Category: Municipal

May 9, 2008

Can Azulstar Make WiMax Work without Buying Spectrum?

By Glenn Fleishman

Azulstar once pinned its fortunes on city-wide Wi-Fi, but now looks to a special licensed spectrum band to make WiMax work where Wi-Fi failed: Azulstar has been the also-ran in Wi-Fi for some years, I’ll just state bluntly and upfront. They built a network in Grand Haven, Mich., in 2003 that’s one of—if not the—longest running metro-scale Wi-Fi networks in the world designed for public access. The mayor of Grand Haven since 2003, Roger Bergman, told me, “I got on board personally right away, and I am still on.”

Azulstar soon answered several RFPs and partnered up with major firms to bring Wi-Fi to Rio Rancho, N.M., Winston-Salem, N.C., Sacramento, Calif., and most notably Silicon Valley—a set of dozens of cities along with county government and private enterprise all wanting some kind of tiered Wi-Fi across 1,500 sq mi.

While EarthLink, MetroFi, and even Kite Networks (with their extensive Arizona buildout in Tempe launched a bit before any other large competiting network) seized the headlines, and later made news about their stalls, failures, and exits, Azulstar seemed quietly to sink into the sand. The Wireless Silicon Valley deal fell apart, as did Sacramento after efforts to get stakeholder and outside investment seemed to fail to materialize, and the marquee partners—Cisco, IBM, and Intel—just wouldn’t step up to the plate to make the project move forward. Azulstar was the lead techology firm, but the money just didn’t come. (Both California projects are moving forward with a different set of partners and expectations now.)

Rio Rancho was perhaps one of the biggest letdowns. City manager Jim Payne explained in an interview a few weeks ago, “They had a number of things that were going against them from the start, and they did make an attempt to meet the requirements of the contract.” But Rio Rancho voted to not just terminate the contract after years of attempts to make the network work, but rejected a proposal from Azulstar a few weeks ago to switch over equipment on the poles. Azulstar now has to remove all its devices.

All of this might make the typical company head a bit depressed about his firm’s future, and less than sanguine about the potential for wireless broadband to work at all. Not so for Tyler van Houwelingen, Azulstar’s chief, and I have to admit that he convinced me that the wireless provider has a fighting chance, due to a good combination of timing, spectrum policy, and a large dollop of can-do spirit.

Continue reading "Can Azulstar Make WiMax Work without Buying Spectrum?"

Posted by Glennf at 10:58 AM | Comments (0)

May 7, 2008

Buh-Bye, Philly

By Glenn Fleishman

Metro Philadelphia is reporting that the city’s Wi-Fi network may halt operations as soon as tomorrow, 08-May-2008: The site reports that EarthLink stopped accepting new customers last week, and told Philadelphia that without a plan by the city to assume control of the network by tomorrow, it would start dismantling the network, after a previous deadline set for last Wednesday passed. EarthLink owes the city a $1m payment on May 23, the site reports.

Posted by Glennf at 10:33 AM | Comments (0)

May 1, 2008

Colorado Communities Consider How to Move Forward

By Glenn Fleishman

Colorado communities consider whether to move forward with vendor: 10 communities put together a joint RFP to allow a single firm to work across the entire area outside Denver. However, C-Com reportedly has not been able to obtain the funding necessary to the build the network. Despite the communities working together, they did not offer anchor tenancy or any service purchase guarantees. This makes the proposal unworkable in today’s climate, and it’s astounding that any firm would agree to such terms, even last year. E-Path is going through similar difficulties in Long Island, New York. Due diligence by investors will lead to sites like mine and Muniwireless.com, which will tell hundreds of stories about how networks that lack municipal service commitments appear to be unworkable and unsustainable.

Posted by Glennf at 2:31 PM | Comments (0)

April 25, 2008

EarthLink Shutters New Orleans, Staunches Own Losses

By Glenn Fleishman

The Big Easy gets a big loss with EarthLink’s pullout: InformationWeek reports that EarthLink attempted to sell the network, get the city to buy it, and then to simply give the network (and its obligations) away, but had no takers on any front.

EarthLink announced its most recent quarter’s earnings a few days ago, and they managed to turn a GAAP profit, while staunching the bleeding of so many businesses that had no short-term and seemingly little medium-term potential for net revenue. The company dramatically slashed its marketing, which they found only caused subscribers to join and quit. While revenue dropped from $290m to $235m year over year in Q1, operating costs and expenses were cut from $321m to $198m, with the most noticeable drop in sales and marketing ($99m to $31m) and operations and customer support ($60m to $39m). They recorded $58m in earnings versus a year ago’s $22m loss.

Employees dropped from 2,108 to 922 during the period, while subscribers dropped from 5.7m to 3.6m. But it’s worth noting that the biggest drop happened last year already: the 31-Dec-2007 subscriber count was 3.9m. They’re making slightly more money from each of those remaining customers, and have slightly lower churn. Their municipal write-off is lower, too, as they’ve taken most of the expense, and have offloaded more and more of their future obligations.

The company still has the same problem that it had before it started unwinding its services beyond dial-up and broadband: None of its markets are expanding, and it has increasingly poor access to reasonably priced broadband to resell to customers, as no cable or DSL providers are obligated to provide true wholesale rates.

