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Citywide Wi-Fi goes bust

Posted May 14 2008, 02:06 PM by Kim Peterson
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Citywide Wi-Fi networks sound like a fantastic idea. Take your laptop with you to the park or the grocery store. Drop your home Internet connection. Look up directions in your car (parked, of course). More than 150 U.S. cities planned to roll out municipal Wi-Fi at one point, but the reality is setting in: these networks don't work.

Latest case in point: EarthLink, which is shutting down its Philadelphia Wi-Fi network in 30 days. Earthlink even tried to give away the network, but couldn't reach a deal with anyone. Too bad for EarthLink, which plunged deep into the municipal Wi-Fi business when its dial-up revenue fizzled. Shares dropped after the announcement, but have climbed nearly 3% today to $9.36.

Why do these networks fail? The business model is unworkable, suffering a triple whammy of costly equipment, a lack of interest and better technology on the horizon. Networks in cities like Houston can cost $50 million to build. People simply haven't signed up, either, choosing instead to stick with cable or DSL for Internet access. And a new technology called WiMax promises fast wireless access over a range of several miles -- access that's more reliable than the spotty service many city Wi-Fi networks offered.

Was there a realistic investment bet in there? Yes, but perhaps unforeseen was the unproductive pairing of big business and municipal governments. Bureaucracy, politics and cost overruns dragged these projects down.

One of the most noble goals of municipal wireless networks was conquering the digital divide. Bringing free, or at least cheap, Internet access to low-income families. Opening the Web to all. But a check around the country shows that citywide Wi-Fi is slowly dying. San Francisco's plans collapsed. EarthLink is shutting down its New Orleans network, and will hand over others to their respective cities in Corpus Christi, Tex., and Milpitas, Calif. Anaheim may be the next to go.

That's not to say that every muni network is a failure. Minneapolis' network is successful, albeit slow, and was crucial during last year's bridge disaster. These networks may be a solution for some cities, but they don't hold the same promise anymore.

Comments

 

Tired of Robinhood.......what dose your comment have to do with the price of rice in China???????

People are Greedy these days thats why I'm glad I gave away 15 million of the 30 million dollars I won. Heck I can put just 1 million of that in the bank and live off the interest for the rest of my life, my kids lives, there kids lives, ect.

Your so WEAK!

Free WiFi is becoming a reality at the city of Riverside in the state of California.  Come visit us; http://www.SmartRiverside.org

The fault lies squarely with the communities who had the audacity to think any business would come in and invest millions of dollars on the come...with ZERO real investment from the communities themselves.

The consultants who promoted the business model were out of their minds. And poor Earthlink was the ONLY company desperate and foolish enough to step up to the proposition...and look what it got them. My company and all the others refused to invest millions to offer FREE services...becasue we have business sense. WiFi works great in urban environments...IF users are willing to pay for it.

If a big corporation can't make money, it must be local government's fault, right?  Wrong.  The author blaming this on local government is just plain silly.  The reason it fails is because the marketing failed, and more importantly, setting up facilities over hundreds of square miles is a technological nightmare -- too expensive for too little economic return.  The only jurisdictions where it has worked are microscopic in scale (e.g. Foster city with only 4 square miles).  People assume it is government stopping it -- and yet governments give away the rights to install these facilities all over the public properties for free (or nearly free), and even with that subsidy the programs fail.  Hmm.  Maybe it is the program, and not the government.

I really hope that this nation wide WiMax catches on.  Just think how many jobs it could eliminate and how much gas and space it could save when everyone does their shopping, banking, selling, communicating, and work online.  It's not a utility.  In a consumer driven economy, it is the business who must provide the consumer with the ability to consume.  What better way to provide that ability than to put it at your fingertips.

Can't be done?  Anyone who belives that has never been to (South) Korea.  In addition, cheap hotels there have computers in the room, with instant internet access - no charge.  Train station storage lockers are accessed by fingerprints.  It's all about the infrastructure:  People first, money second.  That doesn't happen in the US.

Well I am in Cumberland, Md and we have a state of the art WiFi for free !!! It is here to enhance the community and attract business to our post industrial city...It is excellent, as i am up a hill with a 300 foot elevation, and 1.5 miles from downtown and get an excellent signal, now that the system has been further enhanced. This is paid for by the city, and I believe is and will become an even more so essential part of the business and social life in our beautiful town. It is free, and along with my MagicJack USB phone save me a tremendous amount of money...now it is my responsibility to make this tool offered to me for free to turn me into an even better citizen, by being productive (blows dial up away, same as my past DSL, and cable connections as far as speed goes) and an asset to this community...check www.allconet.com and look up the specs on the WiFi system...talk to your local city/municipality, and turn them on to this system...it works best and will become a mainstay of the local infrastructure...be proactive...write a letter to your local editor, write your mayor, congressman, and senator...email them all...let them know why this is an essential tool of the future and what it will do for us all...less time at work because we are more productive translates to better wages and more time with family...less work for the cops, and peaceful times...we all need to make this a better world, and when something like WiFi comes along and enhances our lives, save us money, and increases our productivity, I think the argument is simple to make...so write those letters...may be expensive as all relatively new technology, however, as with all technology, the longer it is in the market place, the less it will be and the further it will be enhanced with spin off tech and new compatible products...so again...I urge you to take a pro-active stance and start writing those letters to your local and state reps...Peace : )...I am on WiFi right now !!!

At the end of the day here is the biggest challenge...the 2.4 Ghz frequency is so high it has a tough time penetrating into homes, buildings...etc.  The frequency challenge can be overcome - but it requires more power and more strain on  battery life.  The lower frequencies similar to what AT&T or Verizon use - 850 Mhz do a great job of blowing through the walls of buidlings and homes.  iI am as user of wifi in my home...and guess what it works great in about 50% of the home...who on earth thought the technology could support major coverage within metropolitan areas?

I agree with a previous message posted by "Troy".  There needs to be more publicity as I am pretty sure I would be interested in this service, if only I would KNOW about it....

agree - have been wondering why WiMax has not taken off

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