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ECHO stands for East Cleveland Homes Online - working to bridge the community's digital divide
Submitted by Norm Roulet on Mon, 12/06/2004 - 10:05.
ECHO is a Northeast Ohio region-wide initiative to support the leaders, residents and enterprises of East Cleveland who are proactively working to bridge the community's digital divide - ECHO stands for East Cleveland Homes Online. Representatives of the University Collaboration are driving this initiative, with prominent leadership from Case and Cleveland State. These efforts are supported by the Mayor of East Cleveland, and will help him reinvent the great community he serves.
ECHO will bridge East Cleveland's digital divide by compiling donated computers and distributing them and open source software and wifi Internet access and communications devices to insure each household, business and organization in East Cleveland has a computer with Internet access and optimal software and information services. The Intention is for computers and Internet access, training, education and support services to be made affordable for everyone living and working in East Cleveland, so life there is bettered by enhanced Internet and information technology, including Voice over Internet Protocol, social networking, eLearning, eMedicine, eCommerce and eGovernment. As East Clevelanders become experienced using these new economy tools and services, they will become more powerful forces in the local and regional economy, making NEO a stronger and better community for all.
Posted below are timely articles on technical, social and political developments related to deployment of such "socialized" information services via ECHO. The computer donation, processing and distribution initiative will be described in a different document - this write-up addresses providing Internet access. ECHO will deploy WiFi (Wireless Fidelity) as the core technology for Internet access with a "mesh", which you can visualize like a safety net. Also posted here are articles on alternative access technologies: Powerline Carrier, enabling communications via the power transmission infrastructure already interconnecting everything in East Cleveland, and WiMAX, which uses microwave to bring high bandwidth communications to target locations. Technology needed for ECHO is available in the marketplace and is reliable, cost effective, and getting better daily.
Adding a WiFi router to a cable or DSL Internet access modem (or Powerline or WiMAX access device) allows the wireless transmission of the Internet signal to and from WiFi ready computers within range of the signal, allowing many computers to access a single Internet connection. Range is determined by the WiFi technologies employed ("b", "g" or emerging "n"), and may be enhanced by optimal placement of antennas, amplifiers, and repeaters and diminished by physical obstructions, distance, and other interference. While the least expensive WiFi routers and other devices are "b", the extended range of "g" and "n" may justify using those broader range technologies for the benefit of providing service to more households per access point. It is also possible to add repeaters and amplifiers that extend range further. The deployment schema of these technologies determines the scope of the signal of each access point on the mesh. The objective is to distribute a combination of these technologies so all Internet access areas overlap, forming a mesh providing complete coverage throughout the city.
The greatest technical challenge is determining how loose a mesh is possible - how great a distance may be configured between hard-wire access points. Physical DSL, cable or other Internet access points must be contracted for homes, businesses, churches, schools and other structures distributed throughout the community - the WiFi mesh will radiate from those points. For initial modeling purposes, we'll estimate 1,000 physical Internet access connections must be contracted, for interconnecting all the WiFi technologies needed to provide coverage for 11,000 households in East Cleveland.
Computers in structures with direct access points may connect to the Internet via Ethernet. Unwired computers access the mesh and so wireless Internet by using WiFi cards/devices. By leveraging Voice over Internet Protocol (VoIP), people may also use WiFi capable telephones and computers for telephone communications throughout the internetworked community and via the Internet world-wide. Costs for computer WiFi cards have become quite low - a "b" card costs under $20 retail - bulk wholesale purchases could drive that cost to around $10. "g" and "n" cards cost somewhat more. The "g" and "n" cards and routers are backwards compatible to connect with "b" devices so a combination of all these WiFi standards will be used, as is most cost effective.
To complete a cost analysis, we must determine the availability of DSL and Cable Internet access in East Cleveland. Areas where households are physically isolated or where there is not any broadband service available will be the most costly and difficult to include in the mesh - perhaps requiring WiMAX and higher strength WiFi deployments. A map must be developed of all addresses in East Cleveland needing Internet access, on which we'll overlay available Internet service options and the optimal mesh of technology solutions. This is not an especially difficult challenge - the data should all be available.
