Google decided to extend into the wireless industry by introducing Project Fi on Wednesday – a new service promising better and faster connectivity for less money, soon to be available for mobile-phone users in the United States.
The search engine company is not looking to make a fortune out of it, but that hasn’t stopped them from doing their best. According to the presentation, the Project Fi allows your phone to automatically connect to the strongest signal available. That might be a good Wi-Fi hotspot nearby, or a cellular tower of Sprint or T-Mobile – two carriers that partnered with Google in a head-on challenge for Verizon and AT&T.
With Project Fi, Google has sparked an unexpected technological advancement, but probably not big enough to change the face of wireless connectivity. However, it’s pretty impressive what they promise their users: a unique subscription plan where you get your money back if you haven’t used all the data.
According to Colby Synesael, analyst at Cowen and Co. Google’s strategy behind launching Project Fi is not to make more money out of it, but to inspire other mobile-phone subscription providers to change and improve their policies. He added that Google’s likely goal is to impact other carriers, so they will start “borrowing” some or other aspects of their idea.
Innovations in the carrier industry
Besides the appealing service of being able to automatically tap into a million free Wi-Fi hotspots, Google has added more to the table: cloud-based contacts, encrypted calls, ability to use said contacts from any Internet-connected device, and last but not least, the service of Wi-Fi voice call.
Upon launching Project Fi on Wednesday, John Legere, CEO of T-Mobile, proved to be one of the biggest supporters and partners. Legere published a blog post saying that we should welcome anything that forces us to get outside the industry’s comfort zone, shaking up the status quo.
He added that carrier owners have become stubborn in their set ways and thus the U.S. wireless hasn’t been advancing and making improvements in a long time. Some fresh thinking will do the industry really good at this moment.
But maybe Google hasn’t thought this move through; unfortunately, Project Fi will only be available on Google’s Nexus 6 smartphone, at least for now. This limitation inhibits most of the positive effect that the company claims it wants to have on the wireless marketplace.
As Derek Turner, chief research at Free Press, says, the fact that you need to own a very expensive Nexus 6 in order to benefit from Project Fi’s innovations will keep a lot of people not interested.
Device limitation restricts Google’s goal
But Google hasn’t got a lot to fear – even if Project Fi might launch with a slow start. It wouldn’t be the first time when the company achieves industry-altering advancements from small projects that started rather shakily; Google Fiber, the high-speed Internet service, caused enough consumer curiosity in spite of the heavy start – enough that Comcast, one of its biggest rivals, felt compelled to offer faster connections.
AT&T’s chief financial officer, John Stephens, isn’t very concerned about Google’s carrier. The fact that it will only be available on such a limited number of devices – which isn’t AT&T’s way of doing things – has got the company reassured it has little to worry about.
As The NPD Group Vice-President Stephen Baker explains, Stephens might be onto something when he shrugs off Google’s carrier as a threat; less than 1 percent of all Android smartphones sold in the U.S. are Nexus – which means Google’s target customers are in really small numbers.
That’s why Baker calls Project Fi an “experiment” and not a real business startup. Which such a limited impact, Google’s initiative is more of a demonstration of how far technology has come and not a real threat to the way carriers do business in the present.
For $20, Project Fi offers basic voice and texting; each additional $10 guarantees a gigabyte of data. If you still have some unused data at the end of 30 days, Google said it will offer its customers refunds. This is a very different approach to the unlimited subscription plans that are now trending among all carriers.
Image Source: AnandTech
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