Friday, November 13, 2009

Google commoditizes another layer

The news says that Google is offering “free Wi-Fi” at 47 airports through January 15. Google issued a press release Tuesday, posted it to their blog and created a new website (They’re also sponsoring Wi-Fi on Virgin America flights).

My wife was traveling through two airports Tuesday and got to try out the free Wi-Fi. She also saw the airport advertising displays giving Google credit for this “free gift.”

However, there’s a problem with this story. At least two of the 47 airports (SAN, SJC) are ones that I regularly frequent that already have free Wi-Fi. They both had it last month and last year. So what does it mean to give us free something we already had? Does that mean Google’s (or the airport) is going to take it away? Or does it mean the airport already had the costs real low and thus it was relatively cheap for Google to buy sponsorship?

At a broader level, Google favors anything that commoditizes Internet access. An early example was when it began giving away free Wi-Fi in its adopted home town of Mountain View — and helping to end the mirage of paid municipal Wi-Fi networks.

Google wants Internet access that’s fast, ubiquitous and cheap, because in simple economic terms Internet access is strongly complementary to wasting a lot of time feeding keywords into the Google money machine. And of course cheap Internet access also grows the market for all of Google’s Internet services — which will be helpful should it ever find another profitable revenue stream beyond search.

Update, 8:30am: In response to a comment (below) about whether Google’s sponsorship is bad, let me better articulate my late night concerns.

I'm frustrated by a lack of transparency — not the first time with Google.

  1. What does it mean to "sponsor" Wi-Fi that is already free? How much is Google paying? Perhaps a newspaper reporter at the San Jose Mercury, San Diego Union or Las Vegas Sun will ask some pointed questions.
  2. Why is it advertising in the airports that it’s doing us a favor without noting that it was previously free?
  3. What happens when the sponsorship ends? I.e., does Google sponsoring it mean that our formerly free service is no longer free?
Sure, the AP story Tuesday about Google’s free airport Wi-Fi (and smaller efforts by Microsoft and Yahoo) said
The 47 airports include some, such as Mineta San Jose International Airport and McCarran International in Las Vegas, that already provide free Wi-Fi. Sponsorships help the airport keep the service free.
but “help” doesn’t explain whether this is defraying part of the cost, paying the entire cost, or helping airports make a profit — nor does it say what will happen when Google stops “helping.” Airports are almost entirely public entities, so more transparency here is certainly a legal requirement.

This is obviously a trial balloon. If Google pulls out and the service at these airports goes from free to free to paid, there will be a huge backlash — against the airports and against Google.

If I had to guess, I’d say Google is laying the groundwork for running ad-supported free Wi-Fi at all US airports, with these as pilot projects. Such free Wi-Fi would improve Google’s image and political standing with an influential segment of the public (frequent travelers), at a time when it faces increasingly pointed questions (e.g. in antitrust, Google Books) in its march to Total World Domination.

1 comment:

Anonymous said...

I take your point that free WiFi has already been available at many of the locations offered by Google. However, you seem to be suggesting that any selfish motivation for Google's support of free cheap internet access invalidates the provision of said access. Surely the fact that the internet is free and cheap still benefits Joe Bloggs - even if it is a money-spinner for Google?