It must still be determine what level of broadband is available in East Cleveland via existing DSL service providers and via cable Internet access. Where available, monthly charges quoted by SBC for DSL in Northeast Ohio range from a minimum of $19.95, if bundled with other SBC telecommunications services (like long distance phone), to an unbundled $29.95, if signing a one year contract. To receive SBC DSL, customers must also subscribe to their POTS - Plain Old Telephone Service - which costs a minimum of $12.67, for those eligible for SBC's low-income "lifeline" program, meaning monthly DSL related access costs/customer total a minimum of $42.62. If available in East Cleveland, cable internet access typically costs around $49/month, after any trial period discounts offered by carriers. With a one year contract, DSL and cable service providers typically provide a DSL or Cable modem at no additional cost - carriers may charge for installation and equipment shipping. These figures are estimates and all this information will be validated by contacting all carriers servicing East Cleveland. Further, pricing may be reduced through strategic planning and negotiation for service in bulk contracts.
For initial modeling purposes, project up-front cost of $50/modem and recurring cost of $20/access point/month X 1,000 access points = $50,000 up front and $20,000 per month for all of East Cleveland. In addition, there will be an up-front cost for the hardware to configure the WiFi transmission mesh for the 10,000 wireless access households projected in this model for East Cleveland - estimate 1,000 routers, at $50/router, and 1,000 amplifiers/repeaters, at $50 each - totaling $100,000 in additional up front hardware costs. The 1,000 households with cable or DSL modems will be able to access the Internet using ethernet, and ethernet cards are preinstalled in enough computers to assume that will not add any costs. The computers accessing the Internet mesh via WiFi will need WiFi cards, which will be estimated at $20/card, adding $200,000 to the up front hardware costs for 10,000 households. Thus, the up-front hardware cost to interconnect 11,000 households will be around $350,000 - about $32/household. Monthly access service costs will then be around $20,000 for the community of 11,000 households, being under $2/month/household. Even if costs are twice those estimated here, they are quite affordable - most households can afford $2-4/month for high speed Internet access, especially as that also enables VoIP (to optimize this capability, some computers may need headsets, which are available for under $10/headset). Households in East Cleveland already contracting for broadband Internet service will be able to participate in this mesh pricing model, allowing those residents to save or be compensated $30-40/month.
While $350,000 may seem like a lot of up-front money to spend in this community, it provides Internet access to 11,000 households and thus comes to around $32/household, which should be a manageable one-time expense for most households. If some East Cleveland households can't afford that cost up front, there should be a way to finance that over a year, as each household can afford $3-4/month for hardware, on top of $2-3/month for access. It is reasonable to project the entire mesh, with financed access hardware and recurring monthly service, is thus viable for less than $10/household/month. Consider, this distributed mesh cost is about 50% the minimum cost for any of these households to contract just local POTS - Plain Old Telephone Service - and 10 - 20% of what it would cost them for either cable or DSL Internet service, if they qualify. As a strategic planning option, each household could be expected to pay $10/month, which would generate $110,000 per month community wide, totaling $1,320,000/year, which would generate around $500,000 for other development and support costs and cover any losses from non-payments, customer hardships, stolen equipment and such.
To make the process as cost-efficient as possible, a not-for-profit organization should be used to deploy the mesh and enabling hardware and support services, as that may accept donated hardware and services - every device donated and service volunteered represents dollars saved from the costs to the people of the community. This 501c3 should be able to contract advantageous Internet access pricing for the entire community as an umbrella service contract, and should be able to acquire all hardware and contract services in bulk buying agreements for everyone, while negotiating every other advantage possible for a charitable organization. Options to pursue are grants, gifts and charitable donations, and collaborative relationships with schools, government, and other charitable organizations.
It is important to realize the mesh will serve East Cleveland businesses, government, and other organizations as well, making all of them more effective. As an example of the value of that, the Director of East Cleveland's largest employer, Huron Hospital, apparently wanted to initiate a buy-in-East Cleveland program but found few East Cleveland businesses are available on-line, so it is functionally impossible for a sophisticated enterprise to buy local. But as local businesses and residents move into the New Economy, it is a minor task to develop directories of their services, and enable eCommerce capabilities. Thus, local businesses and organizations like Huron Hospital can better serve their community, as is their desire. And all other East Cleveland residents will become more employable and be better served by their local business community, and East Cleveland will be a better place to base a business.
Huron Hospital and other service providers will be able to provide better service to an interconnected community. East Cleveland government and schools will be able to better serve their community. Organizations, businesses, and individuals within and outside East Cleveland will be better able to serve East Cleveland residents, and residents will be better prepared to serve their community and the entire region in every way imaginable. All the great benefits will become clearer each day East Cleveland is undivided.
