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Will Google's Broadband = Win for Google?

Is Google's broadband experiment an example of the search-engine company overreaching -- or a shrewd means to Google's own ends?
Author:

NEW YORK (

TheStreet

) -- Last week, when

Google

(GOOG) - Get Report

announced in a blog post that it would begin a broadband experiment involving building and testing ultra-high speed broadband networks in select locations across the United States, the impact was notable.

"We've urged the FCC (Federal Communications Commission) to look at new and creative ways to get there in its National Broadband Plan -- and today we're announcing an experiment of our own," the company said. The FCC chairman, Julius Genachowski, has expressed a favorable view of the experiment.

Google said it would be delivering Internet speeds more than 100 times faster than what most Americans currently have access to: that's 1 gigabit per second. The price at which the service will be offered will be "competitive," according to Google. The company envisions that the service will reach at least 50,000 people and perhaps up to 500,000 people.

Google is currently trying to identify communities that are interested in the service by using YouTube video to ask for potential communities to voice their interest. "We want to see what developers and users can do with ultra high-speeds, whether it's creating new bandwidth-intensive 'killer apps' and services, or other uses we can't yet imagine," the company says. Google says that it will give users the choice of multiple service providers.

Google's dabbling in the broadband industry comes shortly after the company brought its own Android-based smart phone to the market -- the Nexus One. However, many customers have complained about the company's poor customer service with regards to the Nexus One and now Google has finally set up a customer support line to answer some of their burning questions.

Given that its core search engine and advertising business is based on software, Google has limited experience managing hardware ventures such as the Nexus One and the newly announced broadband networks. Perhaps the Nexus One issues and customer complaints will be good practice for Google for when it begins offering its broadband services.

The

Associated Press

recently reported that Google has reduced its early termination fee for the Nexus One phone to $150 from $350. However, those customers would still have to pay an early termination fee of $200 to

Deutsche Telekom's

(DT) - Get Report

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T-Mobile USA, a network on which Nexus One runs, according to the report.

This comes as the FCC is looking into why customers who use the Nexus One with T-Mobile have to pay both companies fees in order to end a contract early, according to the report. Google's early termination fee almost doubles the T-Mobile USA early terminations fee that the customers would have to pay.

And while Google's broadband experiment is being viewed favorably by some as a means of achieving freer, fairer and better high-speed Internet access, the investment has an element of self-interest to it as well. If the company unleashes a higher standard of high-speed Internet access that pressures big Internet service providers to follow suit, that only makes it easier for all to access Google's search engine faster and more frequently.

Given that Google derives much of its revenue from search engine-based ad sales, accelerating the speed at which individuals tap into the search engine would only benefit Google in the long-run.

In light of all this, we ask you, the readers of

TheStreet

: Do you consider Google's broadband experiment to be a means to a fruitful end? Take the poll below to learn the consensus of

TheStreet.

The comments box is also below, should you feel so inclined to sound off on the whole thing.

-- Reported by Andrea Tse in New York

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