Google and Facebook have expanded their efforts to control the Internet by investing in infrastructure.
The latest is that they are planning to control more of the www’s backbone in this manner, and it’s raising tensions with a number of telecom companies. The plan involves bringing online new underground cables they have funded, inking agreements to build dark fiber and building their own networking hardware.
What’s going on? In the process, these companies are starting to rival some of the companies that used to count them as clients. Google now controls more than 100,000 miles of routes worldwide, making it bigger than the continental U.S. network run by Sprint, which covers less than 40,000 miles.
According to executives, tech companies are seeking to reduce costs and improve performance of their Internet. They also want to guarantee that they have enough capacity to support growing traffic for their online images, video, games and other services.
Amazon and Microsoft are invested heavily. Amazon and Microsoft are investing heavily in their network infrastructure so that they can accommodate growth in their cloud-computing businesses. Many telecom companies say they do not want to relinquish control of the lines to what were their biggest customers. The industry is grappling with the concern that it will be reduced to “dumb pipes” and that this trend will downgrade it even more.
Online traffic is soaring, driven by streaming video and smartphones, all of which have expanded the reach of the Internet to millions more customers. Internet companies have responded by investing in the pipes to ensure that traffic can be supported so that they can have access to new and more remote users.
Since telecom companies are not spending as much on new construction, Internet providers want the certainty that comes from owning the assets. Google started the move in 2008 when it joined an investment group to build a $300 million cable system connecting California with Japan. The company has extended its reach in Asia with a 6,000-mile cable that links six countries, including Singapore. It has entered into long-term agreements to control private fiber optic routes linking its major data centers to America’s 12 major largest Internet hubs as well.