The only obstacles to making this happen would be obstruction by businesses that hope to sell competing information technology and services in East Cleveland. But, as the preponderance of good to come from ECHO far eclipses the self-interests of any businesses hoping to profit off the struggling residents and small businesses of this community, it is safe to assume no socially responsible businesses will obstruct this transformative initiative.
Some related links:
Verizon deal lets Philadelphia move with wireless plan
By Stephen Lawson
The city of Philadelphia has reached an agreement with Verizon Communications Inc. that will let the municipal government deploy a citywide Wi-Fi network, but a carrier-backed bill that would let incumbent carriers block such projects has been signed into law by Pennsylvania's governor. Philadelphia announced earlier this year that it plans to deploy a wireless broadband network beginning in June 2005 and charge subscribers to use it. Pennsylvania House Bill 30, a broad telecommunications act signed into law Tuesday by Governor Edward Rendell, gives incumbent local carriers such as Verizon the right to keep local governments from setting up paid services like Philadelphia's after Jan. 1, 2006. On Tuesday, Verizon waived this right of first refusal on the Philadelphia project, according to representatives of Verizon and of the city's mayor, John Street.
At issue is the availability of broadband Internet access to residents of Philadelphia, where city CIO Dianah Neff says about 60 percent of the neighborhoods don't yet have high-speed data service. The city aims to fill in gaps in broadband availability, such as in low-income neighborhoods, at an estimated price of US$15 to $25 per month, according to Neff.
Earlier versions of the bill banned local governments from offering broadband services for pay. The version signed into law Tuesday allows existing services to continue and gives governments a one-year window to develop them. After that point, it requires governments to offer the incumbent carrier the right to provide the service. Free services are not affected by the law.
Philadelphia's agreement with Verizon will allow the city to roll out the network as planned, according to Barbara Grant, the mayor's director of communications. The city intends to finish the estimated $7 million to $10 million deployment by June 2006.
"We think that what we did today provides a good model for how business and government can work together to assure that a public good is provided," Grant said. The network, which will use a wireless mesh to link Wi-Fi access points, will promote economic development as well as providing high-speed data for schools and low-income residents and others, she said.
"This leaves all the rest of the municipalities in the state pretty much on their own," said Christopher Craig, chief counsel for state Senator Vincent Fumo. If those cities want to roll out their own paid services, the local incumbent will be able to dictate terms. Governments should be able to choose service partners based on cost and quality just as private companies do, he said.
Verizon opposes paid services offered by cities and municipalities on the grounds that governments have unfair advantages, such as being able to tap into public funds and not having to pay taxes, Shaffer said.
"With so many competitors entering the marketplace and other companies' businesses, we simply believe the same rules should apply to all the players," Shaffer said. Though Verizon is the largest incumbent carrier in Pennsylvania, there are 37 carriers of all sizes in the state's carrier organization, the Pennsylvania Telephone Association, she said.
Tuesday, November 30, 2004
By Corilyn Shropshire, Pittsburgh Post-Gazette
Members of a public-private committee charged with recommending how Pittsburgh can keep up with rapid changes in communication technologies say a citywide wireless fidelity or "Wi-Fi" Internet connection is still a long way off.
Telecoms lobbyists push to quash Philadelphia's municipal wireless plan (11/24/04)
The Information Communications Technologies Working Group -- a 25-member committee composed of public officials, local telecommunications providers and non-profit advocates -- say the question is not when but if the city should jump on the bandwagon with other U.S. municipalities that are starting to provide the public with inexpensive wireless Internet access, reducing the need for high-speed cable or telephone connections.
"There are different schools of thought," said William Peduto, the District 8 city councilman who convened the working group's first meetings this summer.
"We're still debating whether or not it's a good idea," said group chairman Alex Thomson, an attorney at Downtown-based law firm Houston & Harbaugh PC. "Certain constituencies think it's a great idea and others think that it's stupid."
Peduto and other committee members say they have not even begun to discuss what it would cost to bring Wi-Fi into every Pittsburgh home.
Meanwhile, the city of Philadelphia already is offering free Wi-Fi "hot spots" in certain locations around the city and is planning to expand access to the entire city at an initial estimated cost of $10 million and an annual price tag of $1.5 million to maintain.
