Saturday, May 06, 2006

Surviving the Muni WiFi Roller Coaster

This is my column published May 5 in Fierce Wireless

There’s a crazy roller coaster ride we often endure when some new “revolutionary” technology hits the scene. First, there’s the rush of ascent as promises of “unparalleled benefits” gush forth from the marketing minions and analysts. The media picks up on the trend, anoints it The Next Big Thing and on up we race.

Then comes the rapid gut wrenching descent as average users of the technology start discovering what should have been some obvious flaws. The pundits and media pick up on this and start widespread hang wringing as we’ve seen recently with negative media coverage after muni WiFi networks went live in Tempe, AZ and St. Cloud, FL. Poor San Francisco has become a disgruntlement dart board and they haven’t even signed a contract.

Let’s level out this roller before we get emotional whiplash. Here are some lessons for those actively participating in, or following with interest, these muni wireless initiatives. Vendors, consultants and service providers. You have as much responsibility as cities do to encourage putting these into action. You’re profits are riding this same roller coaster.

Lesson 1 - Don’t allow others to declare your network a flop. Remind people why you’re building the network. Of the four primary reasons cities deploy municipal networks – government use, digital inclusion, economic development, general public wireless Internet access - providing cheap access is the least financially defensible. Yet, it is continually the tail that wags the dog, particularly with this being an election year in many municipalities.

St. Cloud’s original business case for owning the network rested on cost savings to be generated by using the network to increase mobile city workers’ efficiency and productivity. The money that would otherwise go to hiring new employees to handle increasing workloads by itself is enough to offset annual network operations costs.

Cities would do well to shift discussions in the media away from whether or not people are having trouble getting coverage in their homes, and focus on how the network is impacting government work. From day one, the purpose of Philly’s network is to increase digital inclusion and economic development. The measure of their success should be how lives and businesses are being helped in disadvantaged communities.

Lesson 2 Better manage expectations. Early feedback about Tempe’s deployment criticized people’s inability to get coverage everywhere. But go back and review public proclamations by politicians, vendors and others when Tempe announced they were going to deploy. You see the problem right away. Officials wrote, or allowed others to write, expectation checks that the bank of technology reality can’t cover.

In the beginning all you heard was “first in the nation,” “wireless everywhere,” “free for everyone.” But did they talk about needing signal boosters in homes to get better coverage? Were there warnings that the technology will take a few months after going live to get the bugs worked out? Often, government officials just don’t understand the technology or its limitations.

Unless and until cities realize that poorly managed expectations pave the road to eventual constituent backlash, the minute you go live there’s going to be hell to pay. And the whole world will read about it. It doesn’t matter if the network is “free.” or owned and operated by a private company. When people are pumped on expectations that the network or the business relationship with the vendor cannot deliver, bad things will happen.

Lesson 3 - People, reign in your politicians. This is an election year for many municipalities. “Free municipal WiFi for everyone” is a great hook upon which to hang a few political hopes. It’s the 21st century version of the 1928 promise of “a chicken in every pot.”

However, broadband wireless is too complex, citywide WiFi is too new and examples of cities doing it right” are too few for the technology to live up to campaign promises, or conform to the timeline of the campaign season. Most politicians know too little about technology and care too much about looking good for voters to drive key initiatives.

Use the mayor to get the initiative off the ground, bring them out occasionally to maintain its momentum, and have them show up to take final bows when the network goes live. But have the CIO or someone in IT out front leading the public discussion. Or have a multi-constituent steering committee drive setting expectations. However, if you have someone like Philly’s Mayor Street who is a gadget freak, technology literate and not running for re-election or higher office, they’re less likely to be a loose cannon.

Lesson 4 – Find a PR strategist. No, not a press secretary, not a spin doctor. Get someone who knows how to craft messages, position products or services, keep people in various parts of the government on the same page with those messages and build consensus among constituent groups.

