Google closes deal to acquire iProvo
Google Fiber (Nasdaq: GOOG) has finalized its deal to acquire iProvo, the fiber network owned by the city of Provo, Utah. The deal pits Google against landline incumbent CenturyLink (NYSE: CTL) and cable MSO Comcast (Nasdaq: CMCSA).
Google announced April 17 that it planned to purchase the iProvo network for $1. At the time, Google said it planned to upgrade the existing network to 1 Gbps technology and complete network construction so all homes in the city can get access to the service. In addition to the 1 Gbps service, it also plans to offer a free 5 Mbps service to the 115,000 residents on the existing Provo network who pay a $30 activation fee.
Provo joins Kansas City, Kan., and Austin, Texas, as the third city to offer Google Fiber to its residents.
Not surprisingly, Google faced some opposition to its acquisition of iProvo, primarily from CenturyLink. Shortly after Google announced its plan to acquire iProvo, CenturyLink sent a letter to the Provo City Council protesting the deal. Interestingly, CenturyLink's current DSL-based service offers broadband speeds between 1.5 Mbps and 40 Mbps, depending on how far the customer resides from the central office. In addition, customers have to abide by usage caps. Meanwhile, Google Fiber promises speeds of 1 Gbps.
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