What started as a search engine in the nineties, has become an empire1. Nowadays Google’s products/solutions go from online services to automated cars, passing through smart thermostats.
It’s hard to imagine a world without Google, people has become somehow dependent on the majority of their services.
I would like to focus on Google’s moves into the telecommunications industry. I think it is crucial to understand the evolution and importance of Google’s role in it.
Let’s start with the easy one, Android. According to IDC, Google’s Android Operating System, dominates the worldwide smartphone market with over 80% of the market share.
But Android is just the tip of the iceberg.
Google Fiber 2, is not only “a fiber-to-the-premises service that provides broadband internet and television to its subscribers” but the first step from the company into new grounds: the ISP grounds.
It was perhaps, the first time the telecom industry saw Google as a threat.
Today, the Wall Street Journal reported that Google had signed a deal with Sprint and T-Mobile to become a nation-wide Mobile Virtual Network Operator (MVNO).
We are living the beginning of the Over-the-Top (OTT) era. Services offered by companies like WhatsApp, Skype, Facebook, Twitter, YouTube, Spotify, Netflix, etc. have become a big part of our lives. On the other hand, mobile network operators (MNOs) are struggling to remain relevant and are afraid of becoming dumb pipes.
However, the concept behind MVNOs relates perfectly to the concept of OTTs and dumb pipes, but to an even greater extent. Google will be using Sprint’s and T-Mobile’s networks to offer their own service, just as any OTT uses the MNO’s network to offer theirs.
By becoming a MVNO, Google will also become the first enhanced OTT player (eOTT) in the world.
eOTTs have to be considered as something different from OTTs. Firstly because they are not only OTTs, but a hybrid players that have control over their network.
Google will be able to leverage the pros of controlling both the service and the content, without caring about the big problem OTTs face: Net Neutrality (or lack of it).
Does this mean that MNOs have lost the fight against OTTs/eOTTs?
Not yet. I think it is too soon to know that, but it might as well be the beginning to an end for the MNO’s attempts to stay relevant.
Let’s recap: Google controls most of the internet services, their mobile OS is in most of the smartphones people use today, and they now offer fixed (Google Fiber) and mobile services. Do you see it? They have it all, and the MNOs, well…don’t.
I’m not implying that this is the end of the MNOs. The MNOs will still play a huge role in the industry. They still own the network, and they own the most precious asset for mobile communications: spectrum. But it is clear that they are in fact, becoming Dumb Pipes and it seems like they aren’t doing much to avoid that.
I’m really keen to see what happens next. Will the MNOs finally wake up and bring new things to the table, or will they let the OTTs/eOTTs win the battle? What would Google do next? Let’s remember that this is a juicy business that no one wants to lose.
If you ask me, I would say that MNOs should find a sharing model that adapts to what the MNOs, the OTT/eOTT and their subscribers/users want. Sharing is Caring.
Whether that is good or not is very debatable. I think Google is a double-edged sword. Sure, a lot of people (including me) benefit from their services, and products but there is something that just smells funny about the Palo Alto company, something that reminds me of George Orwell’s Big Brother. It seems to me that Google wants to control it all. ↩
In 2011, shortly after a trial in Palo Alto, California, Google deployed fiber in Kansas City, Kansas. Later, in 2013, the service then expanded to Austin, Texas, and Provo, Utah, and it is expected to expand to more cities this year ↩