April 03, 2007
City WiFi details emerge

The city WiFi contract is on the Council agenda tomorrow, and the Chron has some details from the contract.

The City Council on Wednesday is expected to consider a $2.5 million contract with EarthLink Inc. that would allow the company to build the city's wireless network and agree to be its "anchor tenant" for the first five years of the project.

While the agreement allows Mayor Bill White to keep his promise of not using taxpayer money to build the network, the city would be required to pay the company at least $500,000 annually for five years to use the service.


Under the contract, EarthLink must provide outdoor coverage to 95 percent of the city's 640 square miles and indoor service to 90 percent of the residential and commercial buildings in that area. The company is expected to invest nearly $50 million in the two-year buildout.

Access to the network would allow city and emergency workers to complete jobs in the field using wireless devices.

Certain inspectors already work out-of-office, but applications on the wireless network would expand the possibilities, making city government more efficient and effective, [Houston's director of information technology Richard] Lewis said.

City officials had initially hoped network access would be free for city government. But once discussions were under way, it became clear that wasn't feasible, Lewis said.

"What we came to understand was that the players in this field really need the city government to be an anchor tenant for network use," he said. "That way they can finance the project."

The City Hall blog cites this story from last March for the point about the service once being touted as free, but notes that idea was dropped months ago.

But some locals are critical of that decision, saying it's an indirect way of putting taxpayer money into the project.

"There's a hidden cost," said Barry Klein, president of the Houston Property Rights Association. It's not prudent to invest in the project without first seeing whether it works, he added.

The city will get some money back from the deal: $1,200 a month for each rooftop where EarthLink installs its transmitters, plus 3 percent of subscriber revenue starting in the third year.

So if the city leases out 35 rooftops for transmitter installations (not an unreachable number, I'd say), it will more than cover that $500K per year, and that's before any subscriber revenues come in. I'm not seeing the problem here.

And if EarthLink defaults on the agreement to build the network, it would owe the city up to $5 million.

Municipal wireless experts said the contract appears to cover all the bases.

"It looks fair," said Esme Vos, founder of MuniWireless.com, which follows projects in various cities. "There's something for both sides."

Craig Settles, a consultant not affiliated with this project, said the city was smart to agree to serve as EarthLink's main customer because that helps ensure the company's success, which in turn benefits all city residents.

"They seem to have avoided the kinds of things that have plagued other cities and their projects," Settles said, adding that EarthLink's proposed rates for Houston city government are decent discounts.

Sounds good so far. Newswatch, which summarizes the deal, says they'll post a copy of the contract later today. I'll look for it.

UPDATE: Cory points out that the $1200/month rooftop lease would go to building owners, not the city. Which makes sense now that I think about it.

Posted by Charles Kuffner on April 03, 2007 to Elsewhere in Houston

It is a good idea, but I'm wondering why Jared Woodfill isn't all over it, complaining about this $500,000 annual outlay by the City? Do you suppose he realizes that it would be an enormously popular government service, shooting down his "cut taxes, cut services" rant?

Posted by: Dennis on April 3, 2007 12:15 PM