It can get a little bit annoying when people ramble on about how Facebook and Google are taking over the world. They're just websites! But when those websites start to buy up other things, say, the very cables that connect the people of the world — well that's actually pretty alarming.
It's also happening. The Wall Street Journal reports that major web companies like Facebook, Google, Amazon and Microsoft have been slowly buying up significant portions of the internet infrastructure. This is making the major telecom companies — who have traditionally controlled the cables — very nervous.
We're not talking a wire here and a wire there, either. In addition to the small army of robots they just bought, Google now owns over 100,000 miles of private fibre optic routes around the world. (For point of comparison, Sprint owns just 40,000.) Facebook just finished installing a massive high capacity network throughout Europe that links back to its massive Arctic data center in Sweden. The social network also just invested millions to help lay a 6,000-mile-long cable across the Pacific. Meanwhile, Amazon's spending on infrastructure is up 44 per cent to $US2.6 billion as it buys up more fibre networks, as Microsoft builds its own networks and invests in underwater cables.
Everybody's doing it! Stringing new fibre optic cables around the globe is a major investment even for these multibillion dollar conglomerates, but that's how they can control how much they're paying for bandwidth. In the past, the major telecom companies have been free to charge what they like, and while bandwidth costs have been declining steadily, there's no guarantee that this trend will continue. Owning the infrastructure also means that the internet companies serving up content to consumers will also keep a firm grip on quality. The last thing they want is users to flee because a crappy network is causing their sites to run slow. As Dan Caruso, CEO of a company that sells fibre to these internet giants, put it to WSJ, "It's really about controlling their own destiny."
The big question, at this point, is whether or not this is going to affect you. In the short term, it's probably good news as more cables mean more bandwidth, probably at cheaper prices. A decade or two from now, though, we could be looking at an internet that's mostly owned by internet companies and who knows how these companies will run things differently. That said, it can't be too hard to improve internet service. After all, telecom companies and ISPs are the most loathed companies out there. [WSJ]
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