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Wilting Muni WiFi

Remember that glowing column I wrote about the prospects of city-wide wireless networks? It's looking a little ahead of its time--which is to say that "ahead of its time" could be my new synonym for "wrong."

Since that piece ran in April, the Internet provider behind most of the largest efforts--Atlanta-based EarthLink--has begun to bail out of the business. It abandoned its efforts in San Francisco and in other major cities, as a front-page story in USA Today last week summarized.

Locally, EarthLink has told the two governments with which it had already inked contracts--Alexandria and Arlington--that it wants to rework its deals to have each jurisdiction pay for a set amount of service upfront. Company spokesman Jerry Grasso e-mailed at the end of August:

we are approaching govt. officials to discuss needed changes in our business model, which includes them stepping up to some sort of anchor tenancy agreement. Our CEO has stated publicly that he is not willing to invest any more money in new network build outs under the old business model: coming in up front with the cash to build out the network and trying to buy customers one at a time.

Grasso said that EarthLink continues to operate completed muni WiFi networks in Corpus Christi, New Orleans, and Milpitas, Calif., plus two under construction in Anaheim and Philadelphia.

Since then, nothing too positive seems to have happened with the two local WiFi projects. Grass had no news to report this morning. Alexandria's existing wireless network is now "temporarily unavailable," and in Arlington, county spokesman Rob Billingsley e-mailed to say the county has yet to hear anything new from EarthLink. "We still continue to work on improving the options Arlington residents have for broadband access," he wrote in an e-mail Monday morning. "Simply put, the ball's in Earthlink's court and we are moving on."

So is municipal WiFi an unworkable concept? My earlier optimism now seems a bit overenthusiastic, but I don't think the entire idea can be written off just yet.

Remember, Alexandria received 10 bids (PDF) to run a citywide wireless network. Would all of them have gotten cold feet by now if they'd won the contract?

A bigger issue may be EarthLink itself. The company seems to be in a cash crunch overall--it's not putting any more money into Helio, the wireless-phone service it set up with SK Telecom.

If you were in charge of bringing municipal wireless to one of the two local jurisdictions, what would you do next--renegotiate with EarthLink, reopen the bidding or punt on the project?

By Rob Pegoraro  |  September 24, 2007; 11:06 AM ET
Categories:  Telecom  
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Comments

I'm trying to figure out why muni wifi makes sense. It won't be performant enough for power users. Laptops are not particularly useful outdoors, particularly in the daytime. Cell phone internet is sufficient for devices with two inch screens. So why are we doing this in the first place anyway?

Posted by: slar | September 24, 2007 12:07 PM | Report abuse

EarthLink signed the contracts. If they can just say
"oh, never mind we can't do it that way" what good is a signed contract?

Posted by: jack | September 24, 2007 12:23 PM | Report abuse

Cell-phone internet is woeful if you're doing anything that isn't purely text-based. Try working with maps, or getting text off a page that's heavy with (advertising-related) images. I'm sure it won't be long before car-based wifi-services become essential as well.

If communities want to push their to visitors then muni wifi is likely to be much more accessible and successful than private subcriber-wifi which is far less portable.

Posted by: Mike | September 24, 2007 2:15 PM | Report abuse

In 2005 Old Town attempted to show how technology forward they are by implementing "city wide" wifi. This actually only covers a small area from Union St. to Washington St. around King St. This is not tabled, waiting for the seemingly corrupt Earthlink to fulfill their contractual duties amidst their own show cited ventures.

All the while, the supposed technology forward Old Town is delaying any hopes of installation of a true local leap in internet service, Verizon FIOS, because they don't want any more wires strung up to provide the service. Are you kidding me? Has anyone ventured two blocks off of King St. to notice that cable, internet, phone, and electrical is still being provided by overhead to the majority of residences?

Apparently we are paying our taxes as Old Town residents to 1) waste on installed but disabled technology, 2) city officials that have no clue on how to hold a company to a signed contract, and 3) stonewall an additional internet and cable provider from offering a service that would cause competition and lower prices from the monopoly holder, Comcast.

Seriously, what are we paying for, def not a technology forward city, they need to be a little less delusional perhaps?

Posted by: Alex in Old Town | September 24, 2007 2:54 PM | Report abuse

The best model I've seen is in Columbus, GA. It's not city-wide and it's not run by the city government, but it works, and has done since at least 2004. More info at http://columbusfreenet.org

Posted by: Larry | September 24, 2007 3:33 PM | Report abuse

Problem with Muni Wifi is not so clearcut. but since i work in the Telecom industry, specifically in that area, i will try to explain:

1. WiFi as a technology is not going to cut it. from a technology point of view, a wifi AP will not support the necessary number of subscribers to cover a large neighborhood block. a large number of AP would have to be deployed to support that. Also the throughput start to degrade tremendously when more than a handful of users are attached on the AP. To compensate for that, solution is to deploy more AP.
2. Because of #1 above, your original business case is out the window. This has been the number 1 problem for all cities and tech componies involved in this business. They promised wifi as the free (or cheaper) alternative to terrestrial broadband. the reality is the end does not add up.
3. because of #1 and #2 above, only a few AP are being deployed as proof of concept. the problem with that is that coverage is not wide enough and performance is not adequate enough to attract or keep subscribers interest. so not enough people sign up for it or retained the service.

