Google Fiber Cutting Jobs and Halting Rollout

The Entity that WAS AT&T became

Southwestern Bell - became AT&T inc by buying Ameritech, AT&T Corp. Pacific Telesis, BellSouth (all Baby Bells)

Bell Atlantic/NYNEX - merged to become Verizon buying GTE, MCI Worldcom along the way

US West - merged with Qwest, acquired and became CenturyLink

"the original AT&T" is those Baby Bells not just the empty shell that became AT&T Corp. (aka ATT Long Distance)

The takeaway is that the ORIGINAL AT&T split into 3 companies and swallowed GTE, MCI, Worldcom, and Qwest in the process. It ended up being a consolidation. 4 of the 7 baby bells are back together operating under the AT&T name, that's over half the old company.

I think there are two big reasons:

The market changed. When they launched Fiber, they're announcement was reminiscent of GMail when it launched. Back then, getting a 15-30MB free web mailbox was normal and Google announced a start at 2GB. Memory may not serve me perfectly, but I believe when they launched Fiber, there wasn't a single ISP offering residential service at 1Gbps and very few at even 100Mbps. I live in a city that is neither Fiber available or even on the list of future Fiber cities, but I can get multi-gig service for the price that I think the 100Mbps service was offered when Fiber launched. Most of this happened because of Google Fiber -- these companies were not terribly interested in increasing their capacity and service before, but knowing that a huge company like Google, who realistically had the funds to do a roll out, was potentially going to invade their monopoly territories was enough to get the market to move. This also, unfortunately, reduced the need for them to do it. Market-wise, they'd have to fight harder for customers since their service may not be so much faster/better/cheaper to get people to endure the hassle of switching.

The reality of what the market is was discovered. They had hoped they'd be able to do the roll out cheaper, with the involvement of local regulatory bodies itching to have their cities added to the program and paving over regulations that historically made doing a roll out like this very expensive, time consuming and difficult. The incumbents, who already had networks and had to deal with and work through those same regulations cried foul, started suing and made this all more costly and difficult. Back to point #1, with other ISPs offering service at a similar speed and at a far reduced price from when Fiber launched, this took some of the motivation to pave over those regulations away from the regulatory bodies. And this is all without the reality that many of those elected officials who make the laws that caused these problems have their re-election paid for by the AT&Ts, Comcasts and Verizons to a far greater extent than they do Google, so they're even less motivated to help them out.

Google really underestimated how hard it was going to be to run cable underground in Austin, with it's limestone ("Austin Chalk") often just inches below the grass & shrubbery.

I'd still switch to Google Fiber. As someone who spent over a year dealing with what AT&T calls "support"[0], concerns that Google could be any worse would be minimal for me.

In all likelihood, if they do completely abandon Fiber, rather than finding another way to provide the service that doesn't require digging, they'll sell it off to another ISP (I think TFA mentioned CenturyLink). Their DVR was (is?) based on SageTV's product, which I ran at home and found to be excellent (the extent to which it differs from their original product may change my mind on that assertion, though).

[0] I had a problem with my DSL service at my family's home up north that required sending out a tech on 13 different occasions, which required me to drive two hours up north to meet him. I went through four different DSL modems (none of which were broken, but they were basically throwing darts at a wall with a blindfold on). They'd show up, find nothing wrong (on one occasion they offered to replace my interior wiring and decided against it when they discovered I ripped it all out and replaced it with one proper cable run using better cable than they'd install ... and the readings from their test equipment indicated the wire was very clean). They never actually fixed the problem as a result of a service call, it just went away at some point last year.

But now that GF is slowing down, incumbents will fall back into their monopolistic slumber. Without threat of competition, they won't be motivated to spread their upgrades wider. So in a sense, yes, spreading more Google Fiber makes monopolists compete, which makes spreading it harder, but that was the whole point for Google, wasn't it? So if they back down now, their goals will be compromised.