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U.S. cities set up wireless networks

Close to 1,000 municipalities worldwide have plans under way

Philadelphia (Pennsylvania)
Corporate Management
Emergency Planning

PHILADELPHIA, Pennsylvania (Reuters) -- A number of U.S. cities are becoming giant wireless "hot spots," where Internet users will be able to log on from the beach or a bus stop, a trend that's triggering a fierce backlash from telecom and cable giants.

"We look at this as another utility, just like water, sewer, parks and recreation, that our communities should have," said St. Cloud, Florida, Mayor Glen Sangiovanni, who hopes to provide free wireless service to the entire city by the fall.

At a conference this week, officials from dozens of local governments compared notes, listened to pitches from vendors and discussed ways to counter the lobbying of telecommunications giants that have sought to block them at the state level.

Free or discounted wireless service can spur economic development, improve police patrols and other city services and encourage Internet use in poorer neighborhoods, they said.

Slightly more than 100 U.S. cities -- as big as Philadelphia and as small as Nantucket, Massachusetts -- are setting up wireless networks. Conference organizer Daniel Aghion said close to 1,000 local governments worldwide have plans in the works.

The trend has prompted an intense backlash from the large telecom and cable providers that sell most broadband access in the United States. At their request, 13 states have passed laws restricting cities setting up their own networks, and several others are considering such bans.

"With so many other issues challenging municipalities today, why on earth should cities waste millions of taxpayer dollars to compete with carriers already offering high-speed Internet service?" said Allison Remsen, spokeswoman for the U.S. Telecom Association, which represents incumbents like SBC Communications Inc. and Verizon Communications.

City officials said they don't want to compete head on with commercial providers but aren't going to be held hostage to their profit concerns.

Providers have shown no interest in setting up broadband wireless service or offering free or discounted rates, they said. Sometimes they refuse to provide any broadband service at all.

"We begged them to deliver the service -- we didn't want to be in this business," said Scottsburg, Indiana, Mayor Bill Graham, who said local businesses threatened to leave his town before it set up its own wireless network.

The legal battles seem to have only increased interest among city officials, especially after squabbles over a Pennsylvania state law made national headlines last year.

"It helped to bring to light what the telecommunications industry was attempting to do," said Philadelphia technology manager Dianah Neff.

Others said the threat of a ban at the state level has spurred them to action.

"We're acting pretty quickly for a municipality of our size, because we don't like to be pre-empted," said Lindy Fleming McGuire, a Chicago City Council staffer.

Smaller wireless startups are rushing to provide the equipment and expertise needed to run city networks.

"Munis don't want to own this at all; they just want the service," said Robert Ford, chief executive of NextPhase Wireless, a service provider.

Rio Rancho, New Mexico, brought in wireless provider OttawaWireless because incumbents didn't reach many areas, assistant city administrator Peggy McCarthy said. Now that the network is up and running, the incumbents' service has grown more competitive, she said.

"The lethargy and apathy with which we had been given DSL and cable have both changed," she said.

Some cities, including Spokane, Washington, found they could easily set up wireless service when they upgrade their emergency communications networks with a little help from the Homeland Security Department. The federal department awarded $925 million last year for communications upgrades.

Copyright 2005 Reuters. All rights reserved.This material may not be published, broadcast, rewritten, or redistributed.

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