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July 26, 2005

Qualcomm Founder on Muni-Fi, Metered Wi-Fi

Qualcomm's founder's opinions can't be discounted, since he created and controlled an entire industry: He says municipal Wi-Fi is poorly thought out and competes using tax funds with private enterprise. That just shows he isn't reading the stories, but is reading briefs for those with vested interests. Newer and larger proposals from cities now protect taxpayer dollars, and some of those ventures will pay tax rather than be tax free. Some existing municipal networks already pay their full tax burden using money that didn't come from tax-free bonds, too. He also adopts the patronizing tones of private enterprise for government, assuming that poor stupid government can never actually execute.

It is interesting, though, that he believes metered rates for Wi-Fi will disappear entirely in favor of unlimited plans. I have believed that for years, but T-Mobile's apparent success with a portion of their network being available on an unlimited use basis with roaming always charged per use seems to contradict my belief.



When you dig into the details on Muni Wireless, be it a Philadelphia, Rhode Island, or my guess even the announcement you posted for Miami Beach, it is clear that many of these municipalities are only now coming up on the learning curve on what it takes to deploy, operate, and maintain a mobility data system. It's non-trivial.

At the same timeframe as certain hotspot folks have announced that they had 1M folks connect in a month, with very vague details, we have Verizon announcing this week that usage from 19 MILLION wireless data customers contributed $483M in revenue in their last quarter, and Sprint announcing today continued rapid sequential growth of wireless data usage and over 8 MILLION wireless data users. And this is just the beginning, as Sprint has announced deployment of 1xEV-DO, and Cingular is deploying WCDMA. These folks are spending billions and untold thousands of man years to get systems that function, on a massive and ubiquitous scale. And they are succeeding.

I work in a city that has a hard time getting a mayor elected, has pension problems, school problems, and massive fiscal problems. Like many cities, there are significant issues. And they are going to become my IT provider for Wi-Fi or 802.16e (whenever that comes along)? Over hundreds or thousands of square miles? For mobility coverage with QOS acceptable and relaible Fire and Police departments at some 'budget' cost? I'm not holding my breath.

Jeffrey Belk
QUALCOMM Incorporated

Fundamentally, you're assuming that every city is going to install a network on their own without the experience gained by the cellular and other wireless data operators over the last decade, including those deploying EVDO and other flavors.

In fact, many of the early respondents for public-private partnerships -- partnerships that an FCC report encouraged for the broad spread of broadband access to a greater percentage of US homes and busiensses -- are the companies you're talking about.

It's hard to read the statement you make and reconcile that with Verizon Wireless's interest in bidding on proposals in various cities. It's also hard to reconcile it with the fact that the vast majority of cities and towns that are now operating networks and planning to build them are relying on exactly the hard-won knowledge of firms that have already built wireless networks.

So let's not pretend that your poor city -- and, wow, do I have sympathy for you all down in San Diego -- is representative of how governments are run. Philadelphia's plan is ambitious and experimental, and yet they received significant numbers of bids that meet close to the initial cost projections and involve multi-billion dollar companies with wireless experience.

The same will be true in Minneapolis and elsewhere.

Let's not pretend that the guy that empties your garbage can will be installing and running service. Although that guy (mine smokes a stogie while emptying the can) might just be really into Wi-Fi and running it at home.

Rather, private enterprise is deeply involved in building out these services.

Let's also remember that telephone companies have received billions of dollars in subsidies for services that have sometimes not been delivered. There's good documentation in Pennsylvania about money given above board to Verizon for services never installed; the latest telecom bill that started this kerfuffle gives them billions more through incentives to fulfill something like the originally promised plan.

Finally, what's interesting about building an IP-based infrastructure -- one that is almost certainly going to be part of whatever 4G turns out to be -- is that it's much more easily upgraded. If you build a fiber and copper backbone to feed access points and use mesh to distribute some of the service, then you can swap out the mesh nodes or supplement them as new technology is introduced.

I, for one, believe that mobile WiMax/802.16e is probably a 2007 or 2008 deployment for carrier-grade installations with certified equipment. But I am completely behind suggesting that cities and towns wait briefly for certified WiMax equipment to appear for the distribution of service to nodes throughout a town. Certified WiMax will be a much more cost effective way to handle the problem of the pipes for a broadband-scale metro network.

As far as fire and police: just remember CDPD. That worked oh so well. Well, it did. I'm not blaming the cell operators for pushing CDPD or for trying to end offering it. But you have fire and public safety officials needing to upgrade to a modern system, and secure mesh Wi-Fi networks are the only reasonably cost effective and reliable way to do it. Cellular data networks don't offer the degree of control, flexibility, capacity, and price compared to Wi-Fi mesh.

If you're suggesting that public safety folks are leaping into Wi-Fi mesh without extensive testing, I'll be happy to point you to many, many articles with police, fire, and safety officials talking about the stress testing and rollouts of their system and how effective early systems have been under stress.