On the internet's new frontier

Google’s high-speed fibre broadband project in Kansas is charting new territory for the internet

Matthew Marcus is sitting among other technology entrepreneurs in his house in Kansas City, not far from the KansasMissouri state border that splits the city.

He inherited the property from his late mother, an antiques dealer, and since September has converted it into the head office of Kansas City Start-up Village for new technologies businesses.

Five doors up is the “Home for Hackers”, filled with internet entrepreneurs drawn to this hub of innovation and entrepreneurship. This new enterprise, which is just 130 days old, was going before Google Fiber, the internet giant’s start-up, made superfast internet available in the city from last autumn.

Long dismissed as a flyover state, Kansas City is getting more connected to the rest of the United States thanks to Google. It is the first US city wired for high-speed internet to homes.

Blowing rivals away

The company offers a one-gigabyte-per-second internet service, which is 100 times faster than the typical broadband connection in the US. The price is just $70 a month, blowing rivals away. Time Warner Cable offers broadband for about $5 more a month but at a tenth of Google’s speed.

Google’s service allow users watch four long YouTube videos at the same time without the downloader staring blankly at the screen waiting for the buffering to end.

In Kansas, Google is laying down a fibre optic network, the 21st century equivalent of railroad lines, and the start-up entrepreneurs are moving in like pioneers to use the new technology.

“This is the new frontier. It is ironic that we call it the Kansas City Start-up Village, the new western frontier for the new gold rush,” said Marcus, who runs Local Ruckus, an information website for local events, from Hanover Heights, the first of two so-called fibrehoods in Kansas City.

“We recognise we are at the forefront. If you are the first ones here you have a chance to capitalise. We laugh when we hear Kansas described as a flyover city or cow-town – we are changing that perspective.”

Kansas City was chosen by Google from about 1,600 applicants to be the first city to be wired for the company’s high-speed internet. The company was attracted to the city because of its position in the middle of the US, good demographics and colleges, its culture of entrepreneurs and its low cost and high quality of living.

The company will not disclose what it is investing in wiring the city. It plans to roll out the high-speed service to 178 more neighbourhoods across the bi-state city.

Chief financial officer Patrick Pichette said earlier this month on a results conference call that Google Fiber was “not a hobby” for the company and that it planned to invest similarly elsewhere.

Google sees the Kansas project as a step change in internet technology, while those entrepreneurs who are using it see it as a giant leap forward, much like when broadband replaced dial-up modems.

Marcus, who is co-leader of the start-up village, compares Google’s nuts-and-bolts investment in Kansas to the move from by-hand card-dealing in Las Vegas to the electronic shuffler – ultimately it generates consumption by customers.

“Why is Google providing this speed? They benefit by pushing the envelope because the current internet service providers have been sitting on their laurels.”

Setting the bar high

By setting the bar this high, Google is attracting new companies looking to see what they can develop with the technology. Twenty businesses have committed to setting up in the village; and four have already been set up, funded by investors.

Mike Burke, chairman of the Kansas mayor’s innovation team for Missouri and Kansas, said that even before a computer was turned on the publicity surrounding Google Fiber being road-tested in Kansas as was a “huge energiser” for technology start-ups in the city.

Being the first American city wired for high-speed has opened up opportunities for many different industries in the area and attracted businesses looking to learn more, he said.

One company visiting is Dopool from China, whose products enable people to watch television on smartphones. With 80 million users, the firm is adding new ones at a rate of about five million a month.

“Google Fiber is like Gmail – that eventually became so popular,” said its chief executive, Bruce Chen, who is looking to expand and seems to be weighing Kansas for a research and development centre.

Nick Budidharma, an 18-year-old developer, moved to the Home for Hackers from South Carolina to get the bandwidth he needs to run his games server provider, LeetNode, at an affordable price. He hosts Fiber Fridays, a weekly event where he shows off what the superfast broadband connection can do.

“This opens up opportunities as to what we can do,” he said.

Phil Jaycox describes himself as the “first unofficial fibre tourist”, having moved from nearby St Louis to set up shop in the Home for Hackers. There he runs Dealivr, which helps small businesses deliver products.

“I have made a lot of progress here. Google Fiber definitely increases productivity,” he said. “I am mostly here for the people that Google has brought here. I like it because I can bounce ideas off other start-ups – creativity creates creativity.”