Google Fiber's (Nasdaq: GOOG) expansion into Provo, Utah and Austin, Texas, along with its ongoing efforts in Kansas City, has caused some market analysts to reconsider how the 1 Gbps service will play out in the long term.
The new theory, a Forbes article said, is that Google will now go full-steam ahead in building out a national fiber network to feed its 1 Gbps service.
Evercore Partners, for instance, predicts that Google could attract as many as 3 million customers in the next seven years, according to Forbes. Evercore analyst Ken Sena said that building out Google's network to reach 8 million homes would cost the deep-pocketed firm about $7 billion.
That's less than what Jason Armstrong of Goldman Sachs predicts. His figures show that Google could spend about $1.25 billion a year to reach 7.5 million homes in nine years. That would make the final bill about $10 billion.
In almost every case, the analysts now see the as a viable business, with Sena noting that "Done selectively, Google Fiber has the potential to deliver a modest standalone return in addition to providing positive benefits to Google's broader business in promoting faster industry speeds and accessibility."
Also noting a new trend, BTIG analyst Richard Greenfield told the publication that Google Fiber is now "far more than a science experiment" and cited a research note to expand on Google's wider reaching goals.
"Faster speeds enable Google to innovate faster and make new and better products that can leverage faster broadband speeds," he wrote.
Not everyone believes that Google will ever be more than a way to drive service providers to higher broadband speeds and more TV services.
Last month, IHS Screen Digest released a report suggesting that Google Fiber would be offered "only in smaller markets" and that these represent "only about 0.4 percent of U.S. households."
The report's author, Dexter Thiellien, an IHS senior analyst, called Google's plans "miniscule compared to what its competitors undertake in the overall market," an IHS press release stated.
For more:
- Forbes has this story
- and IHS Screen Digest has this press release
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