Google Fiber TV rates to rise sharply due to programming cost hikes

Google Fiber bills itself as different from most ISPs. (Google)

Citing rising programming costs, Google is hiking prices for its Fiber TV service, telling subscribers in Kansas City (by far its dominant market) they will pay $20 more per month starting in July.

According to the Kansas City Star, a standard cable-like package with the company’s ultra-fast consumer internet connection will increase by $20 a month beginning in July. Internet-only rates will stay the same.

The newspaper said Google has emailed news of the increase to customers in the Kansas City market, which represents some 88% of its subscriber footprint. The emails said the cost of internet and TV without premium channels will rise to $140 a month for those now paying $120 for a single TV box. Rates for extras like HBO, Showtime or sports packages will not change.

For new customers, the same service will start at $160 a month. Google Fiber blamed the price increase on the cost of buying programming.

“Since we launched in 2012, we’ve needed to adjust the price of our TV plans to reflect these increased programming costs,” the company said

The Kansas City market, one of nine that Google operates in, is served by traditional MVPDs Spectrum and AT&T. The competitive difference for Google is its ability to offer ultra-fast internet to all customers.

In a report in March, MoffettNathanson’s Craig Moffett said the company's TV service had stalled at a little more than 84,000 total subscribers. He said the company had “more or less pulled the plug” on the service already, and the numbers only affirmed that.

Google parent Alphabet has shrugged off reports of Fiber’s demise, but the service is one of the many business units being scrutinized as part of companywide cost-cutting. When Fiber launched recently in Huntsville, Alabama, the company leased utility lines instead of laying its own fiber from scratch. And its launch in San Antonio, Texas, will reportedly use a reduced number of facilities for the rollout.