Alphabet Inc. Fiber
Alphabet Inc. (NASDAQ:GOOGL) dominates the digital advertising landscape driven primarily its Google Search. But the company is pursuing so many other transformational themes it's almost impossible to keep track of. The company has a booming e-commerce business that will soon compete with Amazon.com Inc. (NASDAQ:AMZN). It has announced a new social media network to compete with Facebook Inc. (NASDAQ:FB), it's pushing full throttle on the technology behind artificial super intelligence and self-driving cars. It's pursuing artificial intelligence with Google Dream.
Alphabet is even pursuing a connected home with Google Home and a further push into artificial intelligence with "Tango." It's pushing the envelope with the fastest growing segment of media in the world, which is online video. You Tube has more viewers aged 18-49 on mobile alone than any U.S. broadcast or cable network.
That's an exhausting list, but now we have one more to add. Alphabet aims to be the largest high speed Internet provider in the United States.
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ALPHABET INC. (NASDAQ:GOOGL): GOOGLE FIBER
Google has its 1 gigabyte per second fiber high speed Internet running in 22 cities in the United States, charging $70 per month for service which can be lower than current cable Internet connections. While it's the story hidden in plain sight, Alphabet is pushing forward to turn the connectivity business into a giant segment of Google in and of itself.
We caught news on June 14th that Alphabet is looking to expand Google Fiber to Dallas, Texas. This city, in particular, is out of the ordinary because its Google's first move into a large city where it will compete directly with large cable networks. Of course, this goes beyond a city -- this is the beginning of Google taking Fiber to prime time. After the Dallas expansion, watch for Alphabet to look at Los Angeles and Chicago -- two cities that have been hinted at before by the firm.
By the time Google goes that far, the stock market will notice that there are 281 million Internet users in the United States which marks an 88% penetration. Of those people, over 56 million have a cable Internet connection. Here's the chart from our friends at Statista:
As that number approaches 60 million, the addressable market for Alphabet reaches nearly $50 billion in annual sales. Obviously Google will not own the entire market, but even a piece of that segment is not trivial to Alphabet's total revenue base of $75 billion in the last year.
WHY THIS MATTERS
The kind of growth that creates companies like Apple, and Google comes from fundamental changes in technology and the economy. At Capital Market Labs, we identify these transformations, and the companies that will benefit most from them to find the "next Apple" or the "next Google." Our research sits side-by-side with Goldman Sachs, Morgan Stanley and the rest on professional terminals, but we are the anti-institution. Our purpose is to break the information monopoly held by the top .1%.
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