Hundreds of municipalities are about to roll out a major new technology solution that’s going significantly alter how business gets done in those cities. In a local way, treat initiatives the way Microsoft, IBM, Palm and others treat their products. Build anticipation, set realistic expectations, educate the market. There are enemies of muni WiFi who will broadcast every flaw and scar. Cities and their supporters must drive the public discussion, not their enemies.

Lesson 5 – Maintain transparency with those whom the network is supposed to serve. If it’s not careful, San Francisco could become an embarrassing footnote in the short history of muni WiFi as the only city initiative to be temporarily derailed by the technology’s main supporters. Regardless of the reality, S.F. is perceived locally to have acted hastily, with disregard to community needs and wishes, inspired by political cronyism and without any credible amount of technology due diligence.

From pre-RFP to post network deployment, any city that’s serious about using muni wireless to improve government and/or the lives of its constituents must have a transparent and responsive implementation process. As Mayor Street advises in my book, “conducting this initiative transparently and in the public...will go a long way towards helping to build consensus among different groups and constituencies.”

Monday, April 17, 2006

And now, a word from our muni WiFi sponsor

A little-noticed item that came from the S.F. muni wireless bid process was a plan by a team comprised of SeaKay, IBM and Cisco. Cities, take note of this before you auto-lock into the concept that every private-ownership model for the network has to be driven by ad sales. It’s early enough in the game to consider other potentially better business models.

IBM and Cisco teamed with Seakay, a consulting firm that helps non-profits bring technology to underserved communities. Their business model proposed to cover the deployment and on-going operations cost of the network with corporate and philanthropic contributions (alla NPR), and direct sponsorship. Other cities are considering this option.

You can make a strong case for sponsorships. Sponsorships are not the same as ads. When Ford Motors runs a TV ad, various people see it among many other ads at various times. Impressions are fleeting, brand building is slow and there’s not much prospect interaction with the advertiser. You often have to run a lot of ads to get good results.

But if Ford sponsors the annual Lowly County stock car championship races, they “own” the event. Every ad promoting the races is an ad for Ford. Every attendee sees the Ford name all day, and they might get a Ford-branded bag of goodies to take home. When the races are broadcast on TV or radio, every 5 minutes your subconscious is pinged with “here at the Ford stock car championship.”

With muni WiFi networks, sponsorship is ownership of customer relationships without the hassles of owning the network. For the city or service provider, finding several sponsors is a guarantee of huge blocks of capital. Would you rather ask 1000 businesses for 100 each, or ask one business for $100,000? Vendors build better networks because once you lock in a few sponsors, vendors aren’t worrying so much about getting enough ad sales or subscriptions to recover their investment.

Let’s list the reasons why this makes sense – and potentially many dollars. (E-mail me if you want some scenarios for how muni wireless sponsorships can work –

Sponsorships are more attractive for some companies. Though companies obviously buy ads because they work, muni WiFi ads compete with local newspaper, radio, etc for their ad dollars. Does being rotated in with 100 other WiFi advertisers offset taking money from other media? But if you own the identity of the network the same way Staples owns the identity of the Staples Center in L.A. that’s home to the Lakers, Kings, Clippers, Sparks, Avengers and hundreds of events a year, you reap *huge* amounts of 24/7 publicity, promotion and ad impact.

Interactive ties that bind. There is no (and I mean zero) end to the ability of a sponsor to create content and interactive online features that 1) draw repeated use of the network, and 2) wrap users in a cocoon of daily relationships with the sponsor that users actively pursue.

If I’m Nokia and I own a network, I have a whole city of present and future gamers for whom I can create mini-games, special content, group chat areas, etc. If I’m the city sports franchise, the network’s an awesome channel for delivering content to create and maintain rabid fans. The local health care conglomerate? It’s all about cradle-to-grave health and wellness content plus personal reminder alerts for medical check ups.

Perfect complement to other funding. Secure block grants from federal or state sources (i.e. Homeland Security) to build out your network for public safety applications. Then bring in a sponsor to provide funds to enhance the network for public access and other general public uses. You get a very solid core network developed then enhanced and maintained without a lot of financial risk.

