It was inevitable that EarthLink’s massive layoffs and reorganization would spark a round of articles and blog items reassessing the previous rose-colored outlook for municipal Wi-Fi. EarthLink was the biggest private sector player in this field, with plans to build Wi-Fi networks across the nation under contract with local governments.
Amplifying the “whither Wi-Fi” discussion is EarthLink’s subsequent retreat from its bid with Google to build a high-profile Wi-Fi network in San Francisco. Mayor Gavin Newsom, the controversial proponent of muni-Wi-Fi, blames the city board of supervisors for dragging out his administration’s approval of the contract for EarthLink/Google. Newsom’s critics wanted something sturdier than Wi-Fi, such as a fiber-based network.
Now that EarthLink is beating a retreat from its costly and complex municipal projects, San Francisco has to come up with a new game plan. Newsom thinks he could have forced EarthLink to honor whatever contract it signed, despitet the company’s woes. (Oh brother, just what any local government needs — an unhappy and financially ailing contractor forced to do work through threat of litigation.)
In any event, the pundits say muni-Wi-Fi is now dead. This Economist piece concludes that the only bright spot for muni-Wi-Fi is public safety. Om says that “MuniFi” as a third pipeline suffered from too much hype.
And he’s right. Over the past few years, I’ve read with mounting disbelief optimistic muni-Wi-Fi projections developed by naive analysts and paid-for municipal consultants. Most of the overheated expectations stemmed not from real-world, cold-eyed analysis but from idealistic hope that this extremely limited technology could bust up the cable-telco duopoly.
But hope doesn’t pay the bills and Wi-Fi is just too expensive for the likes of EarthLink, and certainly out of reach for most municipal governments. And that’s just the construction costs. The operating expenses and headaches are endless burdens not justified by the so-far anemic take-rates of muni-Wi-Fi services. Maybe that’s because the access fees are sky-high for unreliable connections that rarely deliver beyond 1 to 3 Mbps download speeds.
One big reason why EarthLink and others failed to get a good grip on the bottom-line business calculus of muni-Wi-Fi is that the subject became a partisan one, and symbolized the idea that “the people” have a right to broadband connectivity, free of control by big communications companies. City governments and progressives (PDF) pushed the idea and conservatives and incumbent broadband providers rejected the very notion (PDF).
Whatever the merits of the political arguments for and against muni-Wi-Fi, few people focused on one reality: Wi-Fi technology is just too limited to work across big geographic areas. For things to work well in a city like San Francisco, thousands of tiny transmitters have to be mounted everywhere and physical impediments, not to mention bad weather, can make running the network a nightmare.
Even AT&T can’t figure out how to power the transmitters in St. Louis, and is stalling on the construction of a Wi-Fi network there.
So, Wi-Fi, while very cool at Starbucks and around airport gates, just doesn’t pass the laugh test for a major metropolitan communications system. That’s overstating it a bit…private muni-Wi-Fi networks that power city employee communications are a lot more promising, but those networks are limited in scope and aren’t built to be money-makers.
Still, wishful thinkers will continue to argue the merits of muni-Wi-Fi. But right now it looks like muni-Wi-Fi is so over.
Posted by Cynthia Brumfield at 5:26 PM | Print | Comments (1)
In an interesting gambit, a new record label is releasing a single song by an unknown Canadian artist for GBP 100, or roughly $200. Victorious Kiam is releasing on vinyl only 100 copies of “Somewhere There’s An Angel” by Thurston Revival, which apparently is the stage name of singer-songwriter Dan O’Connell.
What’s even more interesting is that 70 copies of the song were sold during the first day of its release. That’s around $14,000 right out of the gate for an unknown song by a little-known artist and the record company has already covered its costs. And apparently 10 different up-and-coming artists are recording covers for the song, ensuring at least some future revenue streams.
This is what you’d call a “premium” product, and is proof of sorts that premium-priced music can make money in an era of music give-aways and rampant file-sharing. That’s the goal of new label Victorious Kiam — to prove that music is art and has value. The company’s website explains:
…we felt compelled to make a statement with this one song. We believe that the idea of releasing Somewhere There’s An Angel with a GBP 100 price tag reiterates our sense that there is incredible value in this song.
The project is also designed to send out a message encouraging people to step back, for a moment, from all the white noise and realise that a stunning song and carefully-created piece of art can still have a value.
Even more interesting still is the corporate parent of the label, a premium music industry newsletter called Record of the Day. Record of the Day knows something about high-end premium products because the pub sells for GBP 164.50, or around $330, per year, at a time when the Internet is quickly corroding the business models of most premium publishers.
Posted by Cynthia Brumfield at 8:30 AM | Print | Comments (0)
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