MetroFi exec: Free Wi-Fi is not dead yet

Company to leave nine cities, says new financial models needed to support muni Wi-Fi

MetroFi Inc. is pulling out of nine cities where it operates municipal Wi-Fi networks in the next 30 to 60 days, including Portland, Ore., but a top executive for the private venture claims that the free Wi-Fi movement is not dead.

"We're disappointed, but we believe free Wi-Fi is going to happen despite this," said Lucie Poulicakos, MetroFi's vice president of operations, in a telephone interview today. Poulicakos said MetroFi's founders believe that for free Wi-Fi to become a reality, however, cities and towns must invest to cover part of the cost, such as Wi-Fi network costs for police and municipal worker services.

"Cities need to spend a little to get a lot" and share the costs of building and operating the network with the private sector, Poulicakos said. "This is costing us a ton of money."

Mountain View, Calif.-based MetroFi's decision to withdraw, made late last week, follows closely on the decision by EarthLink Inc. to end its Philadelphia Wi-Fi service, after EarthLink earlier pulled out of San Francisco and New Orleans.

MetroFi is seeking to sell its networks' assets after investing "millions" of dollars across nine cities and hopes to find new operators, Poulicakos said. There is also the possibility that the cities themselves will operate the networks, although one of the nine, Concord, Calif., has told MetroFi that it is not interested in operating its Wi-Fi network. The California cities of Foster City, Santa Clara, San Jose and Sunnyvale have expressed interest in taking over the networks, she said, although the cities could not be reached immediately for comment.

In all, MetroFi had about 30,000 subscribers on its nine networks, which were going to be funded primarily by advertising. The San Francisco Bay area communities using MetroFi were built out and include Concord, Sunnyvale, Foster City, Cupertino, Santa Clara and San Jose, Poulicakos said. In Portland, Ore., MetroFi's biggest project, construction stalled months ago after about 30% of the network had been built. Two Illinois cities, Aurora and Naperville, had trial projects under way.

Discussions with the mayor of Portland and other city officials are under way, with the "potential" that a third party will take over the MetroFi network there, Poulicakos said.

Technical problems arose in MetroFi areas, including the need for repeater devices to get a clear Wi-Fi signal. But Poulicakos adamantly said that technology was not the limiting factor. Many people have suggested that cities and towns need to invest in municipal Wi-Fi, especially for low-income residents to use, just as governments invest in roads and public transportation.

But Poulicakos said government does not need to bear all the costs. "It's not that municipal Wi-Fi should be a government program, but we believe the private sector should provide it with the city for the city's day-to-day operations," she said. For example, MetroFi has helped build a municipal Wi-Fi network in Riverside, Calif.; AT&T Inc. owns the network, which the city is leveraging for municipal workers, she said.

Esme Vos, founder of Muniwireless.com and an analyst on the subject, has urged greater government spending on Wi-Fi projects. In a blog, she said that cities where Wi-Fi projects have not taken off could have required private coffee shops to install Wi-Fi access points in return for low-cost broadband access. "Just give it a push like this and you have citywide Wi-Fi," she wrote.

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