The Top Five Misconceptions About the Success of Municipal Wireless Networks
By Mike Perkowski <http://www.bbwexchange.com/pubs/2007/10/04/page1423-1057917.asp> What do you call a market that?: Has grown from zero to nearly $400 million in just four years (in the U.S. alone); Is poised to grow by more than 35 percent in each of the next four years; Has created new, incremental revenue opportunities for wireless Internet Service Providers, applications developers and IT solutions providers, and; Has helped local governments save tens of millions of dollars - or more - in expenses and improved operating efficiencies. Normally, companies would be giddy about participating in a market with that much going for it. And yet despite all those attributes, municipal wireless broadband is beset by negative press coverage and mounting questions about the market's viability. Why this dramatic disconnect? First things first. Most importantly, everyone should take all the breathless, front-page coverage of this market's death knell with a very healthy grain of salt. The present angst about this market reminds us of Mark Twain's pithy commentary: "Rumors of my demise are greatly exaggerated." As journalists ourselves, we understand how stories about market turmoil and uncertainty generate interest and readership. We also know that these stories, especially when printed without market context and fact-based analysis, can easily create the misimpression that successful municipal wireless deployments don't exist; that the technology doesn't work, and that billions of public monies are being sent down a sinkhole. That simply isn't reality. But successful projects don't make the front page of the USA Today, and they don't get local politicians all riled up just in time for the next news cycle. Of course, this market is not without its challenges. Companies, investors and government officials are rethinking their approaches to municipal wireless as a way to bring cost-efficient Internet access to consumers, businesses and government agencies. And the technology has been over-hyped by all concerned, creating the prototypical gap between people's expectations and market reality. (Sound like any other recent technologies you might have experienced in the past generation of American life, like cell phones, cable TV and online shopping? If you remember, those and other new technologies weren't without hiccups in their early days, either.) But let's not let this expectation gap consume the market. Let's address the issues head on, particularly in light of what's actually happening in communities all across the country - and even around the world. Let's expose some of the widely held perceptions and talk about the market reality. Perception #1: Municipal wireless networking doesn't work. This is an easy one to dispel, backed up by our own reporting and first-hand feedback from officials in hundreds of U.S. communities (as well as the companies hired to build and operate those networks). Just ask public officials in New Orleans, where in the face of devastation caused by Hurricane Katrina temporary WiFi-based networks restored critical communications and facilitated public safety efforts. Or Minneapolis, where the city's brand-new wireless network was instrumental in helping rescue workers and a host of public employees deal with the immediate aftermath of the tragic bridge collapse. (At our upcoming MuniWireless industry conference in Santa Clara, Calif., on Oct. 21-23, we'll focus heavily on places where municipal wireless is working and providing real value to the community.) Conservatively, we believe there are several hundred towns, cities and counties where municipal wireless networks have been in place - often for years - and have returned tangible, measurable benefits for their communities. Some of them have been well documented: Corpus Christi, Texas; Providence, Rhode Island; Phoenix, Arizona, and Dallas, Texas are just a handful of well-known, good-sized communities where real applications have been deployed and are working to make local government more efficient. There are countless other smaller communities you may never have heard of, such as Racine County, Wisconsin; Umatilla County, Oregon, and Chaska, Minnesota, where the same things are happening. A big reason why: These and many other municipalities have deployed their networks primarily or exclusively for government use - not necessarily for public access (free or otherwise). While the public access stuff is sexy and magnetic in drawing press coverage and public interest, it's the meat- and-potatoes municipal applications like public safety, building inspection and meter reading that have a proven track record. Perception #2: Municipalities are competing with the private sector in building and operating their own networks. This is a canard, pure and simple. As we detailed in our recent research report "2007 Municipal Wireless Business Models," the overwhelming majority of municipal wireless networks are outsourced, at least in part, to the private sector - both in building and running the network. There were a few examples of local governments taking the initiative to put their own networks in place - primarily in rural or under-populated areas where service providers didn't deem it cost-effective to address during the market's early stage. But for the most part, municipalities are working very closely with the private sector, either in so-called public-private partnerships (usually involving