Municipal WiFi Costs Outweigh Benefits 322
TheSync writes "JupiterResearch claims that muni WiFi costs outweigh benefits. It can cost up to $150,000 per square mile over five years, which may not even provide each user a benefit of $25 a month. They suggest that such projects only be taken on as public-private partnerships."
Look at Jupitier's motivation: (Score:4, Informative)
"The ClickZ.com Network offers cutting-edge commentary on Internet marketing and advertising from industry leaders as well as original case studies and unique insight.
The Graphics.com Network provides creative professionals with tutorials, news on the latest technologies, and community forums and galleries to display their work.
The internet.com, EarthWeb.com, DevX.com, ClickZ.com and Graphics.com Networks appeal to advertisers and vendors because they provide a community that only delivers information technology, Internet industry and creative professionals, 83% of whom make or influence technology purchasing decisions. Among our advertisers are some of the best known names in information technology and the Internet industry, including Computer Associates, Dell Computer Corporation, International Business Machines Corporation, Google, Microsoft Corporation and Oracle Corporation. " (Copied from their "About Jupitier Media" section)
Of course they back a public-private shared venture, what better way to insert ads into the public Wi-Fi network!
Pretty Funny (Score:4, Informative)
Re:Hark to my voice of warning! (Score:5, Informative)
If you've never heard of PPP, basically it's a way of transferring money from the public sector to the pockets of private individuals.
The theory is that private companies can do some things more efficiently due to their experience and better commerical skills, and that they can take the risk of the project. In reality, it usually ends with the companies using their skills and knowledge to extract large amounts of money from the (possibly naive) Government department funding the project. And sometimes the whole thing just goes pear-shaped and everyone loses out
(Yes, I am cynical.)
And this is expensive? (Score:4, Informative)
From the authors website... (Score:5, Informative)
Thhat don't exactly strike me as comapatible when you're determining whether the governement can or cannot do something cost effectively. This is being sold to companies who, one would presume, would like to convince municipalities to NOT put in a competing (wireless) ISP.
To take my town as an example, we have 40,000 residents spread over 22 square miles. A lot of these are college students (I've excluded on-campus residents from that number) so I'll say 3 people per "household". That's 13,000 potential "subscribers", or 591 per square mile. I'd say more than half here have internet access of some type. If we GAVE away the wifi cards, we might double the infrastructure cost for the first 5 years (20,000x$40/5=160k).
I come up with $16.95 per month per internet-using household. Verizon (who was laying fiber down mainstreet last week) and Adelphia wouldn't be too happy, of course.
Before you think this might be too much money for a small town, we have a PPP for a new parking garage here (and retail shopping building). A developer convinced the town to float at $2M bond to help him build the building, and he gets to charge for parking during the day and for events. Even though we had to borrow the money to do it, the mayor claimed that the town would get (x) free evening and weekend parking spaces for only $20 a month. He forgot that we were borrowing the money, and the number was closer to $50 after interest expenses. That's more than the town pays to lease surface lot space 24/7/365. But, the mayor's been known to go out to lunch - on the developers tab - fairly frequently. Now that its built, of course, nobody wants the park there, because its too far to walk (2-3 blocks) to the "downtown shops", and is used only occasionally when the on-street parking is completely full.
Re:It has to work better, first (Score:5, Informative)
For example... my home internet connection is a 6.1 mile 802.11b connection to the campus where I work and my laptop usually connects over a wrt54g unit in my basement. I am currently downloading an ISO over both of these at a hair over 230KB/s and that is the norm.
Also.. the only outtages I have ever had from any wireless are when the units themselves have lost power due to bad UPSs. (Hint... UPS in top of water tower == lightning bait
If you are having these problems I would suggest you fix the location/number of APs to get proper coverage of the area... change your wifi card to see if it is just that... or if you are using an semi-old version of windows upgrade to a newer one or to linux and get some stable drivers.
Anyways... just my 2 cents...
WTF! Yeah it is cost effective! (Score:4, Informative)
Lets see here, One square Mile in FIVE years costs $150,000. At $25.00 a month (per user) that's $1,500 in FIVE years PER user. Now as long as there are at least 10 freakin people per square mile you've at least broke even... and this is in cities, so I think there will be more than 10 damn people using the system.
God, these people who are clawing to keep this from happening to benefit the public for their own greed sicken me. I'm glad we try so hard to build useful infrastructure that is affordable and accessible to all of us who pay 30% of our paychecks to gain some usefulness besides lining some corrupt-ass politician's pockets instead. Our money is *much* better in his pocket than in the community where some benefit would be realized.
And FTR, MY internet access costs more like $40 per month and I'm sure most others do too. Give me a break!
Re:WTF! Yeah it is cost effective! (Score:5, Informative)
Re:WTF! Yeah it is cost effective! (Score:2, Informative)
Re:It has to work better, first (Score:1, Informative)
The equipment we us is all Apple: airport & airport extreme cards + a 2nd gen airport base station (not extreme).
Re:Minor Details (Score:5, Informative)
5-year projected statements are the norm for a consultant, especially one with an agenda. They might have a contract on the back burner with a telecom carrier to project the same project if they were to do it as a private project.
Second, they're making a lot of assumptions, such as internet service penetration at a given price point (estimating demand accurately is hard). Their net benefit figure probably comes from a weighted average of those on dialup and broadband, paying their respective rates currently.
Also, they're estimating cost on a project where the exact technology used probably hasn't even been determined (for instance, WiMax doesn't yet fully exist), and doesn't take into account existing infrastructure (poles, etc already exist in many places).
I agree that this is a half-assed article. I'm just trying to shed some light on what makes it a half-assed article, from the economic consulting point of view.
Re:Minor Details (Score:4, Informative)
A previous story here on
Based on that, there's no clear evidence that wi-fi is absolutely cost-effective or absolutely not cost effective. It really depends on your city and a lot of other factors. I would hazard a guess that low-density areas are not going to do well. (That's why Casper, Wymoing and Yuma, Arizona, and Bismarck, North Dakota all are at the bottom of the list).
If you have better cost info, you can always play with the data yourself.
Re:Person to person idea transmission will save us (Score:5, Informative)
I think you need to get out a little more. See, there are these things called "conversations", which allow a person-to-person transmission of ideas. And these "conversations" still occur all over the place. Visit your local coffeehouse, cafe, restaurant, or bar sometime, to see what I mean.
We no longer fight for our rights.
"We" (i.e. the great unwashed masses) no longer fight for our rights because we are fat and happy - some of the wealthiest people on the planet. Yes, yes, I know, "we" are not as wealthy as "the elite", but we're still far better off than most of the rest of the world. As a a result, "we" have become complacent and decadent.
Your elite-vs-the-workers class warfare rhetoric is charmingly quaint, but "so 20th Century". The vast majority of Americans are "middle class".
Counter-case (Score:4, Informative)
If this was such a money loser, I don't see how the service could last as long as it has.
For us, originally, town-wide wireless was a necessity. Internet access is now a major factor in people's decision on where to live. And when the larger internet companies would not lay high broadband cables out to us, we took it upon our selves to fix the problem.
The solution is a local-government run Internet provider. And although I had early issues with stability, I have been more than happy with the quality of service over this year.
Re:Contract research (Score:3, Informative)
Forrester responded to this by no longer accepting "projects that involve paid-for, publicized product comparisons".
Kudos for them. Integrity matters.