Wimax as an alternative wireless broadband will resolve the technical issues and help make the business case for this kind of model. The problem though is that after wifi fiasco, cities may not venture into that space any time soon. and service providers such as Earthlink or AOL have lost enough money and are not willing to venture into that space either. so here lies an impass.

Muni wireless may very well be a dead business model.

Posted by: justsayin' | September 24, 2007 3:59 PM | Report abuse

Here in the city of Luxembourg (the capitail of the country of Luxembourg)we have free Wi-Fi that works quite well, and is expanding its coverage. I do believe the city covered most of the up-front costs.

Posted by: Matthew | September 25, 2007 3:15 AM | Report abuse

whatever happened to the free Dupont Circle wireless? Is there someone to contact to find out what happened to this service?

Posted by: chick | September 25, 2007 8:19 AM | Report abuse

muni wifi is not dead yet. this is from cnet.com:
Citywide Wi-Fi isn't dead yet

By Marguerite Reardon
http://www.news.com/Citywide-Wi-Fi-isnt-dead-yet/2100-7351_3-6209837.html

Story last modified Tue Sep 25 04:00:02 PDT 2007


Despite the recent onslaught of bad press, citywide and regional Wi-Fi networks are not dead.

In fact, cities, such as Corpus Christie, Texas; Minneapolis, Minn.; and Philadelphia, are actually seeing early signs of success. And lessons learned from these deployments if applied properly could help save bigger and more, ambitious projects such as Silicon Valley's regional wireless network.

Two of the biggest lessons that other cities can take away from projects currently under way are having a clear mission and use case for building these networks and also defining a business model for building and sustaining the network.

"Cities that have seen early success have been able to articulate very clearly to politicians and citizens how the network will be used and how it will benefit people," said Craig Settles, an independent wireless consultant. "And they've also had clear business plans for paying for the networks."

In the very earliest days of citywide Wi-Fi, this appeared to be the case. Cities, such as Corpus Christie, looked into Wi-Fi to solve a particular problem. The city wanted to allow its utility workers to read water and gas meters remotely. Wi-Fi seemed like a perfect solution.
"Cities that have seen early success have been able to articulate very clearly to politicians and citizens how the network will be used and how it will benefit people."
--Craig Settles
wireless consultant

The city soon expanded the scope of its network to also enable building inspectors, code enforcers, police, firefighters and emergency medical technicians to communicate wirelessly with each other. And now Wi-Fi is also used to keep tabs on city property such as vehicles and provide remote surveillance in certain parts of the city. Earlier this year, Corpus Christie sold its network to EarthLink, which will not only provide the wireless service to several city agencies, but also sell consumer broadband services to residents for $20 a month.

Minneapolis also built its citywide network with the express intent of using it for public safety and to connect city agencies together. USI Wireless, which is deploying the Wi-Fi gear and providing the service, had only a small portion of the network built in early August when a major bridge collapse put the emergency Wi-Fi network to the test.

Within hours, the network was opened up to all users, allowing people with dual mode Wi-Fi phones to communicate without clogging the cellular network. In the days and weeks that followed, the Wi-Fi network has also been instrumental in rescue and recovery efforts around the disaster site.

Philadelphia, which started building its network more than a year ago, took a different tack. The city saw Wi-Fi as a way to bridge the gap between rich and poor by providing low-cost broadband service to disadvantaged citizens.

EarthLink, which saw citywide Wi-Fi as an opportunity to own its own network infrastructure, won the contract to build and run the network. In addition to paying for the network, EarthLink also committed to providing some funding for the city's nonprofit group Wireless Philadelphia, which subsidizes Internet service for Philadelphia's low-income households and helps provide training and equipment.

Subscriber numbers in Philadelphia have not been released, but Greg Goldman, CEO of the nonprofit group Wireless Philadelphia, said that thousands of retail customers and dozens of nonprofit groups have already begun using the network, which is still not fully deployed. One of the biggest boosts in usage came when Drexel University, which owns and operates one of the largest wireless networks in the country, added the Wireless Philadelphia service to its array of services that it offers to students and faculty.

"There's no question the ground is shifting," Goldman said. "But wireless technology isn't going away. And it provides a much needed service for low-income people. We've been very clear from the beginning of that focus. And we believe it creates an enormous market for broadband."

After Philadelphia came on the scene, expectations of citywide Wi-Fi exploded. Soon cities, such as San Francisco, were promising free wireless broadband access for all citizens funded through advertising.

