Multi-City Wi-Fi Plan Stalls in Colorado

Published July 1, 2008

Plans to provide municipal wi-fi to several cities in Colorado have stalled due to the inability of the wi-fi provider, C-Com, to secure investors.

The Colorado Wireless Community (CWC), a consortium of 10 cities in the Denver area, commissioned C-Com to build, own, and operate a regional wireless broadband network. CWC promised to negotiate exclusive rights-of-way and leasing with C-Com following the company’s submission of a letter of intent to seek funding from private investors.

But C-Com failed to find sufficient investors, and thus CWC is no longer bound by its commitment to exclusivity.

CWC Prez Remains Optimistic

CWC President Clark Johnson remains optimistic about municipal wi-fi in Colorado, though he recognizes it might be time to examine other options or pursue a new direction.

“There is still a strong belief that a regional wireless broadband network makes sense in our communities from the perspective of government services, economic development, digital inclusion, and competition for broadband services. Wi-fi technology is not going anywhere. It is proven to work, and continues to improve, and has become ubiquitous,” said Johnson.

Earthlink Set Precedent

The troubles for muni wi-fi in Colorado come in the wake of EarthLink’s decision to leave the municipal wireless market altogether. EarthLink was an early pioneer of the movement, but it ultimately dropped plans to expand its foray into municipal wireless systems, calling the business plans “unworkable.”

Johnson is untroubled by the EarthLink precedent.

“What is happening right now is the realization that the first business models introduced around the country may not have been the right business models, and the fact that the ‘800 pound gorilla’ of the early market–EarthLink–pulled out has required folks to reexamine how to successfully deploy the technology on a large scale,” Johnson said.

Government Plans Haven’t Worked

Steven Titch, a policy analyst at the Reason Foundation, is thoroughly skeptical of municipal wi-fi business models.

“Municipal wireless has not worked,” said Titch. “The basic flaw in the plan was that cities thought they could provide fixed residential broadband service over wide areas with a technology engineered for portable use within limited coverage areas. What cities and their partners are finding is that they can’t engineer quality wireless service and meet a promised price point of $20 or less.”

Titch says market forces are a more efficient way to supply wi-fi.

“There are already free-market wi-fi services, although the providers understand the limitations,” Titch pointed out. “You can get wi-fi in almost any airport or hotel, and many coffee shops and restaurants. You can connect it to a cable modem and use it to network the PCs in your home.”

David Kopel, director of research for the Independence Institute of Golden, Colorado, agrees. He sees the local movements as a misguided effort to provide unnecessary services inefficiently.

“Wi-fi is a wonderful thing that is expanding,” Kopel said, “but the millions and millions of individual decisions of the members of the market have been able to provide these services better than those implemented by a ‘Soviet-style’ five-year plan proposed by some bureaucrats.”

Aleksandrs Karnick ([email protected]) writes from Indianapolis, Indiana.