(Note: Light blogging today and tomorrow…am on the road and in meetings.)
The much-watched San Francisco Wi-Fi bidding process has come to an end with Google and EarthLink, who teamed to offer the city free Wi-Fi service rather than bid against each other, emerging as top picks among the contenders. The two companies have to hammer out a contract with the city, which hopes to get the wireless broadband service up and running before year-end.
Google will offer ad-supported 300 kbps service that is free to consumers, while EarthLink will offer $20/month, 1 Mbps subscription options. Andrew Schmitt thinks that the $15 million in capex costs require that the venture captures 3,000 paying subscribers at $250 year to make a decent return — and that in a city the size of San Francisco, 3,000 is easy to achieve.
That’s not including opex expenses but it also doesn’t include Google’s ad revenues from the operations. All-in-all, it’s probably a pretty good deal for both Google and EarthLink…and San Francisco.
Cynthia Brumfield at 10:18 PM|Comments(1)
Actually, it was 8,000 users. More on opex costs in the comments if you follow the link.
Posted by: Andrew Schmitt at April 7, 2006 9:27 AM
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