The San Francisco Chronicle reports from Taipei that the city-wide Wi-Fi network is far short of coverage, subscribers: Though its launch was promising, and early tests of coverage found it quite good in outdoor areas, subscribers are scarce. Q-Ware, the firm that bore the risk and built the Wifly network, sees 30,000 average monthly users (20,000 monthly subscribers, 10,000 limited pass users) short of what the Chronicle says was the 250,000 average monthly users predicted for the end of 2006. The company said it needs 200,000 regular users to break even. Taipei's population is 2.6m.

Even the city government has been underwhelmed, signing up for just 1,000 of the 3,000 accounts that they had initially expected to purchase.

While 90 percent of residents are covered with 4,200 nodes deployed, coverage and speed are inconsistent according to the reporter's experience and residents he spoke with. Q-Ware will double its nodes this year--8,400 nodes over 52 square miles would be an incredible density, almost a factor of four above networks built in the US. But it seems like Q-Ware wants to avoid requiring indoor repeaters; they've given away 1,000 such bridges so far.

Q-Ware has a number of other initiatives, including doubling network speed from a paltry 500 Kbps average to 1 Mbps, at which point it might compete with 3G cellular that's in use on the island; partnering with Sony for PSP gaming access; and personalizing the Taiwanese equivalent of YouTube (I'mTV) for better mobile user results.

As with other early large networks, it sounds like the curve for adoption is much steeper and user expectations are much higher than expected. Q-Ware's plans mean a substantial increase of capital expense from the $30m planned. 4,200 additional nodes will cost as much as $10m to $15m, exclusive of mounting costs.