Other cities quickly jumped on the bandwagon and "free Wi-Fi for all" soon became a rallying cry for many Wi-Fi deployments.

EarthLink's management soon realized that the current business model would not suffice. And earlier this summer the company said it would not bid on any new city contracts. Then last month, EarthLink started pulling out of some contracts in cities where construction had not yet started, including networks in San Francisco and Houston.

The problem that EarthLink is facing is simple. The company, which has mostly focused on providing an alternative broadband service to consumers, has not found a sustainable business model. And in many of the cities where it had hoped to provide service there was not a clear message of what the technology could bring to the city.

EarthLink's retrenchment has changed the course of the industry, at least for the moment. Cities, such as Chicago, have decided to put their Wi-Fi plans on hold while they re-examine their choices.

But others have decided to press forward. Despite some reports that it is abandoning its plans, organizers of the ambitious regional network for Silicon Valley say they are moving forward with plans to build a wireless network in 40 cities across four counties. The first two test cities are expected to be San Carlos and Palo Alto.

Still, EarthLink's problems and the spate of bad publicity are making it more difficult for the project to move forward. Silicon Valley's network was supposed to begin deployment this summer, but the project stalled as funding became scarce.

"Clearly investors are shaken by what is happening in the industry," said Seth Fearey, vice president and chief operating officer of Wireless Silicon Valley, the group spearheading the project. "And that is affecting us. But we are confident that will be able to convince people that our approach is different."

Fearey said that unlike San Francisco and some of the other projects that have been proposed, the Silicon Valley project has a different business model. The project is not looking to provide an alternative consumer broadband service in communities that are already well served by existing broadband service providers. It's also not necessarily looking to serve the municipal or public safety market by building a wireless network that is only used by the cities themselves.

Instead, Wireless Silicon Valley along with its partners hopes to create a wireless broadband network that can be used as an economic development tool. The idea is that businesses in industries, such as construction or health care, can use the network to allow their remote and mobile workers to communicate using a robust wireless network.
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And unlike other projects that have focused on Wi-Fi, Wireless Silicon Valley hopes to use other licensed and unlicensed wireless technologies, such as WiMax, to offer service throughout the region.

"A network of this size and magnitude will need more than just city contracts to sustain it," said Fearey. "Cities are a good starting point, but they can't carry the entire load, which is why we are going to industries and businesses within the region to develop applications."

While it appears that Wireless Silicon Valley has embraced a new business model, Settles said that he believes it could still be a tough sell, especially in the current climate.

"At the end of the day, a lot of the success of these projects comes down to marketing," he said. "You really have to go out there with a clear message and articulate how the network will impact people for it to be successful. And then you have to explain how you can pay for it. And that's not easy to do."


Copyright ©1995-2007 CNET Networks, Inc. All rights reserved.

Posted by: chick | September 25, 2007 8:20 AM | Report abuse

Thank you Chuck for choking us with a full article when a link would suffice...

I think WiMax is probably more attractive as a "five years from now" technology, but, for now, Wi-Fi is what notebooks and PDAs pack. I don't find the idea of a mouse-sized dongle attached to my computer appealing, even if it means I can surf the Web from a park bench.

But Wi-Fi is, admittedly, not for staying connected in a city. It's for coffee shops, where you can sit with your notebook. Other tech like UMTP and CDMA are great (for those with 3g phones) for staying connected. How many people do you really see lounging in the park with their laptop anyway? Most who insist on being connected (via e-mail, etc.) all the time have a Blackberry or other smartphone.

Eventually maybe we won't be getting our Internet from a cable or fiber-optic line, and yank it out of the air from WiMax transceivers.

But for now, being able to pull out my notebook at Starbucks and Panera Bread and surf some Web pages and stay up to date with my RSS feeds is all I need from Wi-Fi. Which is good, because that seems like it's all it offers.

Posted by: Brendan West | September 25, 2007 9:41 AM | Report abuse

Wow, I remember being in Seoul, Korea, where this town of 12,000,000 people could access wireless internet from anywhere- I even heard the city would pay you if you could find a hole in coverage.

Posted by: Shane | September 25, 2007 10:42 AM | Report abuse

I used to have an Earthlink satellite link for internet access. To give an idea of how bad they were Comcast now seems wonderful. I would not trust anything that Earthlink was involved with. So I suspect the problems with free Wifi are down to Earthlink rather than the concept. If Google can prosper with targeted ads I don't see why Wifi cannot.

Posted by: Ian | September 25, 2007 12:28 PM | Report abuse

That is really frustrating news. I can't get DSL (or satellite or FIOS for that matter) in my apartment building in Old Town Alexandria, so I was hoping the city-wide network would pan out this fall. I'm sick of paying $45/month to Comcast when "slower" DSL or city-wide wireless would suffice for my needs. Too bad dial-up would be way too slow and I'd still have to pay extra for a land line.

Posted by: Alex | September 27, 2007 2:04 PM | Report abuse

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