Philadelphia's plan appeared to hit a snag when the state legislature recently passed a measure, backed by Verizon Communications Inc., that would prevent Pennsylvania cities and towns from bringing wireless Internet to their residents unless local telephone companies declined to provide the service. Gov. Ed Rendell has until midnight tonight to veto or sign the bill, which sets rules for telephone competition in the state.
Verizon and Comcast Corp., which both have seats on the Pittsburgh committee, have lobbied vociferously against local wireless initiatives. They fear that municipalities that build and operate wireless Web connections at cheaper rates could ultimately steal their high-speed Internet customers.
"It's clear that based on their lobbying efforts, Comcast and Verizon are against municipals getting into the business," said committee member Timothy Pisula, CEO of YYireless1.net, in Carnegie, a wireless and broadband Internet provider.
A Verizon spokesman said yesterday the company will not stand in the way of Philadelphia or Pittsburgh to provide wireless Internet access citywide.
"The entry of municipalities into the broadband business is not something we would prefer to happen," said Verizon spokesman Lee Gierczynski. "It raises some legitimate questions and concerns."
Cities that have jumped into the Internet service provider business often offer Wi-Fi service free or at a lower cost than telephone and cable providers.
That creates unfair competition, according to Gierczynski. "We're not against competition, but [cities] have those inherent advantages that don't provide for a level playing field," he said. "It's more effective for municipal governments to work with private sector companies, rather than deploying these networks on their own."
The debate inside the Pittsburgh working group, Pisula said, is if the city should develop hot zones in public areas such as PNC Park, Market Square and Heinz Field or spread it throughout every corner of the city.
Cost, Pisula added, is not yet an issue. "The last meeting was a somewhat passionate debate about whether or not the city should be in the business" of providing Internet access, Pisula said.
Working group members said they were not sure how much it would cost to install and maintain the small antennas that allow users to connect to the Web via radio waves instead of cables. The committee is expected to deliver its recommendations to the Mayor and City Council sometime in March.
With Pittsburgh's budget crisis, creating universal Internet access seems a petty problem and a lofty desire. But proponents maintain that staying ahead of the technological curve helps lure and keep businesses and jobs in the city. And without it, residents in poorer neighborhoods may have a long wait for telecommunications companies to offer them high-speed Internet access.
"I'm a capitalist, but if the city believes this is important to attract business and upscale residents, then they would have to subsidize it." Pisula said. "That would bring it to bear a lot quicker."
Without "socialized telecommunication," Pisula said, it could take years for companies to decide if it's worth the investment.
Wi-Fi is widely regarded as the cheapest way to provide areas with Internet access because it costs less than planting cable lines underground.
Some cities, such as Hermosa Beach, Calif., are providing residents Wi-Fi service for free and paying for it with advertising revenue. Other cities are undercutting the price of commercial high-speed Internet providers, who can charge as much as $60 a month.
"Making money is not the city's goal," said Esme Vos, who runs the Web site www.muniwireless.com, which tracks cities' efforts to offer Wi-Fi. "Cities want everyone, including poor people, to have broadband, and Verizon wants to deliver it to people who can pay."
"I think the city isn't interested because they can't generate income from it," said Carl Redwood, a community activist in East Liberty. "The case for how it will help the city is not clear enough." Redwood added that the city could generate income from deploying a Wi-Fi network as well as boost its image as a forward-thinking, high-tech hub.
Still, Thomson acknowledged that before the city can begin planning to pepper neighborhoods with wireless Internet, it has to solve its fiscal issues.
"The city's got other fish to fry," Thomson said.
(Corilyn Shropshire can be reached at cshropshire [at] post-gazette [dot] com or 412-263-1413. Correction/Clarification: (Published Nov. 30, 2004) A telecommunications bill passed by the state Legislature last month would permit municipalities to offer free or low-cost wireless Internet service only if local telephone companies had declined to provide the service. A story Tuesday incorrectly suggested the measure would bar any public-sector wireless projects in Pennsylvania.)
Telecoms lobbyists push to quash Philadelphia's municipal wireless plan
Wednesday, November 24, 2004
By Marc Levy, The Associated Press
HARRISBURG -- Philadelphia's plan to offer inexpensive wireless Internet as a municipal service -- the most ambitious yet by a major U.S. city -- has collided with commercial interests including the local phone company, Verizon Communications Inc.
In fact, a bill on Gov. Ed Rendell's desk that could humble Philadelphia's ambitions began 19 months ago as a proposal drafted by lobbyists for telecommunications companies.