Posted by Glennf at 3:52 PM | Comments (0)

April 20, 2008

Dead, Dead, Dead: Cities Accept Muni-Fi's Absence

By Glenn Fleishman

Local paper taunts Tempe’s failed muni-Fi effort: Symbolically, a display celebrating the kickoff the city-wide Wi-Fi network built by NeoReach-cum-Kite-cum-Gobility is falling apart in front of the mayor’s office, the reporter notes. I have to add “stucco” to the list of quotidian problems that tripped up metro-scale Wi-Fi. In many parts of the U.S., stucco isn’t in a homeowner’s vocabulary. But in large swaths of sunny states, especially the southwest and southern California, homes are finished by slapping plaster on chicken wire and calling it good—it’s got good insulation. Where wallboard over balloon wood frames doesn’t really obstruct Wi-Fi, the chicken wire coupled with the density of the plaster is as effective as the water always present in brickwork in keeping signals out. I had this conversation recently about plaster with Rio Rancho’s city manager, too.

The reporter notes other common threads of problems with metro-scale networks: lowballed budgets, which turned out to underestimate infrastructure costs (nodes, real-estate rights, utility pole issues), low demand, and weak signals inside homes. Tempe apparently had 1,000 subscribers at one point, in a city of 166,000 (2005 census estimate).

The articles states, “The upside is Tempe and other Valley cities didn’t spend taxpayer dollars.” Of course, as I’ve noted before, the idea with a wireless network should be to both conserve expenses and reduce them. “Taxpayer dollars” is a shibboleth of those who believe government can solve no ills. Those who believe that are typically also fine with government overspending by paying large companies as private contractors rather than working in a public/private partnership that reduces expenses and yet puts most dollars into the private sector—just in smaller firms.

Gilbert, Ariz., one of several Arizona cities that was contracted with Kite, reaches fifth stage of mourning, acceptance: Gobility, Kite’s ostensibly current owner, hasn’t communicated with the city in two months, and its elusive head wouldn’t comment for this article in local paper. The city isn’t too depressed.

Oklahoma City is OK with lack of Wi-Fi network for public access: They’re pretty pleased with their large mesh network for emergency services.

Posted by Glennf at 12:54 PM | Comments (0) | TrackBack

April 15, 2008

New York Times Taunts Long Island Effort, E-Path

By Glenn Fleishman

The New York Times editorial board says nyah-nyah to Long Island’s Wi-Fi network: The editorial posted on the Times masthead blog, The Board, notes that a “no-name” company with “no track record” was awarded a contract, and that citizens shouldn’t worry because “the government wouldn’t be spending anything.” (The Suffolk County executive Steve Levy was quoted by the Times in August 2007 saying precisely that: “No taxpayer dollars will be spent.”)

The money grafs in this article: “No tax dollars, no risk, no problem. Now it looks like no wi-fi, either.”

As I, Craig Settles, Esme Vos, Craig Plunkett (a local wireless provider), your crazy uncle, and John McCain could probably have all told you (and many of us did), a $150m network from a firm that hasn’t built such a network, with no municipal commitment for the purchase of services means no network will be built. I’m not saying that Wi-Fi is the answer or any answer, but it’s become clear that if a city can’t move some of its dollars from one vendor to a Wi-Fi provider in order to secure service, there’s no way a network gets built. (See: everywhere.)

Taxpayer dollars are already being spent on incumbent services for voice and data. Moving expenses from one firm to another is only a risk if there’s a cost involved that can’t recouped, and if the city is on the hook for services if a network goes defunct. That can happen, and has happened. But it’s a different issue than spending “taxpayer dollars.” In fact, through better controls and more efficiency, spending on wireless broadband of all kinds (Wi-Fi, public safety 4.9 GHz, WiMax, and cell data), fewer taxpayer dollars could be spent or more services obtained. Think about police officers being in the field 10 percent more per day if they can file reports from the field, electronically. It’s been shown to help in cities that have tried this even with older wireless systems.

The Times editorial board isn’t content to ridicule the potential deployment, however. They note that directory services lacks a listing for E-Path, that no phone number is on the company’s site, and that email to the four principals isn’t responded to—except a bounce message from the COO who apparently left the firm on 14 April 2008.

I’d also note that the company must have seen my post on the similarities of their logo to the Internet Explorer icon. The new logo is entirely different, and new in the last few weeks. (See inset figure.)

Posted by Glennf at 10:53 AM | Comments (0)

April 14, 2008

Corpus Christi Cuts EarthLink's Cord

By Glenn Fleishman

The city council of Corpus Christi will move Tuesday night to resume control from EarthLink of its Wi-Fi network: The network was originally built by the city to support municipal purposes, such as meter reading, and was sold to EarthLink for $5.3m plus $340,000 in other revenues, the local paper reports. The sale was reported back in March 2007 as a way for the city to gain better coverage without investing their own money and recoup some of their expense. EarthLink did complete the network in August, but its future—like all of EarthLink’s municipal efforts—is completely uncertain. EarthLink is likely to sell, shut down, or abandon all its municipal networks based on statements over the last several months.

Corpus Christi, if it resumes ownership of the network, wouldn’t operate ubiquitous public access Wi-Fi, however. It would focus on nine areas of free service currently in place, which could expand in the future; municipal uses would continue.

EarthLink would avoid paying $1.59m remaining in its contract, but the city would get improvements that total $1.76m, as well as $830,000 in additional equipment that were used in building out the network. Yearly operating costs are reported here as $50,000, which seems insanely low. Perhaps with only municipal purposes, there’s no backhaul cost. But radios die and equipment needs to be moved. I would expect a cost in the hundreds of thousands for a 147 sq mi network.

