SF Municipal Wi-Fi Wait Grows

The next crucial votes on San Francisco's municipal Wi-Fi proposal will be delayed until next month while chosen contractor EarthLink Inc. becomes increasingly skittish about building wireless networks for cities.

After a request by EarthLink, Board of Supervisors President Aaron Peskin plans to push back votes currently scheduled for this week until well into September. Peskin has proposed amendments to EarthLink's proposed contract with the city that could help move it through the board, which has final approval on the network plan and has been sharply divided.

Peskin said late Monday he plans to move a vote by the board's Budget and Finance Committee to Sept. 12. That committee vote, on whether to send the plan on to the full board, had been set for Wednesday after several earlier delays. Meanwhile, the full board had been set to vote Tuesday on whether the project should continue to be exempt from an environmental impact report. Its vote, also postponed several times, would be pushed back to Sept. 11.

San Francisco's municipal Wi-Fi project, originally proposed in 2004, is one of the most closely watched in the U.S. It would include a paid service provided by EarthLink and a slower, free service from Google Inc. The plan has run into a thicket of objections concerning privacy, health, quality of service, help for disadvantaged residents, the city's role, and the process of conceiving and approving the project. Plans elsewhere in the country, including in Philadelphia and Sacramento, California, also have run into problems and delays.

Meanwhile, EarthLink has scaled back its nationwide plans for municipal Wi-Fi networks as it grapples with the vagaries of this new type of business and with its own financial problems. Last week, EarthLink's recently appointed president and CEO, Rolla Huff, said the company's municipal network business as currently conceived can't make enough money. The business is now under review.

"Until we're confident that we can build new networks and get an acceptable return, we will delay any further new buildouts," Huff said on a conference call following EarthLink's second-quarter earnings report. The company lost US$16.3 million in the quarter, which ended June 30.

EarthLink now plans to ask cities that want municipal networks to sign up as anchor tenants, committing themselves to buying service for their own operations, Huff said.

San Francisco isn't ready to become such a tenant, according to Peskin, who said EarthLink raised the issue with him several weeks ago and he ran it by city IT officials. The government doesn't have enough Wi-Fi equipment to make use of the services it would be buying, he said.

"We still have people filling out paper in the police department," Peskin said. "Someday we'll get there, and the city could be a user, but it's not, at this point, the best use of our money."

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