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Municipal WiFi Costs Outweigh Benefits
TheSync writes "JupiterResearch claims that muni WiFi costs outweigh benefits. It can cost up to $150,000 per square mile over five years, which may not even provide each user a benefit of $25 a month. They suggest that such projects only be taken on as public-private partnerships."
First, the article says the average cost is $150,000, not up to $150k.
Second, it says an assumed $25/month benefit, not that it's not even $25/month. Also, Internet access costs me $40/month, so...
Third, it says the first five years, which includes all manner of infrastructure creation. Even a major network upgrade would likely cost less later on, because you don't have to find locations, put up towers, etc. I'd like to see the per year estimates, but I'm not subscribed to Jupiter's service.
If your town/city is going through the work and effort to build this manner of network, hopefully someone is going to notify your citizens and try to get them onboard. By Jupiter's reckoning, it takes an average 100 users per square mile to cover the costs. Now, if your city/town put any real effort into this project, you'd probably let people know that free Internet access is a $40 network card away. Get local computer stores to stock up on the cards and ask them to chip in on an ad campaign. They can offer a flat-rate installation service (with caveats for running into problems, etc)
That what was all this school was for... to teach us how to solve our own problems. -- janeowit
Until you get a fabric network that covers multiple square miles per basestation (a la WiMAX) You'll not see a municipal implementation over a metro area.
Sure there are exceptions (where town.size approaches zero) or (starbuck.count approaches infinity) but this is just the economics catching up with the technology.
If you've got a connection at home, and you've got a connection on the Bus, and you've got a connection via your cellphone, and yuo've got a connection via your coffee shop, why does a city have to be 100% covered by 802.11a/b/g? GPRS/EDGE/3g/future can (and initially will) pick up the slack.
"Draco dormiens nunquam titillandus."
Hear me before it is too late! SHUN the evil of the Three P's, Public Private Partnership! Turn ye either to the left, to publically funded projects, or to the right, to the blessed land of private enterprise -- but walk not the middle path, the path of the Three P's!
Once, this land of England was fair and pleasant, with mighty Industry and caring Government working hand in hand! Then came the Three P's! They promised us cost savings and social responsibility, but they delivered nothing -- nothing save gigantic invoices and permanent damage to the environmental and social fabric of the nation!
Turn aside, oh turn, I beg you, America, from this path of wickedness! For the evil of Bloated Government Inefficiency is in them, and the sin of Greedy Private Contractors they likewise have! And the private half shall spend, yea spend and spend, and the public half will know not nor care where the money has gone!
Repent therefore, repent before they do unto you as they have unto Europe!
My words have the semblance of jest, but the danger is deadly serious.
Whence? Hence. Whither? Thither.
I don't know about anyone else but I'm getting skeptical about anything I read from Jupiter, Gartner or any of the big research firms. It's usually being paid for by someone with an agenda and, no surprise, the research tends to support the conclusions the customer wants. After a while you just stop paying attention to them. They've sold their credibility.
That's our life, the big wheel of shit. - The Fat Man, Blue Tango Salvage
This study needs to be looked at very skeptically, because there is a lot of money right now trying to discourage municipal wifi systems. Why? Because any new legislation being pushed by the telcom companies to ban municipal wifi as unfair competition would have to grandfather in any existing municipal wifi systems and allow them to continue to operate and even expand.
Many of the Wifi activists (Boston Area Wireles for example) are trying to convince local governments to at least establish a single note public Wifi system just so that they can continue to operate if the telecom industry manages to outlaw public networks.
It's pretty obvious which side of this battle has the money and motive to pay for "independent" research.
-braddock
This "research" is almost certainly bought and paid for by the telcos.
Common sense will tell you that muni wifi is a good thing for you and me and a bad thing for the telcos. If the costs of muni wifi outweigh the benefits, then why are the telcos spending so much money buying all this legislation to outlaw muni wifi?
Also, there are cities that have already implemented muni wifi, therefore why not go loko at their implementation, and SEE what the costs and benefits are? Why bother with this fake research? And did the telcos pay Slashdot to run this article?
eat shiat and bark at the moon
I love this reasoning. "It's too expensive to be worthwhile, so please pay a private firm to do it."
Mind the Gap
I got the jist that it was along the lines of: "No, no, no, don't do WiFi yourself, it just costs too much. We'll do it for you have save you $$$$ millions!"