Posted by Glennf at 3:46 PM | Comments (0)

Metro Round-Up: L.I.-Fi, Sebastopol (Calif.), Wired Muni Map, OpenAirBoston

By Glenn Fleishman

Dubiousness on future of Long Island project: Long Island network builder E-Path has lost out in Trenton, where it asked for a mere $250,000 in contracted services to build a 7.5 sq mi network; Delay Beach, Flor., hasn’t progressed, either. Trenton’s business administrator states the problem clearly: “You can’t expect a company to come in and expend millions of dollars on build out costs without having some level of guarantee that they’re going to recover their costs.” But there’s more problems with E-Path in Long Island, where the utility that needs to grant pole access for two pilot projects says they gave access months ago. We’ll see what shakes out. I was dubious from the start about the scale of the project with no anchor tenant, and with a firm that had no comparable projects of scale even underway. It’s not a lack of confidence in E-Path (I have no opinion on their abilities); rather, the state of financing for projects of this sort.

Extremely fair article on Sebastopol Wi-Fi networking health debate: The local paper manages to push the camel through the eye of the needle in presenting various aspects of the vote by the local council to rescind the gift of a local ISP to provide city-wide Wi-Fi. It neither ridicules the symptoms of people who describe themselves as electrosensitive, nor ignores the clinical research that shows such sensitivity to be unprovable, even as the symptoms are clearly manifest (just not correlated with EMF). The article notes that one radio host who speaks on health has his words carried by a station that is bumping more signal out across Sebastopol than any Wi-Fi network would. In a true Sonoma moment, however, the leading opponent to the city-wide network and the owner of the ISP cross paths in front of Whole Foods where high school students in favor of the network were gather signatures for a petition—and hugged. That kind of behavior is more of what we need: civility, understanding, and mutual working forward to improve everyone’s health. More research? Sure. And more kindness, too.

Wired’s Wi-Fi map: now, useful! My friend and colleague Cyrus Farivar spent weeks researching what municipal projects were proceeding, on hold, or dead across the U.S., and I wasn’t very impressed by the way in which Wired presented this material in their print issue. But never fear! Online, paired with Google Maps, his research is tremendously accessible. It’s now a few weeks out of date, but still useful for the scope and locations of projects. It makes me want to build an ongoing effort of the same kind!

Complimentary essay on Boston’s pace: By not building fast, OpenAirBoston avoids the mistakes of other municipal networks. True. But in the end, they need to build something; they are only “behind” in the sense of not having put their neck out too far.

Posted by Glennf at 11:12 AM | Comments (0)

April 12, 2008

Metro Round-Up: St. Louis, Minneapolis, Tempe

By Glenn Fleishman

St. Louis’s downtown Wi-Fi network goes live: AT&T overcame the problem that led them to cancel a city-wide Wi-Fi network—a lack of 24-hour-a-day power on utility poles—by building just a square mile out with nodes placd on traffic lights. The lack of power is rather difficult to overcome, and traffic lights are spaced too sparsely to replicate this deployment city-wide. AT&T is offering free, ad-supported 512 Kbps service and paid 1 Mbps. This seems rather paltry given the 72 access points that the reporter told me were being placed across that square mile. (That number is what led to my estimate of at least $500,000 in cost in the first year.)

BelAir’s radios praised in Minneapolis deployment: Okay, they’re praised mostly by BelAir and its customer USI Wireless. That’s buttressed by details from a Novarum survey of the city that was done before the network was complete over a limited area.

Tempe moves to cancel Gobility’s contract: The city could choose to take ownership of the network, but has opted for canceling the service, which would lead to other steps. This article notes that Gobility isn’t communicating with city officials, but then a city official states late in the article that Gobility is still looking for a buyer for its assets.

Posted by Glennf at 9:15 PM | Comments (0) | TrackBack

April 4, 2008

Boston Moves to Bubbles of Access

By Glenn Fleishman

The term “hotzone” is passé, apparently: The Boston Globe reports that efforts to build a city-wide Wi-Fi network in the cradle of liberty have faltered, with only hundreds of thousands of dollars towards a $15m goal raised; a retailoring of plans for more modest, inexpensive pilots; and the potential departure of the volunteer CEO in favor of a paid leader.

Still, I don’t think it’s a bad idea to retool: with no money on hand, with no commitment from the city, with the first pilot in place, rethinking the project as a series of lit-up areas makes just about as much sense as anything; cf., Houston.

The article notes that the company is switching from the BelAir equipment to free software installed on off-the-shelf hardware. There’s no such product that I’m aware of that could scale for these efforts. There’s off-the-shelf and commercial, paying for the management part (RoamAD); off-the-shelf and sort of open, but not commercial without paying for it (LocustWorld); open-source based but proprietary hardware (Meraki); proprietary all around, even if it has open-source components (BelAir, SkyPilot, Cisco, Motorola, Tropos, etc.); Roofnet (various components, but the team is now mostly working at Meraki); free, open-source, and open hardware (CUWiN, seemingly in abeyance).

So…what are they using?

Update: Stephen Ronan writes in to suggest it might be OLSR or Open-Mesh. (Open-Mesh, the company, uses RO.B.IN, a full-blown firmware package for Atheros AP51 devices that stands for Routing Batman Inside; B.A.T.M.A.N. is an algorithm: better approach to mobile ad-hoc networking; B.A.T.M.A.N. is also instantiated as software that can be installed on appropriate Linux-based routers. Holy flash memory!)

