Google’s Sidewalk Labs Expands into Out of Home

Google recently announced the creation of a urban-focused business unit named Sidewalk Labs.  The news as reported in Bloombergframed the move as part of Google’s ongoing quest to wire as much of the population as possible in order to serve ads on their devices and provide cloud services.

Sidewalk Labs’ first major move has been to acquire two companies – Control Group and Titan – aimed at providing free fast Wi-Fi to New York City. They will be merged into a new entity named LinkNYC aiming to rollout in NYC in the Fall of 2015. The strategy is to reinvent the phone booth and up the quality of out of home digital advertising in cities.

The announcement makes it clear that OOH advertising will be a key part of the business model. This  again from Bloomberg:

Come September, tall, thin pillars with digital tablet interfaces and large ads slapped on the sides will begin to replace New York’s derelict pay phone booths. In addition to offering free wireless Internet access to anyone in a 150-foot radius, they will include amenities like free phone charging, phone calling, Internet browsing, and access to local services and information. Through Titan’s advertising network, Link could bring $500 million in ad revenue to the city over the next 12 years, according to Mayor Bill de Blasio’s office. Sidewalk Labs declined to disclose its share of the revenue.

Sidewalk is targeting issues of modern cities such as pollution, energy, traffic, communications, and cost of living. “It was formed to look at the confluence of the physical and digital world to solve urban problems,” Chief Executive Officer Dan Doctoroff said. He wouldn’t say which cities he has in mind for the Wi-Fi push but predicted the technology will go global. “There are certainly places that it’s immediately replicable,” he said, adding that the idea is to “use technology not to make cities all the same, but enhance what makes them unique and individual.”

These types of Wi-Fi  hotspot / phone booth hybrids (to be named ‘Links) have already been deployed in other countries successfully. Google and NYC see a win-win in the ability to monetize the thousands of increasingly derelict and unused phone booths that litter NYC sidewalks.

The ability to serve digital advertising on the outsides of the structure generates a cash flow that benefits both parties. The ad revenue generated for the city is projected to be $50M over the next 12 years.

How long will be be before you can buy a display ad impression for the corner of Layfayette and Houston via AdWords? Or that targeted display ads flash on phone booths as you walk buy, along with  coupons on your Google Now app?

This is a second lease on life for the venerable and endangered phone booth.

In a nod to the nostalgia value, three traditional booths will be preserved on the Upper West Side. Unfortunately, the Links are  standalone pillars and do not have doors, so Superman will not be changing in them anytime soon.

Julie Roehm