Over the past several years, hundreds of U.S. cities launched municipal wireless initiatives, as widespread wireless Internet access became the latest must-have for local officials bent on keeping their communities economically competitive. But that activity cooled significantly in the latter half of 2007.
The chill stems from several factors. The implosion of the "free" business model that attracted wide interest in municipal Wi-Fi has left many cities unsure of how to pursue wireless Internet access on a community-wide scale. Furthermore, shortcomings with the wireless technologies used to deliver municipal networks created other unforeseen challenges.
The business-model problems are well documented. Many projects called for commercial network providers to foot the bill for citywide Wi-Fi networks in exchange for mounting wireless antennas on public light poles and other assets. Closing the digital divide was a driver for many of these undertakings, which pinned hopes of network use on the public's appetite for low-cost wireless Internet. For the most part, the networks struggled to attract enough subscribers to make them profitable.
These difficulties were on clear display in 2007 as EarthLink - a major player in the municipal wireless market - cut nearly half its work force after losing millions of dollars on the initiatives. EarthLink CEO Rolla Huff announced the company would back away from further municipal wireless projects until it found a viable business model.
On the technology side, municipal wireless initiatives often ran into higher-than-expected equipment costs, as the task of blanketing large urban areas with Wi-Fi coverage proved harder than anticipated. Cities and their private partners found that hundreds - if not thousands - of Wi-Fi access points were needed to provide adequate coverage.
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