Apple iPod; Muni-Wi-FiFriday, August 10, 2007
It’s strange to be writing about the Apple iPod, one of the most successful products in the history of the world, and not about wireless. My son, who is currently stationed in a Middle East war zone, had his iPod quit on him. After emails back and forth between us, we determined that the problem is probably the battery. He went to Apple’s Website only to find that he has to be in the United States in order to get the problem resolved. His comments―“I figured it was the battery, as it's a 2006 model, and Apple even states it has had problems, even a virus in some, 25 reported cases for the Windows model, and Apple has taken responsibility! Now that's a good company, I've always liked Apple! If I could find a way to email the right person, I would request a military-only Apple Website for customer support to enable deployed military to receive better service. Apple has a big following with the iPod in deployed troops. Not sure if it has figured that out yet. It’s a big marketplace with great word of mouth advertising!” Okay, Apple, the ball is in your court!
The last time I mentioned muni-Wi-Fi, I simply quoted the new CEO of EarthLink saying that until it can find a better business model it will be curtailing its rollouts. At risk are San Francisco and Philadelphia among others. In a recent article in TechNewsWorld, “Ground Shakes Under San Francisco’s Municipal WiFi Project,” the publication questioned whether the City by the Bay will ever see a muni-Wi-Fi system installed. Quoted in the article is a noted economist and senior research fellow at George Mason University in Virginia―“Two years ago, it was a very viable concept, when broadband was so expensive. Now, though, you can get DSL for less than $20 per month.”
This article was sent to me by a reader who states, “Andy, once again, hits the bull’s-eye with his predictions and commentaries.” While I would like to take credit for being clairvoyant, what I have written about muni-Wi-Fi systems is simply common sense: You cannot take a local-area technology, in unlicensed spectrum where anyone and everyone can put an access point, and turn it into an urban gold mine. It simply is not feasible. Thanks for the compliment, I do appreciate it, but it is just plain logic.
The article goes on to blame politics for the delays in the San Francisco system but also states that only in smaller, rural systems, which are only served by dial-up, has there been any real success. It states that as of August 1, 2007, there were 415 cities and counties in the United States in the deployment/planning phase or with networks up and running. And that, according to muniwireless.com, the total will soon reach 455.
So the issue still remains. Who is making money in this business? The article cites Corpus Christi, TX as a municipal network that was paid for by the city and developed by Northrop Grumman, at a cost of $25 million, and that it provides automated meter reading and Internet access managed by EarthLink.
The bottom line here is that trying to turn a local-area technology into a wide-area technology, especially in the unlicensed portion of spectrum, has not proven to be an effective business model.
The proponents of unlicensed access don’t seem to realize that having a network in unlicensed spectrum is akin to not having a lock on your door. Anyone who wants to can enter the premises, and the more people who do, the more problems the networks have. Meanwhile, my favorite intersection in San Francisco is now up to 52 access points, 18 of which are open access. How many access points will a city-wide network need at that intersection to combat all of these other access points?
The article states that the first systems misunderstood the number of access points needed to provide coverage, and I have discussed this before. The model was 30 access points per square mile. The new model is 62 access points per square mile, blowing a real hole in any return on investment models!
Expect to see more articles like this as more major metro areas try to make things work and try to find a business model. As I have said before, access points will certainly cut down on the amount of asphalt needed to fill potholes when the systems are dismantled.