Regional and long-distance phone companies, who sell broadband Internet to consumers and businesses, have in recent months intensified a national campaign to quash municipal wireless initiatives like Philadelphia's as dozens of cities and towns have either begun or announced such plans -- from San Francisco to Chaska, Minn., to St. Cloud, Fla.
Telecommunications companies are doubly worried because hundreds of other municipalities provide broadband service over cable or telephone lines.
The idea of cheap, municipally provided Internet as social leveler is particularly appealing to big city politicians.
"We looked at it as a way to be a city, literally, of the 21st century," said Barbara Grant, a spokeswoman for Philadelphia Mayor John F. Street. "We wanted to bridge the digital divide for residents who wouldn't have access to the Internet, particularly schoolchildren."
Plus, the service could help make Philadelphia "hip" enough to stem the outward flow of college graduates, she said.
But the telecoms industry, its business in turmoil as such disruptive technologies as Voice over Internet calling turn traditional revenue models on end, calls such public-sector projects unfair competition.
In the past year, companies including Qwest Communications International Inc., Sprint Corp., BellSouth Corp., and Verizon Communications Inc. have pressed for legislation in Pennsylvania, Florida, Utah, and Louisiana that would extract concessions from public-sector telecommunications ventures.
A chief complaint: a city can draw on taxpayer dollars, while a private company has to pay interest on borrowed capital. Also, the telecoms complain, public-sector projects are subject to far less regulation.
"Verizon has always been pro-competition if all of the competitors that are providing the same kind of service are governed by the same regulations," said spokeswoman Sharon Shaffer of Verizon, the state's largest phone company and Philadelphia's dominant provider.
The bill that reached Rendell's desk over the weekend originally included a provision that would bar "political subdivisions" in Pennsylvania from providing telecommunications services for a fee.
It was tucked into a larger, 30-page bill drafted by industry lobbyists to give telephone companies financial incentives to quicken the rollout of broadband networks -- a carrot worth as much as $3 billion to Verizon.
As the bill evolved, House lawmakers softened the provision to allow the public-sector projects if the traditional local telephone company first declined to provide the service.
In the days before the Senate approved the bill early Friday morning, Philadelphia's wireless advocates discovered the provision and cried foul. In response, senators changed it to allow services operating before Jan. 1, 2006, to continue, giving Philadelphia some time to get going.
Consumer advocates say cheap Wi-Fi fills a need the private sector has no intention of meeting.
"They're saying, 'You provide it to any place we can't or won't, but you can't charge a fee,' " said Edward Schwartz, a consumer advocate and member of Philadelphia's wireless task force. "How does that work?"
Rendell, a former Philadelphia mayor, has until Nov. 30 to veto the bill, and hasn't yet said what he plans to do.
If he signs the bill, it would add Pennsylvania to the dozen or so states that regulate public-sector telecommunications projects or ban it outright. Such laws have been upheld by the U.S. Supreme Court.
Philadelphia city officials had said they planned to introduce the service in the summer of 2006, offering it for free or at costs far lower than the $35 to $60 a month charged by commercial providers, said the city's chief information officer, Dianah Neff.
Now, they may have to move more quickly.
"It would be difficult, but not impossible to have it by January 2006," Neff said.
Neff and others are now studying options for business models that could comply with the legislation. The city could award a franchise to a private company or nonprofit to operate the service. Or it could raise money through advertising or private donations instead of charging a subscriber fee.
The projected cost for installing antennas across the city's 135 square miles would be $10 million and another $1.5 million annually to maintain it, Neff said.
The industry's aggressive lobbying notwithstanding, at least one wireless advocate predicts public-sector wireless access will be impossible to squelch.
"Once the genie is out of the bottle," said Greg Richardson, a consultant on the Philadelphia wireless project, "it's very difficult, if not impossible, to put it back in."
This site is devoted to municipal wireless broadband projects worldwide that are funded or supported by cities and towns. These range from downtown hotzones to city-wide wireless broadband networks. Although I often use the word "city", rural municipalities receive equal coverage because they are leading the fight for affordable, fast, universal access to the Internet.
I included a category called Community Wireless to highlight wireless projects organized and run by local residents, with or without support from the municipality. These grassroots initiatives -- run by volunteers -- force local and regional governments to remove barriers to affordable wireless (and wired) broadband access. Where governments have been too slow and risk-averse, these groups unwire their communities with do-it-yourself networks.
