If Google really wanted to promote their own phone and force carriers to move toward a more web centric connectivity model, they could make a deal with a carrier that would completely pay for the phone and the data service, like the following: Most data services from the carriers run from $30 to $50 per month. Many unlocked smart phones run about $600 to $650, which over a two year period, works out to be about $25 to $30 per month. If a carrier would be willing to provide an 'unlimited' data plan for around $39.99, then for about $69.99 per month, on a two-year contract, the phone could be sold for $100 up front, or even given away free, and over the course of the two years, the phone and data would be completely paid for, with Google sweeping up the profits from the ad revenue from the users' web browsing. If they wanted, Google could even sweeten the to compensate for the carrier not making any 'traditional' cell phone plan income, by giving that carrier a small cut of the ad revenue. The real trick would be for Google to convince a carrier that they would bring in enough new users to make it worthwhile to support a program like that - could Google accomplish that?

It's possible that if this all started while, or just after, they got done digging up the neighborhood to run the fiber, that they accidentally did something that is causing line interference or an impedance of some sort. In this case, a line technician would be able to determine an actual physical problem with any of the lines. Obviously, a phone call to have them check won't hurt.