By Shanlini Ramachandran, Wall Street Journal
Bright House Networks, part of the Newhouse family’s media empire, said it will build an ultrafast gigabit broadband network in Tampa, Fla., the first time a cable operator has committed to match the speed being offered by Google Inc. ‘s fiber network to customers’ homes.
Bright House, which serves 2.4 million subscribers in Florida, California, Indiana, Alabama and Michigan, has agreed to build the gigabit fibertothehome network to 6,000 homes in Tampa communities planned by Florida realestate developer Metro Development Group. MDG said the first homes wired for the onegigabitpersecond service will be available for occupation this summer, with the entire buildout completed in about three years.
Aside from Bright House, the Newhouse family owns magazine and newspaper publisher Advance Publications as well as a big interest in Discovery Communications Inc.
The announcement comes just weeks after Google said it was considering expanding its gigabit fiber service to 34 cities in nine metropolitan areas across the country, up from two cities where it currently offers service. None of those cities are in areas served by the cable operator. But Google’s plans have fueled a debate across the country about the need for faster Internet speeds. The fastest residential broadband speed now offered by a U.S. cable operator is 505 megabits a second, although most customers subscribe to far slower speeds. “Google Fiber lit the fire and other companies are now stepping up, including Bright House,” said Tom Reiman, president of the Broadband Group, a consulting firm that advised MDG on the Bright House deal.
Bright House President Nomi Bergman said in an email that the cable operator’s moves weren’t influenced by Google Fiber but by MDG’s “desire to embrace technology as a differentiator in the community that they are building.” MDG hopes the fast Internet speeds will attract wouldbe buyers for the new homes, said Greg Singleton, its president.
Big cable operators have played down Google Fiber’s importance in the past couple of years, calling it a costly publicity stunt and questioning the returns Google can make on its fibertothehome buildout. Some cable executives have noted that there are too few applications that warrant gigabit speeds for residential customers today and that there isn’t the customer demand to justify investing in such highcapacity infrastructure.
Ms. Bergman said this buildout will be “different” because it is a special deal with a property developer to extend Bright House’s network to their joint new customers. She acknowledged that it will take “quite some time” for the average consumer to “need” gigabit speeds, so “admittedly we are a bit ahead of the game here.”
Mr. Singleton said he hopes to eventually extend the partnership to provide gigabit service to other new MDG communities, which could reach more than 20,000 homes. “In five or 10 years, I think communities that are not doing this” will be “obsolete,” Mr. Singleton said. He added that consumers’ demands for speeds are rapidly increasing as multiple family members stream
videos, play Internetpowered videogames and work remotely from home.
The companies said the gigabit speeds will allow for smooth streaming as TV evolves to include ultrahighdefinition channels—called “4K”—and more people watch online video from outlets like Hulu and Netflix. They also said such speeds allow for enhanced videogame and videoconferencing capabilities, as well as automation services like Internetcontrolled thermostats and lights that will be offered with the gigabit service in each house.
Bright House said it hadn’t yet decided on the retail price for the gigabit service, though MDG’s Mr. Singleton
said it would be “extremely competitive.”
Write to Shalini Ramachandran at shalini.ramachandran@wsj.com
