Fast-forward to 2007 and the surging popularity of the “free” municipal wireless network. Muni wireless sounded a clarion call to politicians everywhere, with the promise of free access guaranteeing fifteen minutes of national fame to the mayors of even the smallest hamlets. How quickly they forgot history! When the cost of building and delivering goods or services greatly and continually exceeds revenue, bad stuff happens.

Selling cheap wireless access services to consumers is wildly popular, but it’s a really tough business to make profitable. Giving away access in hopes of ad revenue is even crazier. How many dot-bombs relied on selling “eyeballs” to advertisers? Cities that demand that a third party build the network at its own expense, and then fail to become guaranteed paying customers, remove a big incentive for providers to build carrier-class networks.

EarthLink and MetroFi have put the brakes on the municipal dash to doom.

Thank heaven that EarthLink and MetroFi recently put the brakes on this municipal dash to doom by telling cities they need business models based on financial reality rather than brother-can-you-spare-a-network economics. Earthlink is reviewing performance of its current investments and setting tighter guidelines for accepting new projects. MetroFi is requiring government anchor tenancy before any freebies are offered. Local governments now have little choice but to face the music and find the money.

So where is the real business case for muni wireless, anyway? Look to the corporate world.

Think Like a Business

Commercial entities use WiFi to wireless-enable the equipment of employees whose mobility is primarily within company premises. The long-term cost savings and improved efficiencies from these deployments greatly exceed the investment. Why pay recurring wireless data costs for mobile workers when you can place access points on your own assets and use backhaul technology to transport data between mobile devices and the Internet or intranets?

Companies own the network infrastructure in the buildings where their people work. Since WiFi uses open standards, they can leverage old as well as new technology and avoid buying new infrastructure. They get broadband speeds that are faster than the speed of cellular data access, and they don’t have to pay monthly fees to those cellular networks. Businesses often recoup their WiFi investments in less than a year on the basis of this savings alone.

Employee productivity increases can recoup the costs of municipal WiFi deployments.

Shift to city governments. Instead of a plant floor or a business campus, a city employee’s workplace is that city’s geographic footprint. Just as a business owns the networks in its facilities, the city owns or can negotiate access to the infrastructure on which WiFi can be deployed within its boundaries. Its employees’ productivity and efficiency is greater with broadband than with slower cellular wireless data service. The city’s budget won’t be taking hits from per-worker or per-asset charges.

When viewed in this light, potential ROI is easy to find. If a social worker accesses data from the city’s computer network or completes paperwork digitally from a client’s home, the time and cost savings are similar to that of a plant manager accessing a server or completing digital forms from the plant floor. Wireless-enabling a parking meter to track and respond to payment activity has revenue-increasing potential in the same way that wirelessly tracking products on a store shelf increases revenues for that operation.

Cities must re-evaluate their business models. To achieve a return on investment, the government must have skin (money) in the game. Otherwise the resulting network may not be robust enough to support the applications that can transform government operations.

There are a dozen or more ways to finance WiFi networks besides using tax money, and a number of ways to cost-justify tapping into city capital expenditure funds. But before city managers can explore all these options, they must first understand the network benefits.
 

Show Me the Money

Social workers can see more clients. Building inspections take a week less time. Police officers can file reports from the field.

Given the cost reductions, productivity increases and even revenue increases that can come from muni networks, many cities justify the investment in deploying broadband wireless with these results alone. For example, Merton Auger, City Administrator for Buffalo, Minnesota, states that “before purchasing the network, our business planning for public works and public safety workforce applications determined that we’d have a five-year payback on the network.”

Government officials in my January Municipal Wireless Snapshot Report identified several key areas where muni wireless can show you the money:
 

Public Safety

Charles Hewitt (Providence, Rhode Island): “The ROI in public safety leans more toward the intangible, such as increasing police force productivity by making officers more efficient rather than adding bodies to the force. Officers can file reports, run license checks, do surveillance and conduct lineups in the field. This meets criteria established by the U.S. Justice Department’s Office of Community Oriented Policing Service, from which we got a grant for our network.”

Inspections

Leonard Scott (Corpus Christi, Texas): “Taking a week out of the building inspection process saves contractors huge amounts of money, and the City expects to save about $85,000 per year.”

Code Enforcement (Health, Building, Safety)

Bill Marion (Milpitas, California): “Code Enforcement workers who respond to various complaints, including barking dogs, can determine onsite ‘have we issued a notice here before?’ or ‘have there been other complaints?’ They can enter details directly into the permitting system and print violations, correction notices and notes and save an hour a day.”

Traffic Control

Ron Puccinelli (Concord, California): “Within the Traffic Management [Division], the network will provide value by enabling our traffic signal and control staff to monitor and control lights from their office. We can connect more light signals into the remote management system than we have now because we won’t have to run wires to those poles.”

Meter Reading

Merton Auger (Buffalo, Minnesota): “We have a service orders application for meter reading. People who move in or out, or feel the meter was misread, contact a clerk who enters details into the system. It automatically creates and sends service orders to a worker’s tablet PC. Workers enter data onsite that goes into the billing software. Benefits include time savings, instant information access and the gas we save. These workers drive gas-hungry vehicles such as trucks and large pickups.”

Social Services

Cindy Zerkowski (Macomb County, Mississippi): “Staff workers visit senior citizens to deliver various services. Our people have laptops, but many seniors don’t have Internet access. Workers could tap into the network while onsite to have even more productive visits. They could see more clients by being able to answer questions in their homes rather than going back to office to find the answers and calling people back or whatever else they need to do to resolve clients’ issues.”

Parks & Recreation

Carl Dresher (Tucson, Arizona): “Because of the expense, our people go out to the smaller parks for onsite monitoring since we can’t afford the data services costs of adding video feeds from these facilities. Once we can put all of the parks on the WiFi network, the network access costs will drop, plus field workers won’t have to go to those small parks.”

Here's the question of the day: are you going to make history or repeat history?

About the Author

Craig Settles, president of Successful.com, is a consultant who helps organizations maximize their investment in wireless technology. He is the author of “Fighting the Good Fight for Municipal Wireless.”