Fiber optic internet is too costly.
Google parent company Alphabet is shaking things up at its gigabit internet division, according to a report today from The Information. The unit, previously known as Google Fiber and now called Access, is shifting its focus to wireless technology, and not ultra-fast internet delivered through fiber-optic cables. More pressing, however, is a demand issued by Alphabet CEO Larry Page to reduce customer acquisition costs to one tenth their current level while asking Fiber chief Craig Barratt to cut the unit’s workforce in half, from 1,000 people to 500.
The changes represent a rift at Alphabet over how it handles what were once Google’s most ambitious projects. Some of these ideas, like the self-driving car project, have commanded immense resource investment because they represent the company’s grandest ideas for the future. Yet Page and co-founder Sergey Brin spun out some of those projects from Google itself when it restructured as Alphabet last August, including Fiber, anti-aging biotech division Calico, and smart appliance maker Nest.
The restructuring has created a heightened focus on those units and how much money they’re spending on the long road to profitability. Read more….
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