mounting rights and/or anchor tenancy by the local government) or in straight-up outsourcing arrangements. A few advocacy groups have attempted to convey the misimpression that municipal wireless is some form of anti-capitalistic threat, but nothing could be further from the truth. Most municipalities lack the technical resources, the RF design skills or the capital to build and operate these networks on their own - don't worry everyone, there's plenty of business opportunity for the private sector. Perception #3: Service providers can't make money in municipal wireless. This perception is certainly understandable, given the problems EarthLink has encountered with some of its municipal deployments. But let's not confuse EarthLink's corporate challenges - which have at least as much to do with other factors as it does with municipal wireless - with how all other service providers are doing in this area. Especially in smaller communities not yet targeted by the largest, incumbent providers, service providers are honing their business models, taking prudent steps toward managing their deployments and are showing a profit on their projects. Perception #4: Public access projects have been a failure. The jury is still out on whether the concept of free public usage of municipal wireless networks - whether we're talking about downtown hot spots or citywide wireless blanketing the full community. Some cities, such as St. Cloud, Florida, and Mountain View, California, have had free networks up and running for some time, and many others have more limited initiatives providing free access on college campuses (Phoenix), downtown business districts (Annapolis, Maryland) and city- owned airports (Tampa, Florida). Regardless of whether wireless public access is ultimately free, subsidized or market-rate, there is little doubt that some form of wireless public access will be a key component to every community's broadband architecture - probably piggybacking on infrastructure already installed and used for municipal applications. Of course, if we can just keep local politicians from falling into the trap of "irrational exuberance" when it comes to hyping what municipal wireless will do - and importantly, how fast and how extensively its benefits will be realized - we will be able to continue growing this market without unrealistic expectations. Perception #5: Big-city wireless initiatives are doomed to failure. This perception is understandable, because of government bureaucracy, technical challenges, legal and political roadblocks, and the sheer magnitude of big-city deployments. There have been high-profile setbacks in San Francisco, Chicago and a few other large communities, and it's easy to paint all big-city initiatives with the proverbial broad brush. But let's keep in mind that even in these and other big cities, there already are wireless networks up and running - perhaps started even as low-profile skunk works projects - for applications like meter reading, video surveillance and wireline voice and cell phone replacement. Again, let's not bury our heads in the sand. This market is confronting important challenges and questions on everything from successful business models to developing deployment best practices to overcoming our own "hype machines." Some projects have not met their initial objectives and have gone back to the drawing board, while others are struggling to overcome technical and financial hurdles. But let's not lose track of an indisputable fact: Hundreds - maybe even thousands - of these projects are succeeding, and the market continues to grow by impressive rates - even in the face of recent negative publicity. At our upcoming industry conference in Silicon Valley on Oct. 21-23, our content program will address these issues head-on, by emphasizing deployments that have worked and are delivering on the promise of municipal wireless. Let's keep it all in perspective: This is a young, still-developing market. While many projects are succeeding, others will hit snags and others still will languish for any number of reasons. That's understandable, and it's even good - it's called learning. Remember that we've seen this before in virtually every corner of the high-technology marketplace for decades. Market research and advisory firm Gartner Inc. even gave this phenomenon a name: The Trough of Disillusionment. That's the stage of market development when the realities of implementing new technology overcomes the early-stage hype that inevitably gets built up when exciting new technologies come to the forefront. This is an exciting, high-growth market that has the potential to change the way we live and work in our communities, and to make our governments more efficient. There will be bumps in the road along the way, and lessons to be learned every day. Our advice to municipalities, service providers and technology companies is simple and straightforward: Don't shrink from the challenges - seize the opportunity. The benefits of municipal wireless far exceed the risk. Mike Perkowski is chief operating officer of MuniWireless LLC, the leading integrated media company for the municipal wireless broadband marketplace. --------------------------------------------------------------- WWWhatsup NYC http://pinstand.com - http://punkcast.com --------------------------------------------------------------- _______________________________________________ Discuss mailing list [email protected] http://lists.isoc-ny.org/mailman/listinfo/discuss
