By Daniel Casciato
October 02, 2008
Last week, NAC, the group now managing Philly’s Wi-Fi network, emerged from a three-month transition period with EarthLink. The new focus? Not monetizing, although plans for ads and other revenue generation are being considered, but rather encouraging municipal and small business use of the “free” network.
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A group of local technology investors who acquired the former EarthLink Wi-Fi network in Philadelphia in June want to see more commercial and municipal usage for the wireless infrastructure that remains in place.
“For the time being, we have turned the service wide open for residential and small commercial use,” said Derek Pew, founder, CEO, and director of Network Acquisition Company (NAC), the Philadelphia-based organization which was created solely for the purpose of acquiring the network from EarthLink. “Our view of what the Wi-Fi network should be used for is entirely different from what EarthLink was trying to do.”
Last week, NAC emerged from a three-month transition period with EarthLink. Earlier this year, EarthLink terminated Philadelphia’s Wireless Initiative project while it was still being built out. The project’s objective was to eventually bring free wireless to the city, making Philadelphia the most connected city in the country. While 80 percent of the region is currently covered, the most densely populated part of the city, Center City, has very little connectivity due to EarthLink’s exit. NAC assumed operation of the existing infrastructure to finish deploying and enhancing the network.
“The reason we jumped into this was because we believed that there’s a mind problem right now,” said Pew. “We have people who are very negative on Wi-Fi because of what appears to be a market exit by EarthLink and other similar companies. Someone needed to step in and hold onto this asset, improve on it and reposition it, and begin to show people what it actually should have been used for, what it can be used for, as opposed to what EarthLink was trying to do with it in the first place.”
Currently, there are over 100,000 users per month, each of them averaging about four hours of usage per day, according to Pew.
“We’re also clearly seeing more people during the work week than on the weekend which suggests that business people are starting to use the network,” he said. “Now this is with us only doing POP optimization, without any marketing, and without building any additional nodes in Center City where there is expected to be a lot of demand.”
Municipal and commercial usage
Wi-Fi service will remain free to anyone who can access it in the city, but NAC plans to start monetizing residential accounts through advertising and transaction processing, such as taking a cut of ticket sales or delivering coupons, as well as offering fee-based commercial-grade networking services to businesses and government institutions throughout the city. Pew believes that free connectivity remains an ancillary benefit to the general and indigent populations of the region, but he also wants to see more involvement from municipalities and commercial entities.
“What was lost in the original Wi-Fi game plan—because EarthLink was so focused on residential—was that they didn’t focus on municipal and commercial usage,” said Pew. “A Wi-Fi network has interesting advantages for commercial and municipal.”
Some of the advantages that Pew cited include location information, frequent connectivity in places that are hard to reach with other network technology, and directly extending a server into the field.
“For instance, the ability to use a dedicated LAN into a municipal network and giving a municipality prioritization for emergency use allows them to use the wireless technology as a peer, or stacking technology,” said Pew. “It really fills in nicely in some uses. It can help automate police dispatches, deliver GIS information to remote officers, and receive mobile telemetrics from patients for ambulances before coming into the emergency room.”
Other cities as models
“Tucson has the same wireless nodes we now have in Philadelphia,” he said. “They created an advanced emergency mobile telemetric service where ambulances communicate with emergency rooms real time and, rushing down the street, communicate with nodes, and adjust traffic lights so the lights turn green on the pathways to the hospitals. They’re also doing remote videos from the emergency room into the ambulance. In Oklahoma City, the police department is using it for automatic dispatch and GIS distribution and as a result, they’re seeing reduced injuries for police officers and better crime enforcement.”
Pew noted that in places like Manhattan, they are building a Wi-Fi network for their video surveillance program and are also leveraging it for 3-1-1 support (initially used for sanitation services), while cities like Houston are using it for remote meter reading.
“If you’re a municipality using the network for emergency response, meter readings, or police surveillance, you’re not using the network very often, and you’re not using much bandwidth,” said Pew. “That means that the only cost for providing bandwidth to the rest of the population is the bandwidth into the Internet at the head end. Incrementally, for all of the bandwidth you’ll need for commercial and municipal support, it’s a tiny cost to create a massive public benefit.”
No cost to taxpayers
Pew also added that in cities like Tucson and Oklahoma City, the Wi-Fi deployments were paid for by the taxpayers.
“But in Philadelphia, no taxpayers had to pay for the infrastructure because EarthLink reportedly paid $20 million to build this network,” he said. “The city never spent any money on this, and now, all of a sudden, the infrastructure is there for our use. It fell in our [Philadelphia’s] lap. This is a great opportunity and we should take advantage of it.”
NAC will resume network build-out and is hopeful that the entire city will be connected to the wireless network in 12 to 18 months. As it continues to build out the network, NAC is also going to focus its efforts on convincing municipalities and commercial organizations to invest in the wireless project.
“We’ve been pressing the envelope on hospitals, emergency response, municipal, universities, the convention and tourism bureau—any one of them is enough to make it a go,” Pew said. “This is an asset that can’t go away. Collectively, the residential, commercial and government sectors need to figure out that there are great ways to utilize the network that make them more efficient and save them money. We’ll keep showing everyone best practices from across the country, but eventually they’ll need to come out and play.”