Believe it or not, there are tons of companies right now working to setup such private/public partnerships with a lot of cities either considering doing it themselves or still on the fence about it. This article reaks of being a marketing piece for those companies.
My blog
let's take the $150,000-over-5-years and $25/month-per-user benefit numbers at face value (ignoring the comments of earlier users in here). somebody check my math:
$25/month = $300/year = $1,500 over 5 years
1500 * 100 = 150000
so they just need to get 100 users per square mile to break even, given these assumptions? am i the only one who finds these numbers to be a tremendous argument for benefits outweighing costs? add to this the fact that most people are paying more than $25/month for internet access, and i think that's exactly what this shows.
i speak for myself and those who like what i say.
150,000 per square mile over 5 years.
so that works out to 150,000/5 years/12 months = 2500 per square mile per month.
Which means that if you have 100 users in a square mile, which is far more than reasonable, you will be getting equivalent costs to benefits.
Let's say I misunderstood it, and it was 150,000 per square mile per year over 5 years. So then it would be 150,000/12 = 12500 ~ 500 users would be needed, again, really small number for a large city.
Finally, let's say I'm completely wrong and that 150,000 is per month. Then it would require 6000 users for there to be benefit. Which in a city like New York or San Francisco, is far more than reasonable.
Unless, of course, Jupiter is stating something way off, their math makes no sense at all. The cost they are giving is way more than reasonable for the benefits to the general population.
~ kjrose
A well-managed public service will always be more cost-effective than the same service provided by a well-managed private operation, because there's no profits being taken out before the bottom line. That's basic math.
The trick of course is getting the public service to be well-managed, but that's mostly just a matter of political will. The local Chamber of Commerce will of course pooh-pooh the very notion and sometimes even stand in the way of it, because their interest is in creating niches for private businesses to exploit instead. And of course employees (especially if organized) will try to get as much out of it as possible as well. The government just needs to show some backbone and do it right, regardless.
The only reason a private entity truly needs to be involved is if investors are needed for the capital, and the government doesn't have the means to raise it through bonds or taxes. Otherwise, let the public sector hire the same people to do the same job at the same salary/wages the private company would have hired them at. If the argument is ideological (that government shouldn't do this sort of thing) that's another matter, but if it's a question of accounting, the advantage is to the fully-public approach.
http://alternatives.rzero.com/
THe elite like globalization. But it hurts us.
Any evidence on this? Free Trade and globalisation have certainly driven up the quality of life in pretty much all of the west, and is beginning to help elsewhere.
The elite like lots of immigration. But that hut
rts us working American citizens.
Now this is just plain crap. You do know what Ellis Island was don't you? Immigration does NOT hurt working Americans, it HELPS by increasing the GDP of the country and aiding in growth, it also provides people for the jobs that help your quality of life but you would never do (Strawberry picking in CA anyone?).
Its amazing how Americans can say that Free Trade and Immigration are bad, when these are EXACTLY the things that made America great. Absolutely Amazing.
An Eye for an Eye will make the whole world blind - Gandhi
Why does everyone try to reduce every question to money alone? Oh yeah, they're selling stuff.
Governments should strive to provide services for as little cost as possible, but that doesn't mean that it should fail to provide a service at all if just because somebody declares it to be not cost-effective.
Guess what, public libraries are not cost-effective.
Public parks are not cost-effective.
I'm sure others can add their own examples. Cities provide these service because it benefits the residents and makes the city more attractive to others. E.g., it might encourage a company to locate new offices in this city instead of another to keep the employees happy, and unlike the usual "development incentives" these investments actually benefit the people, not a few executives.
Should cities provide wifi - even free wifi - in downtown and business areas? I think it should - because the public good (e.g., allowing people to check their email from anywhere in the area) outweighs the cost. If the city really, really needs to offset the cost it could impose a nominal head count on the employees in the area, and by "nominal" I mean $2/month/full-time equivalence person. It won't cover the entire cost but it's a symbolic gesture.
For every complex problem there is an answer that is clear, simple, and wrong. -- H L Mencken
Welcome to the United States, where your taxes pay for things you don't want. I don't want a war with Iraq, I don't want money going to "faith-based inititives", I don't want churches to get off without paying their share of taxes.
Even going beyond things I find morally problematic, I can't opt-out of paying for schools just because I don't have any kids. I can't opt-out of paying for garbage disposal if I were to recycle 100% of my trash. We live in a community, and as members of a community, our tax dollars pay for civic projects for the greater good. I believe internet access to be one of them.