While the United States is a leader in Internet technology, and while the majority of citizens have access to the Internet, providing ultra-high speed access has not been on anyone’s radar. However, all of a sudden the overwhelming focus is on speed. So where are we in the rollout of this service and who will the winners and losers be going forward?
Who needs this much speed? Neither carriers nor customers were screaming for ultra-high speed Internet connections. Everyone seemed happy and satisfied. Most customers got their high-speed Internet access from their local phone company or their cable television company.
However others like Google (GOOG) wanted more. They didn’t see carriers upping the speed so a few quarters ago they decided to get into the service provider business. They built and rolled out a full, one Gigabit service in the Kansas City area.
This move turned out to be a big success. Out of the blue customers and companies loved it and cities wanted to be the next in line for this competitive advantage
So does this put Google in competition with traditional high-speed Internet providers like AT&T (T) , Verizon (VZ) , CenturyLink (CTL) , Comcast (CCS) , Time Warner Cable (TWC) and Cox. Or were they just trying to make a point? So now that the point is made, we will see whether Google backs away.
So what has been happening since? Plenty. A few carriers are jumping on this opportunity and leading in this new area.
AT&T just introduced their first U-verse GigaPower market in Austin Texas. CenturyLink just introduced their first one gigabit fiber Internet service in Las Vegas. C Spire is in the process of building their Fiber to the Home ultra-fast Internet service in multiple cities in Mississippi.
These companies are the early adopters. These companies could indeed be among the big winners in this new high-speed race. If all works out well, I can see this very fast Internet service rolling out quickly from coast to coast over the next few years.
Early adopters will have the advantage as always. They will be looked at as the industry innovators. However after some time, ultra-fast service will become normal and then demanded by customers. That’s when all other service providers will have to jump in to stay competitive.
Just look at the reaction among Mississippi cities to be the first to win this new C Spire service is incredible. City governments see this as a great way to be on the cutting edge and attract citizens and businesses. People and businesses see this is a very attractive service as well.
I would say 2013 was the gunshot to start this new wave, but 2014 this revolution will explode with growth. Suddenly everyone will be screaming for this ultra-high speed service.
So Who Will the Winners Be?
The first mover advantage will be in play.
Winners will be companies like AT&T, CenturyLink and C Spire. Google too if they stay a service provider. The early players in this new space.
Winners will be early adopter cities who will have an advantage very few others cities have.
Winners will be users who have access to the newest and fastest service in the market.
What About the Losers?
Losers will be the companies, cities and users who don’t jump in early. Who won’t have access to this new cutting edge technology advantage.
If we look five years out, I would say there will be two types of markets. Ultra-high speed markets, and the rest, meaning ordinary speeds.
These ultra-high speed markets will be the big winners. Along with the companies that provide that service and the customers who use it and cities who offer it.
The next several years will be very interesting to follow. One nagging question is, will Google stop or are they now into the service provider business? This is an entirely different model, but then again, so are all their new businesses as well.
DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: http://www.equities.com/disclaimer