Posted by Glennf at 9:53 AM | Comments (0)

April 3, 2008

Mobile Post: Speeds Thrills in Minnesota

By Glenn Fleishman

In Minnesota, St. Paul and Minneapolis may stand as poster children for two trends in broadband: On your left, Comcast offers 50 Mbps/5 Mbps in the home; on your right, a working urban Wi-Fi network.

Posted by Glennf at 2:53 PM | Comments (1)

March 31, 2008

Toronto Columnists: City Owned Exclusive Broadband a Good Deal

By Glenn Fleishman

Scary idea to force Torontonians to implement universal broadband, even to those with broadband: I’ll admit I don’t understand Canada as well as I should, but this column in the Toronto Star advocates public ownership of broadband in the city that would supplant all privately supplied broadband to homes. I’m not kidding. Toronto Hydro is considering selling its telecom division, which includes its well-engineered but limited One Zone service (6 sq km of downtown).

This op-ed recommends that the city buy the division, and have it build service, which they estimate at about $100 per household, which could save $300 to $400 per household per year for those with broadband. But that means that they prefer any market for broadband to be destroyed in favor of a publicly owned and operated network. Which, frankly, would scare me if such a thing were proposed in my city.

It’s not so much that any given broadband firm is so marvelous that I wouldn’t prefer another. (I am surprisingly happy with my DSL from incumbent Qwest, including their fantastically improved technical support.) But, rather, that cities seem to do best in ensuring that missing pieces of all kinds are provided to those least able to advocate for themselves. This, in my mind, extends to cities providing incentives for supermarkets to be built in disadvantaged areas. (There’s always an irony that people least able to afford food must travel the furthest to obtain food at prices below that offered in their neighborhood, typically through convenience stores. That’s changing.)

One prominent argument that I found myself agreeing with when the discussion of municipal Wi-Fi was in its infancy was the problem of building a broadband network that used taxpayer dollars to improve the lot of some citizens, often those who could afford a variety of broadband options. Plans that used city budgets to reduce costs for telecom or provide municipal services are more egalitarian, and seem to have won the day.

In this case, the op-ed writers are suggesting a course that would eliminate all competition. Can anyone trust their city well enough that they support starting a bureaucracy that would completely de facto (not de jure) prevent any better service from being installed? Or that would require you to pay as part of your taxes for service that you wouldn’t use?

The columnists do more sagely suggest that a “city-wide fibre/wireless network could be an important boost to city departments and other civic services that have growing needs for networking, such as education, libraries, police and emergency health services.”

Posted by Glennf at 1:50 PM | Comments (0)

March 29, 2008

Minneapolis Gets a Workout

By Glenn Fleishman

My pal Julio Ojeda-Zapata walks around Minneapolis, and is relatively pleased with its network: Julio writes for the St. Paul Pioneer Press, the twin city to Minneapolis, and one that hasn’t yet engaged in what was an explosion of requests for Wi-Fi networks by cities. He had a rocky start, unable to even get a splash screen, but ultimately was able to pay for a 24-hour pass ($10), and had consistent service on a laptop, albeit at half the 1 Mbps rate he was paying for. He couldn’t get an iPod touch (Apple’s iPhone without the phone Wi-Fi iPod) to work well on the network indoors, but had better luck outside.

The same day Julio’s article appeared, his colleague Leslie Brooks Suzukamo filed an article about the challenges of leaves, something that’s a big issue in Minneapolis, covered with the leafy menaces: 200,000 of the suckers that Gipper said caused pollution (as an allergy sufferer, I agree with him). Trees leaf out and reduce signal propagation, and that’s something that US Internet Wireless has had to deal with. They upped their density of nodes from 26 to 42, which appears to be about the norm for both starting and ending points in muni netwrk planning.

This article goes into a little more depth about the problems with dead areas due to absent or problematic utility poles (it’s always about the poles). USIW plans to install some of its own poles to fill in those areas.

Nearby, Steve Alexander notes a pioneering wireless network at the University of Minnesota has become obsolete. The U of M is replacing its 7-year-old 802.11b network with an 802.11n system. As is true in most older networks, they’ve got a melange of gear that’s a headache to keep running and in sync. They’ll spend $3.5m to cover about 40 percent of the campus with N, replacing a current similar coverage area. They may expand the network and add VoIP in the future.

The university and USIW are discussing interconnecting their networks for roaming.

Posted by Glennf at 5:19 PM | Comments (0) | TrackBack

Odd Coincidence of Newspapers Pleading for City Wi-Fi

By Glenn Fleishman

Philadelphia Inquirer, New York Times, Houston Chronicle call for city-wide Wi-Fi (in different ways): It’s a very odd set of circumstances that led columnists and editorial writers in three major metropolitan newspapers to come up with the idea to write about this independent of one another.

The New York Times is least informed. It suggests that Internet access is “a basic part of the infrastructure of education and democracy.” That conclusion is poorly drawn, however, due to several factual errors in their exegesis. They wrote: “…many American cities, caught up in a tide of technological and fiscal optimism, promised to try to make Internet coverage available to all by making it citywide, wireless and low-cost or even free.” True! But they leave that statement hanging there as if that’s how proposals were written.

