Municipal WiFi Should Not Be Allowed

Looks like muni wifi is getting serious. I don’t agree that a city should compete against the private sector with a service like this though. They don’t offer free electricity to the poor or heat or phone or any other utility. It will be interesting how it all plays out. Philly announced Earthlink as their provider. They were the first city with the idea (was stuck in court forever).
Let me expand on how I think cities offering WiFi is a.) a new paradigm for government and b.) bad for business.
a.) There are no other examples out there that I know of where a government entity is providing a utility service to people for free
– Television stations are private entities providing a service to customers. While this service is free (over air broadcast), it is paid for by advertisers. However, the government has no involvement or subsidization in this business venture.
– Since WiFi does not include “content” it acts more as a utility such as electricity, water, sewage, or phone service. None of which are provided free by municipalities.
– With respect to the telephone company, there again you have no competition from any municipalities. Now, this is an obvious monopoly within any given area and to counter that the FCC has required telephone companies to a.) provide plain old telephone service (POTS) to all rural areas at a reasonable price (federal law; costs of which are subsidized by urban areas), b.) rates have been regulated and monitored to not abuse this power. (In 1996 the FCC went further and forced all incumbent telephone providers to provide access to their switches/networks in order for competition to be created (Competitive Local Exchange Carriers or CLECs)). A somewhat similar paradigm to this offering would be SF asking Google to build a telephone network wired to every home and provide service for free.
– Telephone companies can leverage their channel more though as they can provide additional services over the same lines (e.g., broadband, TV (coming soon from SBC))
– Electricity companies are still trying to get the technology to provide broadband over their lines. Yet, it looks like broadband over electric lines is ready to go per a press release today
b.) Providing free broadband competes directly against telephone, cable, TV, satellite, cellular and electricity companies.
Telephone – I pay about $20 a month to SBC for my DSL. I would not if this service was launched.
Cable – many folks get broadband from their cable company. guessing they wouldn’t pay for it when this was launched (this eliminates revenue…jobs…)
TV – television stations are required to make the leap to digital broadcasting by the end of this year. the spectrum allocated for this and the technology would allow them to send data along with the video signals. new business models they haven’t quite dreamed up yet would be impacted
Satellite – also provides broadband access
Cellular – carriers world-wide have made significant investments in 3G networks (billions). they would likely never achieve a return with a free competitor as you wouldn’t need the cellular companies to provide this if it was free. not to mention, when it was available you’d get Skype and use it as a phone too, so now you’re not paying for your mobile phone or broadband (eliminates revenue…jobs…)
Electricity companies – well, they’re old. but if they ever really get into convergence (lot’s of wires that could do lot’s of things). they won’t be able to compete if there is already a free channel
Would I like to have free WiFi? Yes! But, I see way too many businesses that could be dramatically impacted by this paradigm change in our local governments, which I think would ultimately affect jobs, which will create even more people that can’t afford the digital world. But hey, I guess they’d still have WiFi!

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