The Promise of Municipal Broadband.

• Author: Aaron, Craig
• Position: Essay

[ILLUSTRATION OMITTED]

When Mayor John Street announced plans to make Philadelphia the nations first major "wireless city" back in the fall of 2004, the press couldn't get enough. "Forget cheese steaks, cream cheese, and brotherly love," declared The New York Times . "Philadelphia wants to be known as the city of laptops."

Philadelphia's goal to cover 135 square miles with a cloud of Internet connectivity was ambitious. But the need was undeniable. High-speed Internet access was fast becoming an economic, educational, and social necessity. Yet most of Philly's residents were stranded on the wrong side of the digital divide, unable to access or afford a broadband connection.

When Earthlink--a dial-up Internet company looking for a foothold in the broadband world--came forward promising to build a state-of-the-art wireless system without the city paying a dime, Philadelphia signed up. And soon, you couldn't go a week without another major metropolis--San Francisco, Chicago, Houston, Portland, Oregon--jumping on the Wi-Fi bandwagon.

So what happened?

Three years later, many of the projects seem to be sputtering. The tens of thousands of new subscribers didn't materialize. Getting the equipment up on streetlights and buildings proved more expensive and technically challenging than expected. Chicago and St. Louis scrapped their plans last summer. In Tempe, Arizona, a company called Gobility shuttered the system there and unplugged its customer-service line. Earthlink abandoned projects in San Francisco and Houston, before announcing it was getting out of the municipal wireless business altogether.

With its flagship Philadelphia project still unfinished, new Earthlink CEO Rolla P. Huff announced last fall that "making significant further investments in this business could be inconsistent with our objective of maximizing shareholder value."

Then the press pounced, with stories appearing in the Associated Press, USA Today, BusinessWeek , and the Times , declaring municipal projects to be floundering, fading failures. One tech writer dismissed municipal wireless as "the monorail of the decade."

But all the obituaries are premature. A closer look at what's happening at projects across the country--public and private, wired and wireless, big and small--suggests that it's far too early to start the funeral arrangements. Much of the media are confusing the collapse of one company--or one model of broadband deployment--with the failure of the entire idea of municipalities providing high-speed Internet services.

"It's like someone striking out in a boat in 1490, it sinking, and people saying, 'You know what? This whole ocean travel thing isn't going to work out,' " says Christopher Mitchell of the Institute for Local Self-Reliance, a Minneapolis-based research group that tracks municipal projects.

Even in Philadelphia, all is not lost. In June, a group of local investors announced they had arranged to take over Philadelphia's network and offer free Wi-Fi outdoor--but details are sketchy.

Many projects--especially in small towns and mid-sized cities--are thriving. From Hermiston, Oregon, to Scottsburg, Indiana, to St. Cloud, Florida, city-owned wireless systems are up and running, serving local residents and businesses or local police and emergency workers. Places like Sallisaw, Oklahoma, and Kutztown, Pennsylvania, are building their...