As I have extensively documented over nearly four years, Philadelphia and San Francisco quickly dropped the “free” part, not requiring it in their proposals. Of all major cities in which plans were made, only Portland, Ore., had a free (ad-supported) option for a baseline service. (Google’s offer for SF as part of EarthLink’s plan called for 300 Kbps service.)

In discussing EarthLink, they take a recent specific statement about the future without backtracking it to last summer: “EarthLink is calling it a change in strategic direction. What that phrase means, simply, is where’s the profit?” No, it means: How, as a company, does EarthLink survive? By pour hundreds of millions of dollars it can’t afford into projects that can’t produce a return?

“The neighborhoods that most need low-cost, public wireless service now find themselves largely dependent on Internet access through public libraries.” Right, and that doesn’t require a 95-percent coverage commercial buildout. We’ll get to that in a moment in Houston.

“Philadelphia gave EarthLink free access to utility poles for mounting wireless routers.” Uh, no, editorial page of the New York Times, it did not. EarthLink and Wireless Philadelphia have a complicated arrangements with the local utility over placement and electricity. It wasn’t free to either EarthLink or WP, the actual operator (ignored in this editorial entirely, by the way).

“The costs of building a network turned out to be higher than expected — at a time when prices for private Internet service were dropping. It also hurt, in Philadelphia’s case, that there was a major change at EarthLink, which went from being an advocate of municipal Wi-Fi to a company determined to cut costs.” Again, some specious use of facts. “Higher than expected” is a gross understatement. Prices dropping, when they were cut in some markets by incumbents by a third, at least for 1 or even 2 year promotional rates, is “plummeting.” And, finally, the “major change at EarthLink” was the clear realization that their Wi-Fi approach was disastrous (paying for everything with no municipal commitment) while Helio was also poised to bleed them dry.

“EarthLink should fulfill the commitments it made.” Excuse me, bah ha ha ha ha ha ha ha ha.

The Philadelphia Inquirer’s columnist Chris Satullo has a short set of pithy advice: Don’t let the goals of Wireless Philadelphia die. The mayor’s office should hop on finding private partners, and make a significant commitment of its own. Save the partly built network, and make the economics work to preserve its potential benefit for the city. (WP continues to get high marks for it efforts in getting computers, training, and access to low-income folks in Phila., although Joshua Bretibart continues to question how some of the bills were paid and deferred by WP related to electricity, among other topics.)

Now, I’m biased on this last one, in the Houston Chronicle, as I spoke to the editorial writer, who solicited my views (among many others) on whether Houston’s “bubbles” of access plan, which will involve about $3.5m of their $5m late fee from EarthLink, made sense versus an all-at-once strategy. As the Chronicle writes, and I agree with, working with the most needy neighborhoods, were computer ownership and literacy are lacking, to provide access along with systems and training, is a brilliant approach.

Why? For a few related reasons. First, bringing computers, training, and Internet in all at once could rapidly allow people to gain the skills necessary to pull themselves up slowly out of poverty or the edge of poverty. You need computer skills for better jobs, period. Kids who grow up in homes without computers aren’t prepared for the demands of white collar jobs, medical jobs, and increasingly categories of blue-collar jobs.

Likewise, by building only in “bubbles” with specific disadvantages, Houston could become a place of experimentation by firms that want to donate gear or bandwidth, that want a tax write-off, or by local companies that want to fund such efforts further. Building a whole city is tough and, I’d argue at this particular technology junction, misguided. Building well-covered hotzones with a particular purposes plays into the ability to test ideas before shooting the whole wad of bills.

Posted by Glennf at 5:07 PM | Comments (0) | TrackBack

March 26, 2008

Metro Round-Up: Minneapolis Bright Spot; Pasadena's Dream Dies

By Glenn Fleishman

MPR radio feature on municipal Wi-Fi notes Minneapolis is different: As noted here and elsewhere, Minneapolis agreed to pay US Internet Wireless a yearly fee, and isn’t relying solely on subscriber revenue. That doesn’t mean they have a walk in the park, but it does allow them to afford to build the network out.

Pasadena acknowledges Wi-Fi network won’t be built: Their local paper picks up on the fact that while EarthLink won the bid to build the network in March 2007, it’s not going to happen.

Posted by Glennf at 10:00 AM | Comments (0)

March 24, 2008

Houston Reboots City Wi-Fi

By Glenn Fleishman

Mayor Bill White says $3.5m of EarthLink’s $5m default payment for failing to build Wi-Fi network goes to bubbles of service: 10 low-income parts of Houston will gain Wi-Fi service to bring Internet access where it’s otherwise unavailable. They’ll start with what he calls bubbles—actually, that’s a nicer term than “hotzones,” which sounds like an unpleasant bodily sensation—and hope to link those together. Gulton in southwest Houston comes first.

Tropos is donating gear for this first bubble. They lost out fairly big-time when EarthLink bumped the Houston contract, which was estimated at $50m to fulfill. Tropos would have seen thousands of their nodes deployed in Houston. This is a good way for them to generate good will and keep their name in front of future providers.

Houston Chronicle tech journalist Dwight Silverman wonders if this could help reignite citywide Wi-Fi, and notes that Houston issued an RFI (request for information) that looks for a new operator to build service out. My take is that Houston is far too rangy to ask for anything like near-complete coverage (a requirement in the contract EarthLink signed), and these new efforts and the new RFI might reflect a better sense of financial and technical reality.

