rollout in a cost-effective manner are answered. Alphabet is Google’s parent company.

The problem lies in the sheer cost of building out these fiber-optic networks. An earlier story by Recode suggested that the rollout in Kansas City — the first city to be wired by Google five years ago — cost Alphabet some $1 billion to complete, and future rollouts will likely cost far more.

As a result of the substantial cost, Fiber has the daunting task of trying to attract enough customers to offset those expenses. Google execs in 2011 — in the days before the Kansas City network was switched on — bragged about customer numbers of five million within a few years in networks coast to coast, but actual results have been nowhere close to that.

Fiber is now in seven markets — Salt Lake City being the most recent — with five other installations expected to go online in the coming months. However, sources tell The Information that actual subscriber numbers are nowhere near the company’s original projections.

A Wall Street Journal story earlier this month also suggests that Google isn’t sure its current strategy of fiber-to-the-home is the right one, and may use wireless technologies instead to accelerate its rollout. Using wireless would cost Alphabet a fifth of what it costs for a fiber rollout, although Page apparently wants it to cost half that.

The result of Fiber’s apparent struggles seem to also be causing some disagreement among Alphabet’s top brass. While Page seems to be serious on getting costs under control, Google and Alphabet Chief Financial Officer Ruth Porat has apparently stepped in to argue that the costs are justified, The Information reports.

Confusion over what the future of Fiber might be could also be why its CEO Craig Barratt apparently considered leaving the company earlier in the year, and might further imperil future rollouts amid leadership questions if Barratt would end up leaving the company..

Representatives for Fiber have declined to report on the rumors.

Editors' Recommendations

Ed Oswald
For fifteen years, Ed has written about the latest and greatest in gadgets and technology trends. At Digital Trends, he's…
Qualcomm wants to add these crazy AI tools to your Android phone
Qualcomm Snapdragon 8 Gen 3 media asset.

At Mobile World Congress 2024, Qualcomm is adding more to its portfolio of AI-on-phone tricks facilitated by the Snapdragon series silicon for Android phones.  The chipmaker has already showcased some impressive AI capabilities for the Snapdragon 8 Gen 3 flagship, such as voice-activated media editing, on-device image generation using Stable Diffusion, and a smarter virtual assistant built atop large language models from the likes of Meta.

Today, the company is adding more grunt to those AI superpowers. The first is the ability to run a Large Language and Vision Assistant (LLaVa) on a smartphone. Think of it as a chatbot like ChatGPT that has been granted Google Lens abilities. As such, Qualcomm’s solution can not only accept text input, but also process images.

Read more
Your next phone could get a huge 5G upgrade, thanks to AI
Qualcomm Snapdragon X80 Modem-RF chip.

It’s that time of year again when Qualcomm ushers in its next generation of 5G modem technology. Announced at Mobile World Congress (MWC ) 2024, this year’s Snapdragon X80 5G Modem-RF system is the successor to last year’s Snapdragon X75, and it builds on the 5G Advanced foundation laid last year with more raw power and new AI features.

While the Snapdragon X75 moved the needle by adding support for the latest 5G Advanced standards, we’re still in that fourth phase of 5G technology, otherwise known as 3GPP Release 18 — and most carrier networks are still catching up. So, with no new standards to embrace, Qualcomm has focused on improving the inside of the Snapdragon X80 to take even fuller advantage of these cutting-edge 5G technologies.
The magic of AI-powered 5G

Read more
Google just announced 8 big Android updates. Here’s what’s new
A photo of many Android figurines on a white wall.

At Moblie World Congress (MWC ) 2024, Google is bringing a healthy bunch of new features to Android. In line with the AI push all across the industry, some notable AI-driven enhancements are on the table. There are also a handful of core Android features that sound practically amazing.
The first in line is Gemini. The generative AI chatbot recently got a standalone app for Android, and now it’s headed for the Google Messages app. Users can chat with Gemini directly in the messaging app and use its generative capabilities for a host of things, like drafting replies, refining a message, and more.

Another feature that was showcased a while ago is finally ready for prime time. Android Auto is gaining support for message summarization for standalone texts and group chats, and it can also suggest replies. With a single tap, users will also be able to drop a message, start a call, and share an estimated arrival time. The idea is to deploy AI for crucial tasks so that it can minimize distractions while driving.
Lookout, an accessibility-centric feature for users with vision challenges, is also getting meaningful AI love. On Android phones, Lookout will now read AI-generated captions and descriptions for media content. For now, the AI boost to Lookout and Messages is limited to the English language.

Read more