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Municipal Wi-Fi isn't dead yet

After several failed attempts, cities are rediscovering the potential of municipal Wi-Fi networks.

TEXT OF STORY

Kai Ryssdal: Two years and $17 million later, wireless Internet in Philadelphia's scheduled to expire tomorrow. The city had grand plans for what it hoped would be a national model for what's called municipal Wi-Fi, high-speed Internet pretty much anywhere in the city for a fee if you could afford it, free if you couldn't.

But Earthlink, the Internet Service Provider that won the contract, couldn't get the numbers to add up in a way that would make 'em money on the deal, so tomorrow, it's going to pull the plug.

But Marketplace's Stacey Vanek-Smith reports the promise of free municipal Wi-Fi isn't dead yet.


Stacey Vanek-Smith: It's a sunny day on the Third Street Promenade in Santa Monica, California. The popular outdoor shopping area is packed with musicians, skateboarders and shoppers, and everywhere you look, people are on their laptops.

The city offers free Internet access here. Law student Bud Jerke says that's why he came.

Bud Jerke: Yeah, I'm doing e-mailing, g-chatting with friends, instant messaging...

This was supposed to be the scene in cities like Philadelphia, San Francisco and Portland. They all teamed up with private companies to blanket their cities with Wi-Fi. The idea was to give low-income residents free access to the Internet and attract businesses. One after another, the projects failed.

Craig Settles: It was building a model on shifting sand.

Consultant Craig Settles works with cities to develop municipal Internet systems. He says the problem has been the business model. In Philadelphia's case, Earthlink covered the cost of setting up the $17 million network and charged a nominal fee for the service. The company was counting on advertising to recoup its investment. It also planned to raise rates eventually, but, Settles says, the plan cost too much and brought in too little.

Settles: Ultimately, the vendor has to make money for what they've sold to the community. I mean, anyone who says, "This should be this benevolent thing that the city does," well, that's great, but somebody has to pay for that.

Under the new Wi-Fi model, cities like New York City, Corpus Christi and Oklahoma City start small, using the Internet for municipal business where it can reduce cost before rolling it out to the public. They're also investing in their own systems. Santa Monica spent a half-million dollars to build its own fiber-optic network about five years ago. It's using its system to do things like synchronize traffic lights and cut down on legwork for police officers and other public employees.

Jory Wolf runs Santa Monica's system.

Jory Wolf: We were able to take that network and the $500,000 investment and almost make our money back in year one. We've saved a bundle of money.

And made a bundle. Santa Monica leases its fiber optic network to businesses at lower prices than private companies offer. Wolf says that's bringing new business to the city. So is free public Internet access.

Wolf: At first the public Wi-Fi piece was going to be sort of like a giveaway; we didn't really see it as integrated in with our entire solution. But then we saw how important getting businesses to buy in.

And the incentives for businesses are growing now that most consumers have gone wireless with iPhones, BlackBerrys and laptops.

Glenn Fleishman is the editor of "Wi-Fi Network News."

Glenn Fleishman: Four years ago when everyone was talking about putting Wi-Fi across the city, it was not that compelling. But today, it's a network for these purposes and a network for these devices.

Fleishman says free Wi-Fi can draw people to areas where they'll spend money at local businesses. He says that could encourage more cities with municipal broadband to go public.

Back on the Third Street Promenade in Santa Monica, law student Bud Jerke and roommate Jason Rize work their laptops over coffee at a local cafe where they plan to become regulars.

Jerke: I'm just here for the summer, so I don't really want to sign a contract for a plan. I don't really have the money for it.

Jason Rize: Makes you want to come back here.

In Los Angeles, I'm Stacey Vanek-Smith for Marketplace.

About the author

Stacey Vanek Smith is a senior reporter for Marketplace, where she covers banking, consumer finance, housing and advertising.
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My name is Pierre Clark. I'm co-founder of the Chicago Digital Access Alliance (http://www.digitalaccessalliance.org) and Chicago's Southside Technology Cooperative NFP. We were instrumental in working with a mayoral advisory board organized around a wi-fi network bid in Chicago which was responded to by Earthlink and AT & T. The city chose not to accept either of the bids to deploy the wi-fi network. It's interesting as Michell Morton notes that a partnership involving One Economy and local community groups on Chicago's West Side has developed and revitalized a wi-fi network. We're launching another wi-fi network on Chicago's South Side and One Economy is working with us. The business model for community-based networks that deliver services and content is proven as respondents to this thread are demonstrating. We're already talking with other communities in Chicago about deploying wi-fi networks and in the state of Illinois there may be as many as 40 community-based networks. If companies work in partnership with community groups in building and deploying networks designed to meet community needs, it's our view that business model can be successful.

I am a program director for One Economy, a nonprofit that uses innovative approaches to deliver the power of technology to the low-income user. We are working with communities across the country and globally to develop 21st century communities. In some of these communities we promote free and low-cost wireless access. In Chicago, the Motorola Foundation is funding a community wireless network in the North Lawndale neighborhood (www.lawndalebeehive.org), which will provide free and low-cost Internet access. As we expand our wireless network in North Lawndale from 400 users to 2,000, we want to ensure that there are programs, training, and content available to this neighborhood. I think it is extremely important that municipal and community wireless networks provide programs and/or content to engage underserved populations. One of the issues we will focus on is economic development, in particular employment and small business development. Our local partners and One Economy want to create: a sustainable; scalable, and replicable network that not only connects people to the Internet, but to resources that could change their lives.

I am a program director for One Economy, a nonprofit that uses innovative approaches to deliver the power of technology to the low-income user. We are working with communities across the country and globally to develop 21st century communities. In some of these communities we promote free and low-cost wireless access.

In Chicago, the Motorola Foundation is funding a community wireless network in the North Lawndale neighborhood (www.lawndalebeehive.org), which will provide free and low-cost Internet access. As we expand our wireless network in North Lawndale from 400 users to 2,000, we want to ensure that there are programs, training, and content available to this neighborhood. I think it extremely important that municipal and community wireless networks provide programs and/or content to engage underserved populations. One of the issues we will focus on is economic development, in particular employment and small business development. Our local partners and One Economy want to create: a sustainable; scalable, and replicable network that not only connects people to the Internet, but to resources that could change their lives.

Our Municipal WiFi network here in Lawrence Kansas [ http://www.lawrencefreenet.org ] is going strong. The non-profit is serving over 100 low income families and the network serves as the primary internet connection for about 1200 households.

The project in Lawrence has rec'd no funding from the city, however, the city made water tower access available at a significantly reduced rate.

Santa Monica shows how much the city can benefit if they participate in the project, maybe the City of Lawrence will take a queue from forward thinking communities like Santa Monica.

Joe, Brick and Mortar requires space... that means you need to tear down part of the community you are trying to serve.... WIFI works with the existing urban fabric and can be maintained without the need for major staffing to serve a much larger shed area.

It would be AMAZING if we can get this going citywide! My complex shares a network and we all pay $3 (volunteer). The Gavin (Mayor of San Fran) said that he can't dedicate city funds (at this time) to implement such a citywide program, but he encouraged arangements such as the one my complexmates and I have.

Internet access is critical, and those with limited income need to connect with the technologically advancing world or they will be left FAR behind.

**A rising tide lifts all ships**

I'm curious as to how the costs to a municipality of providing free WiFi for a community compares to the costs of providing a brick and mortar library which would serve the same number of people. Free WiFi does not provide the exact same service as a library, but the underlying principle -- providing free access to a wide range of information -- seems the same.

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