I also write about wireless technologies (Wi-Fi and WiMAX) and applications that take advantage of wireless access. From time to time I poke fun at the nonsense thrown at us by research analysts trying to get us to buy their $2000 reports.
I would like to hear from you about upcoming projects. Please send your news (as well as corrections) to: info [at] muniwireless [dot] com.
Who is behind Muniwireless
Muniwireless.com is an initiative of my firm, Lemon Cloud BV, a legal and consulting firm devoted to tech companies. I can act as your in-house legal counsel on a part-time/interim basis. I can also assist you in licensing and distributing your software, and in closing large deals (M&A included). If you are a US company, I can help you get started in Europe, set up your European offices, draft all your contracts and hire personnel. If you are a startup, I can create a legal framework for your deals (contract templates, sales force training) and help you negotiate with investors and customers.
I provide consulting services to municipalities that wish to deploy citywide wireless networks. My most recent municipal client is the city of Leeuwarden in the northern part of the Netherlands. Contact me if you want to know more about what you can do with your city fiber net or if you need help in drafting RFIs and RFPs, interviewing and choosing vendors.
If you are vendor and wish to position yourself in the municipal wireless broadband market, I can help you. I can also put you in contact with potential customers and partners.
Â· ICT Infrastructure in the City (Nov 2003 Amsterdam)
Â· Hotspot Event (March 2004 Amsterdam)
Â· Pervasive Connectivity (April 2004 Washington DC)
Â· Eye for Wireless (April 2004 San Francisco)
Â· Wireless Internet and Municipal Public Safety (Jun 29-30 2004 San Mateo, CA)
Â· European Social Forum (Oct 15-17, 2004 London)
Â· Wi-Fi Business Development Summit (Oct 26-27, 2004 Paris)
Â· Wi-Fi Planet (Nov 30-Dec 2, 2004 San Jose, CA)
Here's a photo of me - Esme Vos. I am an intellectual property lawyer, gadget freak, writer and former chemist. When not working on legal and wireless consulting projects for clients, I write technology-related articles. My latest piece is on fiber nets and Wi-Fi for a Dutch professional journal called Stedebouw & Ruimtelijke Ordening (Urban construction and spatial planning - roughly translated into English). I love my iMac and my iPod and encourage people to switch. I believe in open networks and open spectrum.
The opinions I express are my own and I disclose any connections (client, investor, friend, advertiser) relating to my pieces. Materials from third parties such as news items, articles, advertisements, sponsorships and promotions, represent their opinions, which I may not share.
I encourage you to link to my site.
Information you provide to us, such as your name, email address, physical address, company affiliation, remain for our eyes only unless you give us permission to divulge it to someone else. From time to time, we may disclose the overall number of visitors, their geographic location and other information, but this information will not be the kind that identifies who you are.
Copyright Notice: Â© Copyright 2003-2004 Lemon Cloud BV. All rights reserved.
Why 'Socialized' Broadband Won't Work
By Sonia Arrison â€“ TechNewsWorld - 12/03/04 5:00 AM PT
If a competitive broadband provider started offering wireless access for free, there would likely be calls to stop what some would call the practice of predatory pricing. But when government tries to undercut business with taxpayer dollars, those would-be critics stay silent.
The issue of government-provided broadband was in the news again this week as Pennsylvania Governor Edward Rendell signed a bill restricting the ability of cities to offer telecommunications services. This was a good move for a number of reasons.
At any level, government-provided broadband -- what some call "socialized" communication (here, this silly editorial has a shopping link to the messageâ€™s sponsor â€œRelevant Products/Services from Sprint -- With Sprint, business is beautifulâ€?. has always been a bad idea. The time has come for policymakers to drop it because governments do not operate the same way businesses do.
Governments get their capital from taxpayers who generally have little say. Businesses, on the other hand, have to prove to capital markets that they will produce a return on investments. This difference in incentives matters a great deal. Take the San Francisco government, for example.
In September, Mayor Gavin Newsom announced free wireless access in Union Square in order to attract more tourists. While it's unclear how much time the mayor spends in Union Square, most people go there to shop, not to sit around in the less-than-balmy San Francisco weather checking their e-mail.
Getting the Market Right
If there were serious demand for wireless in the exact location of Union Square, businesses would provide it. As it turns out, however, most people would rather sit in a warm Starbucks (Nasdaq: SBUX) Latest News about Starbucks store where the lattes flow. T-Mobile's Latest News about T-Mobile hotspots are well used by locals and tourists alike, and according to a recent survey by computer chip maker Intel (Nasdaq: INTC) Latest News about Intel, the San Francisco area is the most "unwired place in America."
