MobilePro Ditches Muni Mesh Project
http://www.telecomweb.com/tnd/17055.html
Wireless data specialist MobilePro this morning walked away from its
contract to build a citywide Wi-Fi mesh in Sacramento, Calif. - only two
months after the first test system went live - in what looks to be an
acrimonious disagreement with city officials over the economics behind
the deal.
MobilePro says the city blindsided it with new contract requirements
that would require it to give away high-speed service for which it had
planned to charge. In addition, the company says the city has withdrawn
guarantees that the company would serve as "anchor tenant" for the
network in order to provide the revenue to provide lower-speed service
to economically disadvantaged residents.
MobilePro won the Sacramento contract last year, beating Motorola and
AT&T (then known as SBC) for the business. The plan called for a mesh
that initially covered Sacramento's downtown, Old Town and state-capital
areas - an area of about 10 square miles - with the entire city to
eventually be built out in phases.
MobilePro was to provide various free and fee-based services with secure
high-speed data, voice and video throughout the planned coverage area.
Subscriptions were to be sold on an annual, monthly, daily and hourly
basis. Multiple Internet service providers (ISPs) were to be allowed to
sell their services over the network. The entire project, MobilePro
says, was to be based on its massive project in Arizona, which started
in the city of Tempe and which has since grown to include neighboring
municipalities to create a muni mesh sprawling across 187 miles of
Arizona, the largest so far seen (TelecomWeb news break, March 16).
After what MobilePro termed "a lengthy permitting process," it finally
launched its first pilot test in April in an area around the city's
Caesar Chavez Plaza park. The pilot launch included a ribbon-cutting
ceremony, with local politicians mouthing predictable platitudes about
"cutting the wire" and the importance of the whole thing to the city and
its "residents, students, visitors and businesses."
Meanwhile, things weren't going smoothly behind the scenes. MobilePro
says the city sent it "a counter proposal requiring that the company
establish a free high-speed wireless network supported almost
exclusively by advertising revenue without the benefit of the city
serving as an anchor tenant."
Such a demand directly conflicts with the original plan, according to a
.PDF presentation on the Sacramento City Web site. In that presentation,
the city outlined a project with free 56 Kb/s service, but residential
service priced at $20 month for 1 Mb/s and $30 per month for 1.5 Mb/s;
higher prices were detailed for business
service or service that includes VoIP. There also was a somewhat sneaky
price plan of $4 for one hour of service - an emerging tactic in the
industry that can zing a "single shot" user with what is really an
astronomical fee for a few bits of data - but just $6 for an entire day
or $10 for a week.
"Based on the company's successful Tempe, Ariz., model, MobilePro's
original proposal provided for limited-area, limited-bandwidth, no-cost
service but required higher- bandwidth broadband users to pay a monthly
fee," the company says, adding it "also offered an alternative designed
to close the 'digital divide' to the city's low-income quintile of
residents, which included the city serving as an anchor tenant, but this
proposal was likewise rejected by the city."
Thus, the company says, it has now rejected the city as a customer.
MobilePro President and COO Jerry Sullivan, in a prepared statement
explaining the decision, said, "It is our understanding based on the
final request of the City of Sacramento that the city would require
MobilePro to provide free high-speed wireless Internet service to all
residents and have the company rely primarily on
advertising revenues for its profits and returns on investment. Based
upon MobilePro's research and experience as one of the leading Wi-Fi
broadband wireless network service providers to municipalities in North
America, MobilePro does not believe that an advertising-supported
business case is financially sustainable. At this time, we view such a
restrictive economic model as incompatible with our original long-term
plans for both the residents of Sacramento as well as the MobilePro
stockholders."
As of press time, the city of Sacramento had not said what it now plans
to do, if anything, to offer a municipal mesh network.
Regards,
Peter
RAD-INFO, Inc. - NSP Strategist
We Help ISPs Connect & Communicate
813.963.5884
http://4isps.com/newsletter.htm
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