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Tuesday, August 28, 2012

Time Warner Cable races before Google Fiber

Time Warner Cable Inc. (TWC) will expand fiber-optic lines to businesses in New York, a move that boosts Internet speeds as much as 20 times and provides an East Coast counterpoint to Google Inc. (GOOG)’s ultrafast network in Kansas City.

The second-largest U.S. cable company is spending $25 million this year to expand fiber networks in the boroughs of Brooklyn, Manhattan, Queens and Staten Island. Time Warner Cable will announce the investment today at the Brooklyn Navy Yard.

“We’re making the investment to expand into areas much more aggressively than we ever have before,” Ken Fitzpatrick, president of business services for Time Warner Cable’s East region, said in an interview. “We’re positioning New York City as a much more tech-savvy place to work.”

The company faces a threat from Google more than 1,000 miles away in Kansas City, where the Internet-search giant is building a fiber-optic network as a test project. Time Warner Cable is the main broadband provider for the area, which spans parts of Missouri and Kansas. While Google’s network will be available to both companies and households, Time Warner Cable’s New York fiber network is focused on businesses.

Time Warner Cable is designing its fiber-optic network to provide speed of 1,000 megabytes per second. The company recently completed installation to all small businesses in the Empire State Building and is extending its network to locations in Midtown, the Flatiron area and the Financial District.

Time Warner Cable’s Business Class service offers high-speed Internet to about 450,000 small-business customers. The New York-based company’s sales from business services rose 29 percent last quarter to $464 million. The revenue accounts for 8.6 percent of Time Warner Cable’s total sales.

Google’s fiber expansion may benefit Time Warner Cable’s business because “the more people figure out how to use broadband, the better off we’re going to be,” Chief Executive Officer Glenn Britt said during a conference call this month.

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