Alphabet Seeks Investor Financing for GFiber Internet Service to Expand Beyond Current Sites
By Trisha Andrada
Feb 06, 2024 06:34 AM EST
Feb 06, 2024 06:34 AM EST
Alphabet said it intends to seek outside funding for GFiber, its Wi-Fi and internet business that operates in some areas of the United States. In a report by Reuters on Monday, Feb. 5, the corporation expressed its desire to accelerate GFiber's development to more cities.
Larger internet service providers like Comcast, Verizon Communications, and AT&T compete with GFiber, which Google's parent company owns.
Launched in Kansas in 2012, GFiber has grown to 15 states after making a 14-year commitment to increase internet speeds 100-fold with fiber-optic connections.
According to GFiber, which would not disclose the exact number of customers, the company's client base has increased thrice in the last six years. In 2023, it inked agreements to expand its services to over 25 more locations.
Despite this, the firm is up against formidable competitors and has failed to roll out internet service to vast portions of the US, including six of the ten most populated cities, including New York.
Ruth Porat, president and chief investment officer of Alphabet, told Reuters that after this next round of external fund financing, GFiber will be able "to scale their technical leadership, expand their reach, and provide better internet access to more communities."
Alphabet chose not to comment on GFiber's value or the amount of money the company was attempting to raise.
An individual familiar with Alphabet's plans said that GFiber has already retained the services of an investment bank to initiate the sale of the company's shares. The insider, who preferred to remain anonymous, said that GFiber's long-term objective is to break away from Alphabet.
A remark from GFiber CEO Dinni Jain stated: We are now ready to scale this much faster."
Alphabet's so-called Other Bets include GFiber and other companies in the company's early stages of development or commercialization, apart from Google. Included in this group are Waymo, a self-driving vehicle firm, and Verily, a healthcare company that has received capital from investors.
According to Alphabet's annual report, the Other Bets lost $4.1 billion in sales in 2023 while making $1.5 billion in sales, mostly from healthcare and internet-related services.
Last week, Porat--also the chief financial officer--told investors that Alphabet's goal was to sharpen investment focus and capture the benefits of significant technological advancements throughout the company's Other Bets portfolio.
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