KANSAS CITY- It looks like the typical American neighborhood home: a flag out front, a terrace with a rocking chair and a barbecue in the backyard.
But this ordinary Kansas City street contains a hidden treasure. It’s one of the first places to have access to “Google Fiber,” the super-fast broadband that is 100 times faster than the rest of the country (up to 1 Gbps).
Matthew Marcus, Adam Arredondo and Andy Kallenbach moved to the “fiberhood” last October to launch their start-up and explore the opportunities ultra-high speed Internet can offer. With the air of Facebook founder Mark Zuckerberg, they are young, happy, healthy hoody-wearing entrepreneurs.
Two houses down the road is the “hacker” house – where another handful of entrepreneurs live. Without Google Fiber, Synthia Peyne would have never left Denver, Colorado. She says the ultrafast broadband will help her project take off. She organizes live musical concerts where people play simultaneously from different countries: Germany, Japan, the U.S. It’s very much a bandwidth-guzzling process requiring massive and rapid transfers from all around the world.
Mike Demarais came for the same reason. Not yet 20-years-old, he left Boston to move into the hacker house. He is working on a program capable of printing objects in 3D, which later on, he hopes, should be able to replicate human tissue. He doesn’t need ultrafast broadband to launch his start-up, but he might need it in the near future. He likes the fact that all the entrepreneurs in this neighborhood have a community spirit.
“The Silicon Valley and Boston are saturated. No one helps you get started there. Kansas City is a nice place to start a company,” he explains.
Also excited about the new Google Fiber are online gamers: the faster the connection, the better the experience -- and bigger chance of beating your opponent, wherever they may be, explains semi-professional player Nick Budidharma, who settled here a few weeks ago.
The fiberhood has several entrepreneurial hives. Since Google Fiber arrived, about a dozen start-ups have moved in. “I am currently receiving one call a day from entrepreneurs eager to come,” says Matthew Marcus, who renovated his mother’s old antique depot to rent out space to young techies.
With the help of private and public investors, he wants to buy five other houses to make room for young entrepreneurs. It’s not possible for them to move into regular office spaces – Google only grants fiber access to private individuals.
Not all companies moving to Kansas City require ultrafast broadband access. It’s only useful to those working with audio and video formats, or massive databases. However it could, at some point, be useful to entrepreneurs for whom high-speed is central to their strategy – high frequency trading for instance.
Aside from its speed, Google Fiber has another advantage – for only $70 a month, it allows small companies to develop complex information systems, similar to the ones the big firms pay thousands of dollars for. “It’s a blessing for small and medium-sized firms,” says Matthew Marcus.
This is why Toby Rush moved to the neighborhood. His company, EyeVerify, makes bank transactions possible over the phone thanks to a simple retinal verification. No more pin codes, and no worrying about bank accounts being hacked – just like fingerprints, eye morphology is different for each person. And, the small camera in every cell phone makes the process even easier than fingerprint recognition.
After Austin and Dallas, Kansas City is now living the “Silicon Prairie” dream. Something quite novel for this conservative Midwest state of Missouri, which is mostly known for its horse stables and barbecues, rather than for its cutting-edge entrepreneurial spirit. “One hundred and fifty years ago, our towns were transformed by the arrival of the railroad. Now, the arrival of high-tech is changing our geography,” says Pete Fullerton, Kansas City's head of economic development.
“Google put us on the fast lane, but now we need to see how we fare on the road,” adds Drew Solomon, his colleague.
Why on Earth did Google choose this city of 450,000 to test its new system? It is located in one of those regions the investors contemptuously call “flyover country.” Google’s official answer is that it is one the country’s “most entrepreneurial” cities. This is where cell phone giant Sprint and high-tech medical equipment company Cerner were launched.
However, Google’s answer doesn’t show the full picture. This city, like a thousand others, fought hard to be the first to get the high-speed broadband, and visibly paid a lot of money for it to happen. “We didn’t grant any subsidies,” swears Mayor Joe Reardon, “but we do let Google use every space and infrastructure they need for free.”
Google chose this city because it was neither rich nor poor and it allowed the company to observe the everyday life of the average American. The Kansas City slaughterhouses attracted lots of Latinos (10% of the population) in addition to the Black (30%) and White (60%) communities that have been here for quite some time.
A quarter of the city’s population still doesn’t use the Internet. But even though people aren’t using today’s network, Google wants to know what they will do with tomorrow’s network. For them, the company came up with a special offer – if they pay a $300 installation fee, they can have free high-speed Internet access for seven years. “This isn’t going to be profitable for Google, but having a city-wide laboratory is priceless,” explains Drew Solomon.
Google is also interested in the city’s infrastructures. In San Francisco, the networks are buried underground, in New York, they are above ground level and Kansas City has both, so Google can anticipate any problem in those two configurations.
Still, there is a long way to go before the Midwest ousts its East and West Coast rivals as the high-tech capital of America. “It’s very hard to find investors. Even Nebraska does better than us,” admits Cameron Cushman, of the Ewing Marion Kauffman foundation, devoted to entrepreneurship.
Every Wednesday, the foundation lets two entrepreneurs present their project in front of a hundred bankers, investors and company creators. But in effect: “When we need money, we fly to New York or Los Angeles,” says Andy Kallenbach, founder of Zapper, an online HR software provider. The Great Plains region is still too isolated, attracting less than 6% of the country’s “angel investments.”
In terms of talent, the start-up network still doesn’t have the critical mass to draw enough attention, admits Cameron Cushman, financial and human resources are limited. “The best coders don’t live in this region. Local youths prefer to work in an ordinary company and found a family,” notes Andy Kallenbach.
Kansas City knows it only has a very short window of opportunity to change mentalities and its reputation: “When a second city benefits from the Google Fiber, it will become the new Miss America,” worries Mayor Joe Reardon. "We need to capitalize as much as we can while we’re ahead.”
He’s right to be worried: though no specific dates have been set, the technology is expected to eventually be installed all around the country.