As EarthLink’s CEO Rolla Huff said in an interview with me last summer about contracts such as Houston’s, “We were providing coverage to cattle. It didn’t make good business sense.”

This effort dovetails with an RFI issued by a coalition in Broward County, Flor., to built out 1,000 sq mi of service. It’s not naive, unlike a lot of earlier proposals (viz., Miami-Dade’s failed effort). The OneBroward effort links the county, colleges and universities, the school district, two health-care providers, and the county sheriff. They’re now actively soliciting private-sector partners. This is a coalition, not a network by executive fiat that fails to materialize. (The blog I link to is written by Lev Gonick, who was a big force beyond Cleveland’s OneCommunity effort that radiated out from his employer, Case University.)

Posted by Glennf at 1:53 PM | Comments (1)

March 22, 2008

NY Times Gets around to Muni-Fi's Failures, Slowed Pace

By Glenn Fleishman

The New York Times runs this story somewhat later than one might expect: I wrote a similar story that appeared last August in the Economist. This Times piece focused a bit more on digital divide issues without, of course, providing any substantiation that putting computers in people’s homes makes a difference in their lives. Sure, they have a great anecdote here that a student with a computer and Wi-Fi service doesn’t have to take a bus in a dangerous neighborhood at night to get to a library; but that hardly equates to information that kids and adults see benefits in their lives, like higher income, less drug use, higher entry into education, and less unemployment.

The article notes, “Philadelphia officials say service will not be disconnected.” This is highly uncertain. They may get some cancellation penalties from EarthLink, and the $4m estimated to complete the network is both specious (the last part of a network is always more expensive to build; it’s not linear to get to completion), and doesn’t talk about the millions in annual operating cost. No private operator would take this except under contract.

Philadelphia’s current CIO is noted as saying that “[m]arketing was also slow to begin, so paid subscribers did not sign up in the numbers that providers initially hoped.” Also specious. Without a network that worked well, EarthLink wasn’t inclined to market heavily. The same is true in most early big-city networks. Service wasn’t good; why advertise for users?

The article makes the good point that the cost of broadband has dropped (at least at entry-level points) over the last three years, making cheap Wi-Fi less of a draw than it was in late 2004.

One major error in this piece, not uncommon: “Unlike most other cities where municipal wireless was going to be offered in free hotspots and at a reduced price for residential service, San Francisco planned to offer citywide wireless free in a three-way deal with EarthLink, which was to build the grid, and Google, which would have paid to advertise through the network.” No. Google was going to subsidize a slower service, and EarthLink was offering a paid faster service. Google’s service might not have featured any advertising, either. Further, MetroFi’s model, in operation in several cities, offers free, ad-supported service, too. They’re only mentioned in passing and not by name.

Sascha Meinrath is also quoted in this article using old numbers (Sept. 2006) about St. Cloud, Florida’s network, a free service built at city expense. Those numbers are now 18 months old, weren’t provided by the city, and the mayor who inherited the already-built system disputed some of the statistics and was vocal about various problems with the network.

Posted by Glennf at 10:33 AM | Comments (0) | TrackBack

March 14, 2008

Long Island Network: No Commitments, No Pilots to Date

By Glenn Fleishman

Long Island Business News reports that E-Path’s efforts to build a Wi-Fi network in Suffolk, Nausau counties so far for naught: As yours obedient has been reporting for months, the E-Path proposal accepted by the county executives of those two Long Island entities was long on minimizing political fallout, short on providing the kind of baseline financial commitment that has turned out to be essential in getting a wireless network built. The only networks being built or completed in the country right now have municipal service commitments—anchor tenancy—or were fully funded by municipalities for public safety and governmental purposes.

As the reporter notes, E-Path hadn’t previously completed any network, and its in-progress networks are rather small. The company hasn’t been able to secure any commitments from any municipalities for service, and, you guessed it, utility poles are a sticking point: E-Path hasn’t gotten an agreement from the Long Island Power Authority to use its poles. The two pilot projects were supposed to be installed last December, but this article reports no progress.

Without anchor tenants, it’s hard to raise money. It’s hard to get anchor tenants if you don’t have money raised to build out at this point; that wasn’t true earlier. This is the same situation in all startup cycles. Early startups get optimistic customers who hope to be ahead of the curve, and are willing to be guinea pigs. With the inability of large-scale Wi-Fi networks to be completed—in some cases, even started—there’s less interest in being the exceptional case.

Long Island’s Suffolk and Nausau county executives have well insulated themselves from any problems with this network not being built, because they didn’t invest in it. Which makes it fairly likely that the network will never be built.

Wi-Fi Networking News friend Craig Plunkett is quoted in the article; he runs a variety of hotspots and networks around the island, but didn’t bid on this network. He uses an argument I’m fond of: “Any kind of dashboard diner or mobile worker is more inclined to go to a Starbucks than they are to use an outdoor location, unless their work specifically requires them to connect outdoors. So that further erodes the available market for E-Path.”

This is my backside-utility thesis. If you’re doing more than making a phone call or looking up some data while mobile (in a cab, on public transportation, as a passenger in a car, or while walking), then you need a place to sit down and work. Most places you sit down and work already have Wi-Fi. If you need more than that today, you buy a data subscription for your smartphone (or already have one) for $20 to $60 per month, or buy a laptop card with 3G data for $60 to $80 per month. If you don’t want to spend that much money, you don’t really need the data while out and about.

