Subject: [NEXTEL-1] Baltimore Business Journal - "Wi-Fi worries: Pilot project stalls; critics say city wireless effort hurt"

From: [email-masked]
Date: Wed, 26 May 2004 18:07:38 -0400

-------- Original Message --------
From: Anthony Townsend <[email-masked]>
Subject:  Baltimore Business Journal - "Wi-Fi worries: Pilot project
stalls; critics say city wireless effort hurt"

Wi-Fi worries: Pilot project stalls; critics say city wireless effort 
hurt
By Robert J. Terry
  Baltimore Business Journal
Updated: 8:00 p.m. ET May 23, 2004

  Eight months after a high-profile launch, efforts to build on 
Baltimore's first free wireless Internet "hot spot" have cooled.

City officials say the deliberate pace is by design. But critics of the 
city-led initiative -- entrepreneurs who have launched nascent startups 
offering Internet access through networks built with wireless fidelity 
technology, or "Wi-Fi" -- say the languishing project is hampering what 
little business development momentum they have.

  A pilot project called "Baltimore Unwired" was launched last September 
by the city to study the usefulness of a free wireless network in 
public places such as the Inner Harbor. The thinking was that the free 
"hot spot," which transmits data over short distances using radio 
waves, could be used to market Baltimore as a tech-savvy location.

  Proponents say it has done just that. What it has also done is rile 
some of the region's wireless Internet companies which, rightly or 
wrongly, view the city as a competitor.

  These companies are under pressure to make their business models work. 
While research firms such as Gartner predict the number of Wi-Fi users 
will jump from 9 million last year to 30 million by year end, it 
remains to be seen how successful companies will be turning those users 
-- who take advantage of "hot spots" in coffee shops, hotels and 
airports -- into paying subscribers. A Wi-Fi company would become much 
like Comcast is to Internet access.

  In fact, industry volatility appears to have undercut one 
Baltimore-based player. Oneder, one of the original handful of startups 
launched with an eye on providing wireless Internet access, is up for 
sale, according to two sources close to the company.

  Keith Walter, one of Oneder's founding partners, recently left the 
company. He's working as a consultant with companies trying to break 
into the region's wireless marketplace. One, New York City-based 
Courtroom Connect, launched a Wi-Fi network in Baltimore City Circuit 
Court May 12.

  Wi-Fi remains a tough sell to investors who might be interested in 
backing such ventures because they remain skeptical of its 
revenue-generating capabilities. But Baltimore's Wi-Fi startups counter 
that industry trends point to an upswing in the wireless Internet 
adoption curve: Laptop computers, personal digital assistants and other 
devices containing the technology needed to access the Web wirelessly 
are expected to jump from 8.2 million to 25 million by 2006, according 
to Jupiter Research.

  Walter and Hugh Bethell, general manager of Port Networks, another 
Wi-Fi startup, are convinced the pieces are in place to light up a 
robust network of "hot spots" around town. But both are critical of the 
city's leadership in building on its Wi-Fi foundation, launched with 
the help of Accelacom and Legal Technology Solutions, two local 
companies which donated equipment and services.

  Bethell laid out his concerns in a recent letter to Mario Armstrong, 
the Baltimore City technology advocate and point person for the 
initiative. With only one access point on public property and no plans 
for more, Bethell wrote, why not let local Wi-Fi companies put access 
points on city property and split the revenues?

  "By entering into revenue-sharing agreements with local Wi-Fi 
operators, the city could expand wireless coverage, support its 
business community and make some money, all at the same time," Bethell 
added.

  Walter said the city should have sat down with all the local Wi-Fi 
players to figure out "who's got coverage, leverage that and build some 
general content that would be useful for people."

  "I really don't see it taking off," he added. "Where are you supposed 
to use it? Sitting on a park bench [along the Inner Harbor], in the 
heat?"

  Armstrong said the city took great pains to avoid being in direct 
competition with wireless Internet companies. The "hot spot" was part 
of a pilot, he stressed, not part of a strategy to blanket the city 
with Wi-Fi access.

  He conceded the city hasn't identified "where we're going next" with 
its "hot spot" strategy, but said "it definitely still makes sense and 
the ambition hasn't changed."

  Several cities and community development organizations have undertaken 
projects to create Wi-Fi "hot zones" stretching from blocks to miles. 
OneCleveland covers one square mile near Case Western Reserve 
University. Officials expect to offer free Wi-Fi access over 10 square 
miles by fall.

  Long Beach, Calif., launched a "hot zone" to attract new businesses to 
the city. And a group based in lower Manhattan set up free Wi-Fi 
service through several hot spots encompassing office buildings and 
parks.

  "Really it's in the hands of the city now as to what they want to do 
with it," said Christopher J. Camut, vice president and general manager 
of Baltimore-based Accelacom, which provided Baltimore UnWired's 
broadband link to the Maryland Science Center and a Wi-Fi link for the 
Inner Harbor. "It's a good technology but you've got to have users."

  Port Networks' Bethell said there is more awareness in Wi-Fi, and 
replacement cycles for computers means more of them are being shipped 
with built-in wireless Internet technology. His company is building out 
access points at the five main marinas downtown and working to add 
apartment buildings and other multitenant addresses as customers.

  Having a partnership with the city "would give us a leg up," Bethell 
added. But Paul Dowling, president of Towson-based Believe Wireless, 
considers Baltimore Unwired an unwelcome competitor, despite the city's 
best intentions.

  "I was expecting them to do more with it," he said. "I'm glad they 
haven't."
  © 2004 Baltimore Business Journal

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