By Om Malik, August 12, 2005

http://www.business2.com/b2/web/articles/0,17863,1093558-1,00.html

What if Google (GOOG) wanted to give Wi-Fi access to everyone in America? And what if it had technology capable of targeting advertising to a user’s precise location? The gatekeeper of the world’s information could become one of the globe’s biggest Internet providers and one of its most powerful ad sellers, basically supplanting telecoms in one fell swoop. Sounds crazy, but how might Google go about it?

First it would build a national broadband network -- let`s call it the GoogleNet -- massive enough to rival even the country`s biggest Internet service providers. Business 2.0 has learned from telecom insiders that Google is already building such a network, though ostensibly for many reasons. For the past year, it has quietly been shopping for miles and miles of ``dark,`` or unused, fiber-optic cable across the country from wholesalers such as New York’s AboveNet. It`s also acquiring superfast connections from Cogent Communications and WilTel, among others, between East Coast cities including Atlanta, Miami, and New York. Such large-scale purchases are unprecedented for an Internet company, but Google`s timing is impeccable. The rash of telecom bankruptcies has freed up a ton of bargain-priced capacity, which Google needs as it prepares to unleash a flood of new, bandwidth-hungry applications. These offerings could include everything from a digital-video database to on-demand television programming.

An even more compelling reason for Google to build its own network is that it could save the company millions of dollars a month. Here`s why: Every time a user performs a search on Google, the data is transmitted over a network owned by an ISP -- say, Comcast (CMCSK) -- which links up with Google`s servers via a wholesaler like AboveNet. When AboveNet bridges that gap between Google and Comcast, Google has to pay as much as $60 per megabit in IP transit fees. As Google adds bandwidth-intensive services, those costs will increase. Big networks owned by the likes of AT&T (T) get around transit fees by striking ``peering`` arrangements, in which the networks swap traffic and no money is exchanged. By cutting out middlemen like AboveNet, Google could share traffic directly with ISPs to avoid fees.

So once the GoogleNet is built, how would consumers connect for free access? One of the cheapest ways would be for Google to blanket major cities with Wi-Fi, and evidence gathered by Business 2.0 suggests that the company may be trying to do just that. In April it launched a Google-sponsored Wi-Fi hotspot in San Francisco’s Union Square shopping district, built by a local startup called Feeva. Feeva is reportedly readying more free hotspots in California, Florida, New York, and Washington, and it`s possible that Google may be involved. Feeva CEO Nitin Shah confirms that the company is working with Google but won`t discuss details. Google’s interest in Feeva likely stems from the startup`s proprietary technology, which can determine the location of every Wi-Fi user and would allow Google to serve up advertising and maps based on real-time data.

What Google Has on Deck

A sample of the high-bandwidth applications in need of the GoogleNet.

Service

Status

Purpose

Print

Beta

Lets readers peruse and search the entire contents of public-domain books on the Web.

Earth

PC-only download

Uses satellite photos to explore landmarks and present geographic information at street-level views.

Video

Search

Beta

Searches archived television content ranging from sports to documentaries to news shows.

Music

Rumored

Might troll podcasts and other audio files so they`d show up in search results.

TV

Rumored

Could let users share personal videos with friends and watch on-demand television programming.

Talk

Speculated

Would use VOIP technology to dial phone numbers that appear in local search results.

Sources: Google; Industry insiders

So is Google about to offer free Net access to everyone? Characteristically, the company is cryptic about its goal. ``We are sponsoring [Feeva] because [it is] trying to make free Wi-Fi available in San Francisco, and this matches Google’s goal to organize the world’s information and make it universally accessible,`` says Google spokesman Nate Taylor. ``We don`t have anything to add at this point about future plans.`` To which we speculate: Today San Francisco, tomorrow the world.