PRAGUE, Czech Republic -- The government here wants to allocate $4.1 million to create a free wireless network citywide, which has the country's largest telecom providers crying foul.
Companies have sent a letter to the Information and Technology Ministry saying that Prague already has a developed Internet infrastructure and that the plan would hurt their businesses.
"Operators who are members of our association have a very negative opinion of this plan," said Hana Jelinkova, executive director of the Association of Public Telecommunications Networks Operators (APVTS), which includes the country's top telecom providers.
The proposal comes as more major cities, especially in the United States, are wrestling with offering municipal wireless services to get their citizens easy access to broadband. New York, San Francisco and New Orleans all plan to go wireless, and Philadelphia signed a deal with Earthlink Jan. 30 to get a citywide wireless network running by next year.
Prague already has a publicly-sponsored free Wi-Fi zone in one of its districts, Prague 5, and City Hall wants to widen the service throughout the whole city in order to promote e-government because this would streamline many municipal services such as license applications.
The government is aiming for a network with a 64 kilobytes per second connection. "This is our idea of modern public administration," said Prague's Mayor Pavel Bem. "It will dramatically increase Prague citizens' computer literacy and make it possible to digitalize work of public administration."
City Hall is asking the Information and Technology Ministry to finance two-thirds of the project designed to establish the network. The rest would come from City Hall and municipal districts. The ministry is currently finalizing its evaluation of 290 applications that are asking for public money designed to support development of Internet access in the Czech Republic.
Ministry spokeswoman Klara Volna said that in line with the law, the ministry cannot provide grants that the government's Anti-Monopoly Office could consider public support. That authority told the Czech news agency January 27 that public support for providing Internet access must be evaluated by the European Commission (EC), which will decided whether it is hurting free competition.
Kristian Chalupa, Anti-monopoly Office's spokesman, said Prague is not considered a remote area where telecom providers are not actively doing business. The EC would be more in favor of public support to Internet access in more remote areas.
Telecom providers are making the same argument. "Internet access is quite developed in Prague and the city has a good commercial environment," Jelinkova said. She added that using public money to create free access will get in the way of those operators who are already offering this service here.
"The government should support infrastructure in those places where Internet is not developed, such as small towns or villages," she said. This would help commercial Internet providers, who are often reluctant to invest in infrastructure in remote towns, but would still like to offer their services there, Jelinkova added.
Mayor Bem, however, argued that the worries of telecoms are none of his concern. "My goal is to simplify and improve public administration and make it possible for citizens to process administrative tasks through the Internet," he said.
Money for this wireless plan is available because, in the beginning of 2005, the government adopted a "National Strategy for High-Speed Internet Connection." This initiative is designed to promote and fund Internet development according to European Union requirements.
The strategy calls for earmarking 1 percent of money raised as a result of the privatization of former fixed-line monopoly Cesky Telecom last spring for establishing the high-speed Internet connection between 2006 and 2010.
This year the Finance Ministry allocated $8.7 million to a fund to be distributed among selected
projects in 2006. The fund will divide the money among three grant areas: Infrastructure, New Applications and Services, and Education and Marketing.
Some of the money could go toward wireless deployment. To date, Wi-Fi networks have accounted for up to 35 percent of all Internet connections available in the Czech Republic. A large number of these Wi-Fi networks are operated by amateurs or small companies. They emerged due to the country's underdeveloped broadband ADSL connection as a cheaper alternative for high-speed Internet access. Only 38 percent of the country's Internet access is provided through ADSL compared to the European Union's average of 70 percent.
"[Free Wi-Fi networks provided by small local companies in the Czech Republic] emerged due to the fact that competition of high-speed networks was underdeveloped here," said Lenka Hladikova, marketing manager at TISCALI, an alternative telecom provider.
Such networks are common in residential areas or apartment blocks where a technically savvy person rents a high-speed Internet line -- such as FWA or a leased line -- and distributes it through Wi-Fi.
Hladikova said, however, that as ADSL speed is growing, Wi-Fi is ceasing to be a threat to large telecom providers. "In many cases these Wi-Fi networks emerge in areas where other Internet infrastructure is underdeveloped," she said.
Katya Zapletnyuk is Government Technology/Digital Communities correspondent in Prague.
