Citywide Wi-Fi Network: Costs and Benefits Uncertain

The City Council has overwhelmingly approved the terms of a contract with Earthlink to provide Houston with a citywide wireless network. The lone dissenting vote belonged to Council Member Addie Wiseman, who worried about the lack of specifics on the cost to the city. The wireless network, or WiFi, has been promoted by the Mayor and Earthlink as an opportunity for residents of low income households to have affordable, high-speed internet access. Students would presumably benefit from having the internet available to them in the home. Council members were eager to hop on the bandwagon and approve the contract. For the city's part, it will join Earthlink in an outreach program called the Digital Inclusion Project that will make the internet available to those who can't afford it. Earthlink has agreed to contribute $2 million dollars to the project over the first two years. The wireless network will cover 600 square miles of the Houston area which makes this Wi-FI deployment "the largest in North America," according to the city's press release.

Many Houstonians want to know what WiFi will offer them, and the city, that makes it worthwhile. Technically speaking, WiFi (which stand for Wireless Fidelity) allows a person to connect computers, cell phones, or PDAs (Personal Digital Assistants) to the internet by using an enabling device instead of the traditional wire connection. Such technology has the potential for improving the communications network of the city, which could be an invaluable public safety tool. Wireless laptops could allow police, fire officials, building inspectors, etc., to file reports and view database information from the field instead of being tied to the office computers, or being limited by radios. Wireless video cameras could provide realtime visual information to the police or other agencies involved in law enforcement.

Under the agreement, Earthlink will provide citywide wireless access to everyone at an inexpensive rate. For the average user that rate will be around $22 a month. For low income users the rate will be discounted to $10 a month. Those who now own laptops will be the most likely to use WiFi. Desktop PC users may have little incentive to use the wireless network unless it is more economical and reliable than DSL or cable services.

The question arises as to whether or not the city should be concerned about wireless for everyone. WiFi has been around for awhile as a popular tool for laptop users who travel on business, or coffee bar patrons who surf the web. Wireless networking has also been available to PC users in the home. As for providing wireless to low income families, the biggest obstacle would seem to be the cost of the hardware. Will the next step be for the city to provide laptop computers to those that can't afford them so that they can use WiFi? How will the city decide who qualifies to get the computers?

Taxpayers are being told that Earthlink is bearing all the cost for setting up the network. But there will be cost to the city. The contract states the city must use and pay for a minimum of $500,000 worth of wireless services annually. Of course the city will probably pay much more than that a year for wireless service on its many computers. It will also cost the city to continue the outreach program once the $2 million dollar contribution from Earthlink is exhausted. There may be other hidden costs for the city as the system is built upon its infrastructure, even though Earthlink is investing in the equipment.

Houston is not the only city entering into a contract for wireless service. Minneapolis has contracted with U.S. Internet for citywide service in a deal that resembles Houston's. Minneapolis says the deal "will result in one of the largest municipal WiFi rollouts in the United States." Atlanta also approved a contract with Biltmore Communications to provide a citywide wireless network "that will ultimately create in Atlanta the biggest high-speed wireless network in the world." As to who will ultimately get the most bragging rights is still unknown, but one thing is certain: cities are going for WiFi in a big way.

The advantages for Earthlink and similar providers in other cities appears to be enormous. Such contracts would seem to have the potential for giving them a big competitive advantage, over not only internet service providers but also perhaps wireless phone companies, considering how common internet voice communication has become these days. Having an exclusive contract for a whole city puts them in the drivers seat. Other internet service providers will probably be forced to offer wireless services purchased from them in order to retain their subscribers.

It seems that communications companies have found fertile ground for expansion by convincing city officials in all parts of the country that everyone must have wireless access to the internet. Unlike other cities, which have emphasized the benefits of a wireless network to businesses, government and travelers, Houston has primarily focused on the need to provide low-income families with this service. It remains to be seen who will ultimately be the main beneficiaries of the plan.

(Near Northwest Banner, March 5, 2007)