Alphabet's Google Fiber Service Now Available In Alabama

Alphabet’s (NASDAQ:GOOGL) high-speed Internet service, Google Fiber, is now available in its next city, Huntsville, AL.

Coming to the price performance, shares of Alphabet have steadily treaded higher on a year-to-date basis. The stock returned 22.46% compared with the Zacks categorized Internet Services industry’s gain of 18.42%.

Details

This time Google has not invested in building the fiber network. Instead, Huntsville Utilities, a city-owned provider of water, electricity and natural gas, has built the fiber network and leased the infrastructure to Google Fiber.

Google Fiber now provides high-speed Internet connection of 1 gigabit per second to both residential customers and small businesses. For now, the service is available only in the northern part of the city. However, it will take time to extend the service throughout the city.

Caroline de Gantes, Google Fiber's head of business operations in Huntsville, said, “Leasing the infrastructure in Huntsville rather than building from scratch allows us to bring Google Fiber to even more people, and even faster.”

Google Fiber

The high-speed Internet service, Google Fiber, was launched in Kansas City, MO in Sep 2012. With the launch, the company intended to put pressure on major broadband providers like AT&T (NYSE:T) ), Comcast (NASDAQ:CMCSA) and Verizon Communications (NYSE:VZ) to upgrade their networks to support higher Internet speeds.

However, last October, Google Fiber had to put on hold its plans of rolling out fiber optic cables across a number of U.S. cities. This decision was a part of the company’s revaluation strategy to focus on wireless technology as an alternative way to roll out high-speed internet to subscribers.

Currently, the Google Fiber website lists Dallas, Jacksonville, Los Angeles, Oklahoma City, Phoenix, Portland, San Jose and Tampa as potential cities where the company has plans of expanding its service.

Although price details are yet to be available for Huntsville, Google offers speeds of up to 1,000 Mbps (1 gigabit per second) for $70 a month — about 100 times faster than the average broadband speed in the U.S. — and cable service for $130 per month in its other cities.

Bottom Line

The company’s plans of expanding its reach reflect intensifying competition in the broadband space. AT&T has been expanding its super-fast Internet service to other new cities including certain parts of Los Angeles.

However, Alphabet can bank on its speed to attract users. Also, with Google Fiber’s expansion, which is comparatively faster than most existing Internet providers in the U.S., the company is pushing its peers to upgrade the Internet services or lower the prices. With the expansion of Google Fiber network, users will go online more frequently and are more likely to use its other services, thereby driving revenues.

Alphabet has a Zacks Rank #2 (Buy). A better-ranked stock is TiVo (NASDAQ:TIVO) Corporation (NYSE:T) , sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

TiVo Corporation delivered a positive earnings surprise of 67.56%, on average, in the last four quarters.

Alphabet Inc. Price and Consensus

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