San Francisco Should Dump Wi-Fi Plans

Published October 1, 2005

Now that San Francisco has issued its Request for Information and Comment (RFI/C) on its proposed citywide municipal wireless system and Mayor Gavin Newsom has asked for public feedback, the response should be a no-brainer, especially in a city dubbed the number-one wireless market in the U.S.

Getting high-speed access in San Francisco is not a problem. According to the Federal Communications Commission, when all San Francisco zip codes are taken together, the number of high-speed Internet providers (DSL, cable modem, wireless, satellite, fiber) offering broadband service to at least one customer is around 12. The same number of providers, the data show, serve poorer neighborhoods like the Bayview District, Hunters Point, and Western Addition.

Fees for broadband have been dropping at an amazing rate. DSL service, which used to cost around $50 a month, can be purchased for $14.95.

Strangely, these facts don’t seem to resonate with local government bureaucrats. Instead, they think residents of San Francisco should have “nomadic” wireless broadband access and they should have it now. That impatience could carry a heavy price for taxpayers and consumers.

Municipal broadband networks are costly, risky to build, and difficult to maintain. And San Francisco, like many other cities, is in no position to lead the way. The city faced a projected $59 million budget shortfall this year, dodging it only by raising parking fines for locals and fees for public services.

If City Hall can barely afford to provide residents the critical services that matter most, such as police, fire protection, and public transportation, why would anyone think it will be able to maintain a high-quality, cutting-edge broadband network? Those who agree with the mayor should consider the many examples of city broadband plans gone wrong. Tacoma, Washington; Marietta, Georgia; Kutztown, Pennsylvania; Ashland, Oregon; Trion, Georgia; and Cedar Falls, Iowa are just a few of the examples of city broadband failures. The price tag for these mistakes is either a tax increase to cover the costs or service cuts in other areas.


In Tacoma, for example, the city’s utility ran a $23 million operational deficit in 2001-2002, on top of $16 million in operating deficits that accumulated over past years. Such a dire situation would lead a private corporation into bankruptcy, but Tacoma avoided that scenario by making residents pay for the mismanagement. Unfortunately, these examples don’t seem to bother Newsom and his staff at all.

“We either are going to find a partner or we’re going to write a big check,” Newsom said, showing his commitment to the current municipal Wi-Fi craze. That’s quite the attitude, and some wireless experts wonder why the mayor is pushing so hard.

“WiFi is over-hyped,” said venture capitalist Richard Ling. Indeed, there’s a whole history of technologies and products that have been over-sold–recall the Internet bubble–only to fall flat on their faces before really making a difference.

Among other features, the city’s RFI/C calls for universal in-building coverage in every part of the city, the ability to hand off a data link from node to node while the user is in motion, and capability of supporting high-end mission-critical corporate IT applications such as supply chain management and inventory tracking.

Although it is conspicuously absent in the proposal document, on separate occasions Newsom has urged that the city’s network service should be free to all. As it is, the RFI/C demands price points be substantially less than commercially available services, yet not rely on taxpayer subsidies.

Before San Francisco officials make a huge mistake, they should open their minds and look to the future. Recent changes to telecommunications regulations, combined with innovations happening at mind-blowing speeds, mean the broadband market is only at the beginning. If the city actually does go ahead with a so-called free Wi-Fi plan, by the time it rolls it out, it will be obsolete.

The DMV-ization of broadband is something San Francisco can do without, especially if it increases taxes and makes it more difficult for the private sector to innovate. The city should dump the Wi-Fi plans and cooperate with the private sector on rights-of-way and other issues when the market is truly ready to provide “nomadic” access. That way, San Francisco can maintain its status as the nation’s wireless leader.

Sonia Arrison ([email protected]) is director of technology studies at Pacific Research Institute in San Francisco. This article is reproduced with permission of TechNewsWorld and ECT News Network.