Old Blog

Broadband Speeds Are Improving in Many Places. Too Bad It Took Google to Make It Happen.

Historical point:

What Google’s doing, in these cases, is using its deep pockets in the interest of broader social ends, with seemingly little concern for short-term returns. This strategy has historical precedent. In the early years of the American republic, there was little appetite for government spending on public works, like roads and canals. But the country needed better roads to facilitate the growth of trade and commerce. So the states turned to private companies, which built turnpikes that they then operated as toll roads. In the late 18th and early 19th centuries, hundreds of these companies invested millions of dollars in laying thousands of miles of road, in effect providing the basic infrastructure for travel in the United States.

What’s interesting about these companies is that while they were, in theory, for-profit, and while they had shareholders, in most cases there was no expectation that they would actually turn a profit in operating the roads—tolls were kept low enough to encourage traffic and commerce. Instead, the shareholders—who were typically local merchants and manufacturers—saw their investments in turnpikes as a way to collectively provide a public good that, not incidentally, would also deliver benefits to them as business owners and consumers. They knew, of course, that other businesses would benefit from these roads even if they didn’t invest in them (the nature of a public good being that everyone can use it). But that didn’t mean the investment wasn’t worth making. It’s hard not to see a similar logic underlying much of what Google does.

via MIT Technology Review.