E-Path also has the disturbing property of having borrowed the Microsoft Internet Explorer logo used before version 8 was released as the fundamental basis of their corporate identity (IE left, E-Path logo right). They added another ring. Given IE’s reputation for security, reliability, and standards, it might have been the wrong graphic to choose, trademark issues aside.

Posted by Glennf at 9:37 AM | Comments (1)

February 27, 2008

Muni Round-Up: Longmont (Colo.) Network Sold; Milpitas (Calif.) Evaluates Post-EarthLink uture

By Glenn Fleishman

Longmont, Colo., network transferred from Kite Networks to Ohio firm DHB Networks: The Longmont City Council gave Kite’s contracts to DHB, which gives them access to city-owned fiber and utility poles, and connects them to services DHB can sell the city. Although specifics of the Kite deal weren’t noted in this story, I know from Tempe that a lot of what’s at stake is leasing agreements; DHB may be taking over leases and making payments current, or may have negotiated a discount so that the leasing firm is getting something instead of a default. DHB will also take over the Farmers Branch, Tex., network previously operated by Kite.

Milpitas, Calif., considers next steps in wake of EarthLink’s near-term exit from municipal business: The Bay Area city contracted with EarthLink for public safety services, as well as encouraging public access.

Posted by Glennf at 4:03 PM | Comments (0)

February 24, 2008

Wireless Silicon Valley Pilot Planned: Business, Gov. Services Only

By Glenn Fleishman

New life in Wireless Silicon Valley? The San Jose Mercury News reports that Covad has stepped into the mix of firms that won the contract to build out the vast Wireless Silicon Valley project. The firm will work with Cisco to build a three-month, one-square-mile test network in San Carlos. However, if the test results in a network being built, Covad will focus on business and governmental customers—no consumer public access is planned.

A few weeks ago, I predicted the project was completely dead because there was no money, no funding sources, no focus, and the major partners (IBM and Cisco) seemed unwilling to put in their own funds to jumpstart the effort.

In the interim, Azulstar, the junior partner that was in charge of running the project and gaining funding, was pushed out of Metro Connect Sacramento, and Intel and Cisco agreed to provide $750,000 in equipment loans to get things going there.

I had wondered for some time why companies with the reputation and scale of IBM, Cisco, and Intel weren’t going to the mat for the Silicon Valley project, given how embarrassing it should have been for them to have a proposal such as that fail. It highlights how these blue-chip companies put their names on proposals, when their real contribution is providing equipment loans and strategic advice, rather than real participation.

This news out of the Mercury News notes that Covad entered the business wireless broadband market through an acquisition in 2006, so it’s not that strange for the company to test the waters here.

Posted by Glennf at 7:13 AM | Comments (0) | TrackBack

February 9, 2008

Minneapolis Network Modestly Praised by Local Paper

By Glenn Fleishman

The Minneapolis Star Tribune cautiously expressed optimism at US Internet’s network: When I spoke to the editorial writer—I’m quoted briefly in this unsigned piece—about Minneapolis, I stressed that I don’t have feet on the street, but I do have, uh, feet in my inbox. When things don’t work in various places, with various services, or with various products, I do hear about it. Thank you, loyal readers. I usually know a few hours to a few days before something collapses, or when a product is utterly unfabulous from a Wi-Fi perspective.

And I don’t get email with the anger, disappointment, or even intellectual curiosity about Minneapolis, in the same way I did about Philadelphia, San Francisco, or Tempe. Which leads me to believe either no one reads my site in the Twin Cities (a possibility), or that the network is performing more or less—note the more or less—as the reporting and US Internet indicates it is.

Which must be highly gratifying to the firm when they read this local pat on the back. The paper isn’t trying to be dubious. Rather, it’s not entirely clear why US Internet succeeded where so many other firms have failed. There are at least three distinctive elements to US Internet’s deployment: they are using BelAir equipment, which is used in none of the large-scale networks that have failed to be built or that are faltering; they were signed up in order for Minneapolis to be an anchor tenant of a considerable dollar value (Houston being the only network of that scale, but much more expensive to build); and Minneapolis agreed to make upfront payments against future services to help US Internet finance and build out the network.

Posted by Glennf at 9:50 PM | Comments (0) | TrackBack

February 8, 2008

EarthLink Prepares to Sell Muni Assets

By Glenn Fleishman

The question is, of course, who’s the sucker big enough to buy EarthLink’s metro-scale systems? I say this with all due respect. There’s just not a player in the market who would assume all of EartthLink’s current systems, so it’s likely that local bidders and potentially municipalities like Philadelphia pay fire sale prices—given that the other alternative for EarthLink is to pay someone to dismantle their networks and sell the equipment piecemeal.

Update: Read this marvelous coverage from Marguerite Reardon at News.com who has covered this issue for as long as I have. She talks to folks in a couple of cities served by EarthLink. She also notes the fascinating idea that Boingo Wireless, a company founded by EarthLink founder Sky Dayton, could be one of the firms interested in some of EarthLink’s municipal assets. It’s not that much of a stretch: there might be some cherrypicking that ties in with their existing wide-scale airport operations acquired a couple years ago.

Essentially, all of EarthLink’s businesses are in decline. Dial-up customers declined significantly as, unfortunately, did their broadband service. They reduced their stake in Helio by not infusing more cash, which reduces both the downside and upside from the mobile virtual network operator business. Municipal networking is now classified as a complete bust. Where do they go from here? Improving cost structures appears to be the name of the game, but I don’t see how they become anything but a smaller and smaller firm.

