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Google’s ultrafast Internet draws startups to KC

Published: Monday, Jan. 14, 2013 12:19 p.m. CDT

KANSAS CITY, Kan. (AP) — Inside a small bungalow on the street separating Kansas City, Kan., from its sister city in Missouri, a small group of entrepreneurs are working on their ideas for the next high-tech startup, tapping Google Inc.’s new superfast Internet connection that has turned the neighborhood into an unlikely settlement dubbed the “Silicon Prairie.”

The home on State Line Road is one of several startup-friendly locations that have sprouted up in Kansas City in recent months. The catalyst is Google Fiber, the search-engine giant’s fiber-optic network being tested in the Kansas City area that advertises speeds of up to a gigabyte per second — a rate that massively exceeds the average Internet speeds at homes hooked up with cable modems.

The advantage here for startups is simple: A fast Internet pipe makes it easier to handle large files and eliminates buffering problems that plague online video, live conferencing or other network-intensive tasks. Though the Kansas City location presents challenges for startups, including the ability to raise money outside the traditional Silicon Valley venture capital scene, entrepreneurs like Synthia Payne believe it’s the place to be right now for up-and-coming tech companies.

Payne is one of those entrepreneurs hoping to launch her startup dream — an Internet subscription service for musicians who want to collaborate online — on the cheap. She shares the State Line Road house, known as the “Home for Hackers,” with other startups under a deal that allows them to live rent-free while they develop their business plans.

Google’s network was attractive, Payne said, because her business plan “is dependent upon really good, really fast Internet.”

“Without this on-ramp here I probably would have found it very difficult to come here,” said Payne, who in December moved from Denver to develop CyberJammer.

Residents here were thrilled when Google announced last year that Kansas City, Kan., and neighboring Kansas City, Mo., would be its test bed for Google Fiber. The Mountain View, Calif.-based company spent months and unknown sums installing optical fiber around the area. Google provides the full gigabit service for $70 a month and its own cable-TV like service for another $50. A slower Internet connection is free on a monthly basis after a $300 installation fee.

The first homes were installed with fiber optics in the fall, with more “fiberhoods” planned in stages over the next several months. Kansas City, Mo., and Kansas City, Kan., remain Google’s only fiber market, though the company has said it plans additional roll-outs. Many in the tech industry believe Google’s move could ultimately force broadband providers to accelerate their networks to compete. Making Internet access faster would give the company more opportunities to attract traffic and sell more advertising — the main way Google makes money.

The “Home for Hackers” and its unique business pitch is the brainchild of local web developer Ben Barreth, whose property was among the first wave of houses to be fiber-wired and is a block away from the Google Fiber offices. Since starting the home in October after cashing in his Roth IRA and putting a down payment on the $48,000 home, Barreth has gotten applications from nearly 60 people seeking a spot in the home.

“The hope is that these startups will move their operations to Kansas City and this will really bless Kansas City, bring jobs and taxes and we’ll build a really cool tech scene,” Barreth said.

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