What if you built a city-wide Wi-Fi network, and no one came? Or, more specifically, everyone came but no one paid to use it?
That’s not too much of an issue in the many municipalities allowing a third-party provider/integrator to install and run a network are providing some form of free service. That’s the plan, for example, in San Francisco and Portland, Oregon.
A new report from JupiterResearch (now merged with Kagan Research to create new parent company JupiterKagan) says that while growth of public Wi-Fi usage was a full 43% from 2004 to 2005, 58% of people will only use it if the connection is free. JupiterResearch believes the goal for the providers has to be getting businesses and their traveling employees to sign up for services, as they’re far more likely to pay than consumers.
Why pay for the cow if the milk is free, though? Well, it may not be free for long, if it really is at all.
It’s hard to argue that a cash-strapped city won’t eventually start charging for access on a once “free” network if it sees a viable revenue source. Knowing that, some pundits claim that big-city Wi-Fi clouds just can’t stay free, period.
However, it’s important to see the difference between “city-wide” and “municipal” wireless. The former could be backed and run by the government, but could also be installed, operated and owned by a third-party provider. The latter is specifically where the network is run by the government and it’s installed using tax-payer funds. That has never been in favor by anyone and the smart cities know it. Many of the big-name metropolitan areas planning wireless networks now — Philadelphia, San Francisco, Portland — are setting up deals with providers who will pay for the installation and running of the network. The city usually gets unfettered access to the network in return for providing access to light poles, building roofs, and other bits of real estate needed to get full coverage.
Free Wi-Fi could probably also stay afloat by using a sponsorship model over and above the third-party installers. Analyst and author Craig Settles addresses this in his report “What’s the Price of ‘Free’?” Turning the network into a successful marketing strategy for a local business can go a long way. He also admonishes governments that move too fast and provide a so-called free service that is unusable.
While the plan for San Francisco put forth by Google and Earthlink looks great on the surface — the two will pay for the network deployment, Earthlink will run it, Google will offer all comers free access at limited download speeds while Earthlink will sell faster access (and allow wholesale access sales to other providers) — now the issue of privacy has come up.
In October of last year the ACLU of Northern California, Electronic Frontier Foundation (EFF), and the Electronic Privacy Information Center (EPIC) all submitted their own comments to the San Francisco TechConnect committee that would be making a decision about who would provide the planned city-wide Wi-Fi service. While Earthlink/Google was the eventual winner, they didn’t score well in the groups’ privacy analysis at all. Their report set a “gold standard” where no personal information is obtained from users, anonymous use is allowed, no marketing is allowed, data isn’t correlated to a specific user/device/location, and more. The only items Earthlink/Google scored well on at all was that it would let users have full access to their registration information. MetroFi, the runner up for San Francisco and the announced winner of the Portland, Oregon, contract, scored only slightly better (it doesn’t share any info with third parties), despite sharing a very similar business model of advertising support free access and no ads for paying customers.
So maybe you really can’t provide free city-wide Wi-Fi if the cost is watching advertising or giving up your personal information. But there was one contender for the San Francisco deal that scored perfect privacy marks. SF Metro Connect, the joint consortium of Cisco Systems, IBM and community-centric wireless provider SeaKay, offered up a non-profit business model. SF Metro Connect scored well with the EFF and EPIC stemming from the fact that it did not plan to collect any user information at all unless required by law.
The New York Times reporting on this issue noted that nothing is set in stone with the Earthlink/Google proposal, as the companies and the city have in place only an agreement to go into contract negotiations. Those negotiations could include discussions of privacy issues. A head of the city technology department said he would be pushing for maintain citizen privacy and security.
Google is long been rumored to be planning a move to go nationwide with its business model of advertising support Wi-Fi access. The search engine giant says still it will stay local to the Bay area, but there are already reports that it has made another bid with Earthlink, according to a report in the Wall Street Journal. A specific city was not mentioned. Earthlink by itself is building out networks for Philadelphia and Anaheim, California and has proposals in with many others; it’s not hard to picture Google eventually teaming up with Earthlink on any or all of them in the future.
In fact, Google has a patent in process to help it with that, specifically spelling out the method used to push targeted advertising to Wi-Fi users and sharing revenue with the network provider. Google also has a patent application in place for modifying a Web browser’s appearance when connected to wireless access points. There’s a chance, however, that Google’s wireless advertising patent could be in conflict with something similar with Wayport, which has the largest hotspot network in the United States — but nothing on a city-wide scale.
This article was first published on WiFiPlanet.com.