The company’s earnings report today says that they lost $80m in 2007 from municipal operations, including a $28m impairment charge that wrote down the municipal assets’ goodwill, essentially. They also took $111m charge from their involvement with Helio. Gross revenue was $1.2b, which shouldn’t be understated. Despite the scale of their losses, they still have massive income.

Over the last year, the company went from 2,210 to 998 employees, lost 1.4m million residential customers. Their churn is an astounding 2.75m customers per year! That is, they started with 5.3m business/residential customers, added 2m, and lost 2.75m plus another 0.8m from an expired contract with Embarq (Sprint’s landline spinoff). However, the company recognized last year that they were spending way too much to get customers for far too short a period; that’s part of why their annual revenue per customer went up even while customer numbers were down. They shed $100m in sales and marketing expense year over year.

Posted by Glennf at 6:52 AM | Comments (0) | TrackBack

February 6, 2008

St. Louis Suburb Glimpse of Wi-Fi Networks to Come?

By Glenn Fleishman

A small firm in suburban Missouri is building out a neighborhood at a time: Network 1 is building in bits and pieces, signing up customers as they go. This strategy might work. It’s less capital intensive, although you still have the cost of building a network operation center and your backbone network; it’s just that it can be built piecemeal. It also means that problems with technology or assumptions can be corrected as the network is built and as customers start using it.

I don’t want to sound too optimistic: there are still plenty of technical, political, and financial obstacles in the way of having metro-scale Wi-Fi work. But I do think the days of 95-percent city buildout requirements led by municipalities that don’t contribute any funding or buy any services are over. It’s more likely that we’ll see a combination of public space unwiring, business-grade point-to-multipoint broadband wireless, and something like reverse redlining: Wi-Fi brought to areas with high dial-up penetration and poor broadband availability, likely in lower-income parts of cities.

The company so far has just 150 customers and 10 square miles of service area—although it’s unclear how fully unwired that coverage is. That’s a pretty tiny number, and we now have to see if the network remains reliable and scales as users join.

The folks at Network 1 are using some kind of homebrew equipment, but the results so far seem fine. Tim Logan, the reporter at St. Louis Post-Dispatch who wrote the linked story, said the firm was playing it close to the vest as to what gear they were using, but that they were employing off-the-shelf equipment. I expect that RoamAD or LocustWorld is being used for the routing portion of their network.

Posted by Glennf at 8:59 PM | Comments (0) | TrackBack

February 3, 2008

MetroFi Needs $9m for Portland Network

By Glenn Fleishman

The full story isn’t yet available, but Portland Business Journal reports on MetroFi’s cash shortfall in Portland: We already knew that the network wasn’t being built out further at the moment, only maintained, and that MetroFi was looking for more cash from either investors or the city (for services). But Aliza Earnshaw of the Portland Business Journal reports that the amount in question is $9m, and that the city remains uninterested in signing up for more.

Can you blame them? Would you want to face taxpayers in this climate, with the economy on the verge of recession, with almost no on-their-way-to-success stories of municipal Wi-Fi in larger cities anywhere in the U.S., and say, despite a contract we signed which committed us to nothing, a partially complete network, and a startup company that can’t proceed without additional dollars, that’s had contracts cancelled all over the country for similar reasons, we’re going to commit to pay out millions for services that can’t yet be offered with the current state of the network?

Unlikely.

Posted by Glennf at 7:15 AM | Comments (1) | TrackBack

February 2, 2008

NPR on Philadelphia's Wi-Fi Situation

By Glenn Fleishman

NPR reports in some depth on Phila. Wi-Fi in a 4 1/2 minute report: One Philadelphia city council member wonders if, with all the failures to build Wi-Fi networks in cities across the country, whether that means there’s no market for it. I’d argue that the technology and cost underestimations coupled with overoptimistic business plans, and a lack of real partnerships between cities and the entities building the networks have more to do with the prominent failure.

Sascha Meinrath of the New America Foundation states the municipally owned networks are moving ahead, while corporate networks are failing. I think that’s the wrong characterization, but Meinrath and the group he’s affiliated with have a specific ideology that puts everything in those terms. This doesn’t explain Minneapolis’s network, which is apparently working well and ramping up to a cash-flow positive state. It’s really more about cities putting  up money into networks, whether their own or ones being built for them. (You can read my long critique of the foundation’s report on Philadelphia Wi-Fi.)

In networks where cities have a financial commitment to build the network  or to buy services, these networks are generally being built. The economics of large-city Wi-Fi was distorted by EarthLink’s upfront willingness, then echoed by other providers, to build networks at no cost to cities with no commitment to purchase services.

The punchline for the story is that while the network is still being built in Philadelphia, very slowly, everyone’s waiting for the shoe to drop.

Posted by Glennf at 1:39 PM | Comments (0) | TrackBack

February 1, 2008

Tempe Network Deal Appears to Fall Through

By Glenn Fleishman

Tempe, Ariz., is now alerting citizens who ask that Kite Networks is in default of their arrangement with the city: The city’s deputy CIO, Dave Heck, the point person on this issue since its inception, replies to those who ask that potential buyer Telscape has “been unable to negotiate a deal with Gobility and its creditors.”

The city has declared Gobility in default of its lease agreement, and declares the network abandoned as of 28-Dec-07, which gives the city some remedies, I believe, in seizing and remo