WiFi Networks Floundering

BusinessWeek is reporting that municipal WiFi initiatives aimed at providing free or nearly free Internet access are not meeting expectations:

Why Wi-Fi Networks Are Floundering

These potholes in the nation’s wireless rollout of civic ambition—criticized by many as an improper use of tax dollars—are hardly the exception. For the road is getting bumpier for cities and the companies they have partnered with in a bid to blanket their streets with high-speed Internet access at little or no cost to users.

Minneapolis is currently in the middle of a roll-out of citywide WiFi based on a pay model. As I understand it, the city contracted with a local ISP to build the network, and will buy all of the city’s bandwidth from that supplier. Beyond that, the network is available to the public for daily or monthly fees.

While they may make a few bucks off one-off daily usage by travelers, it doesn’t seem competitive price-wise with cable or DSL to me. I can’t imagine people will drop their faster wired connections for a wireless one.

If that’s the case, the market opportunity is limited to people currently using dial-up or no Internet connection. Those are two very tough groups to market to.

In Minneapolis’ case, I believe the network is supported through the city’s own spending. That’s a different model from the direct-to-consumer models BusinessWeek suggests are floundering.

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