About two months ago, I found myself in a Provo, Utah, mini-mall. Don't ask. Anyway, there among the fusion sushi joints, oxygen bars and anti-UV T-shirt shops was a store I'd never seen before: a Google retail outlet.
Being the asteroid mining operation this company is these days, it should come as no surprise that this was a shop like no other. Nothing appeared to be actually for sale. There was little real foot traffic. In fact, nobody stopped in over the two hours or so I lurked about. From what I saw, the store appeared to be nothing more or less than a living showroom -- a kind of a giant diorama where customers could stroll in to see, feel and touch Google's latest flagship fiber-to-the-home Internet access service, Google Fiber.
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Google, I have to say, turns out to be not a bad little retailer. The display of just how cool TV, digital video recording, cloud storage and, of course, the Internet would be when it all runs at 1,000 megabits per second was way cool. And what's not to love about the prices? Free, Internet-only plans, were, uh ... free. And full gigabit + TV access ran just $120 per month. That's about $80 less than my average combined Cablevision and Verizon FIOS bill here in Westchester County.
Thing is, the more I poked around Provo, the more it became clear that Google is not being shy about pushing into the cable TV biz. There were repair trucks and a downtown customer service center and even marketing and promotion in local publications. All of which made perfect business sense, since Provo, along with Austin, Texas, and Kansas City, Mo., is an early test market for Google to work out the kinks of offering direct fiber-optic access to the Web.
But that business logic quickly zoomed down that fiber-paved road to hell as I starting asking the obvious investor questions: What on earth will the cost of all this retail, hardware and marketing imply for the fortunes of this now mostly virtual $52 billion Internet company?
Amazingly enough, the answer seems to be: Nobody cares.
An un-tied fiber logic
What's most surreal about spending months sifting through Google's fiber-optic ambitions is not that its spokespeople declined to comment. That I expected. Or even that customer service representatives, both in the retail store and online, had almost no idea about the details of the service they were trying to tell.
What's flat-out bizarre is how little of the financial implications of offering fiber-optic service on real scale is discussed in Google's financial statements. I may have missed something, so by all means, confirm for yourself. But when I read and then searched the company's 2013 10-K annual statements for references to Google Fiber -- or even fiber-optics at all -- I could not find a single mention.