"The San Francisco Bay Area Metropolitan Statistical Area (MSA) is the No. 1 market for wireless Internet accessibility in the United States. From Fisherman's Wharf in San Francisco to San Jose's San Pedro Square to Oakland's Jack London Square, Bay Area residents have greater freedom to communicate, be productive, and entertained with notebooks PCs and wireless Internet connections," says Intel's April 2004 press release.
Further, FCC data show that when all San Francisco zip codes are taken together, the number of high-speed Internet providers (DSL, cable modem, wireless, satellite, fiber) offering broadband service to at least one customer is around 12. When one examines the zip codes of poorer neighborhoods, like the Bayview District, Hunters Point, and Western Addition, the data show they are serviced by the same number as the city average.
By all accounts, the private sector is doing a good job of servicing San Franciscans, making one wonder why Mayor Newsom announced in October that he'd like to see the city offer wireless in even more locations. He may believe this high-profile issue will put him in the spotlight, but he should realize his policy of free access would hurt the city's progress.
If a competitive broadband provider started offering wireless access for free, there would likely be calls to stop what some would call the practice of predatory pricing. But when government tries to undercut business with taxpayer dollars, those would-be critics stay silent. Perhaps that's because it hasn't quite sunk in that when government crowds out business using taxpayer funds, it results in a decline in service, convenience, quality and innovation.
Again, looking at the sorry example of San Francisco, one can see immediately that governments tend to make infrastructure Relevant Products/Services from Sybase ASE Linux Express Edition â€“ FREE decisions based on politics, not on the basis of providing the best service possible. Water and sewer systems, government buildings, and recreational areas all suffer from the fact that it's easy for political leadership to ignore problems that might not be apparent for years. Indeed, by some estimates, San Francisco has deferred US$1.4 billion worth of maintenance over the last 20 years.
In the Hole
Data services problems would become apparent faster than the realization that buildings are deteriorating, but nevertheless the city's poor stewardship would eventually sully San Francisco's reputation as a place on the cutting edge of technology. And it gets worse. As Californians and others around the country know all too well, governments have trouble balancing their budgets.
In order to make up for massive government overspending, Mayor Newsom has said that he'll have to lay off 200 city employees, shut down recreation centers one day a week, pare back health clinic hours, trim pothole-repair and street-sweeping crews, and either cut bus routes or raise fares. And even with these cuts, city officials anticipate starting the next fiscal year $135 million in the hole.
This is not the profile of a city that should get into the broadband business. If it did, residents would be buried deeper in debt under a poorly run system.
Pennsylvania lawmakers were wise to move towards forcing cities out of the broadband business, but some areas still like the "socialized" concept. For the welfare of consumers, policymakers should say no to such outdated and wrong-headed ideas.
Sonia Arrison, a TechNewsWorld columnist, is director of Technology Studies at the California-based Pacific Research Institute.
Broadband-over-powerline start-up gets funding
By Network World staff
Amperion Inc., a start-up that makes equipment to deliver broadband service over powerlines, this week announced US$10 million in new funding. The Chelmsford, Mass., company says the funds will be used for market expansion and developing the next generation of its hardware and software for medium-voltage power networks that pass near residential and business locations. The company boasts that its technology delivers up to 24M bit/sec of throughput on power lines and in backhaul applications, and supports up to 6M bit/sec throughput to end users via 802.11 connectivity.
Investors in this round include Aspen Ventures, Argo Capital, Global Internet Ventures, Pennsylvania Power and Light, Redleaf Group and Telkonet.
Earlier investors included American Electric Power and Cisco. Amperion Chairman and CEO Philip Hunt worked at Cisco Systems Inc. as a senior manager involved with powerline and related technologies before starting Amperion in 2001.
Amperion, which has received about $22.5 million in funding overall, began selling products in the spring of 2003.
The company claims customers such as Progress Energy Inc., Southern Co. and PUC Telecom Inc. It sells to both electric utilities and carriers that exploit powerlines to deliver broadband services.
The company touted an FCC ruling in the fall that gave power utilities the go-ahead to carry data on their electrical wires. Proponents of broadband-over-powerline services say such offerings will enable those not reached by more traditional carriers' broadband offerings to get higher-speed services.