Mix & match your sponsorship sources. Bring in the philanthropic sponsors to fund part of the network, plus the content, community and business portals, applications and other elements necessary for digital inclusion or economic development programs. Look to a company such as Chevron Energy Solutions (a unit of Chevron Oil) to sponsor part of the network for public works applications, as is the case in Burleson, TX

Chevron Energy Solutions markets consulting services to cities that help them make better use of water, energy and other utility resources. They decided to underwrite some of the expense of Burleson’s network that will facilitate automated meter reading. Chevron get exposure that helps them sell services here and to other cities.

The bottom line

There are a bunch of cities that don’t have, or don’t want, to spend the money for municipal broadband, yet they all want broadband. You have the vendors, many of them relatively small businesses, upon which cities are putting all or most of the financial responsibility for the network. Building a useful network requires money. Maintaining and upgrading it requires yet more money (see my following post on the economics of ad sales).

Sponsorships offer a practical path to get the money that cities don’t have, and that vendors need if you want them to build and maintain a network without going out of business. The challenge is that this requires creativity, sweat equity and going against the current popularity of the ad-driven business model. So much easier, it seems, to bring someone in and let them deal with everything. The smart cities, however, should at the very least seriously explore the sponsorship option.

How to be the Hero (a.k.a. It sucks to be the goat)

In six months to a year, those driving these initiatives are going to be the hero or the goat in their respective cities. In government IT, you only need to be the goat once and stock in your career gets greatly devalued if not de-listed. Here’s some help to land you in the Hero camp.

I believe totally in the importance of asking the right questions. Most managers who do so, and have the will to act forcefully on the answers they get, end up with technology investments that deliver positive payback. Those who avoid the tough questions or fail to accept answers they don’t want to hear get bad technology results.

Is your vision ok?

In my report on the true price of free muni networks, a city CIO who is negotiating a contract with a company that plans to use the ad-driven model also says about it “To be honest, I have my doubts about this… is it enough to keep a network operating and also defray the capital cost?” In the Wall St. Journal EarthLink CEO Garry Betty, whose company is partnering with Google states "We still don't believe in the free model much."

Given what people who ought to know what they’re talking about are saying, are you and others driving this initiative looking at vendors who offer ad-driven networks with eyes wide open, or through rose-tinted classes?

Have you done the math?

I’ll use Framingham, MA as an example. With bigger cities, the numbers change but the math process is the same.

Framingham is 25 square miles and has 69,000 people living in a little over 26,000 households. A recent article estimates that it will cost $4 million to build a citywide network here. Industry folks estimate that each year it costs about 10% - 20% of buildout costs to run and upgrade the network.

Are there enough businesses in a town this size to generate $4 million and sustain $400,000 - $800,000 per year in operating costs? If there aren’t enough local businesses, is your city hip enough, rich enough and connected enough that national advertisers want to spend several hundred grand in advertising to make up the difference?

You say you can sell service subscriptions instead of ads? At $20/customer per month, the vendor makes their capital investment back in a year by signing up 16,600 citizens. If they maintain these numbers, the vendor makes a profit in year two. But what if you can only sell one account per household because families don’t want one for one for every person? Hmm, now you’re talking about 55% market penetration.

Hint: You may not want to offer the service for free initially if you want to sell boatloads of subscriptions. It’s usually much harder to sell stuff after you’ve given it away for free. Yet it doesn’t help that a recent Jupiter Research survey shows that 58% of consumers will only access public WiFi if it’s free.

What’s does the vendor’s marketing plan and financial plan tell you?

Better get proof the vendor has the skill and budget to generate enough ad sales or paid subscriptions. If the vendor shows the marketing plan to 5 veteran marketing pros, what’s the general consensus? Competitive Companies Inc. is one vendor that developed a full-on marketing plan with revenue and profit margin projections in its successful bid to provide wireless for Vine Grove, in Hardin County, Kentucky.

Have you taken a hard look at the financial impact on the vendor of fronting $4 million for your city while putting up similar amounts in other cities, while also mounting a serious marketing campaign for ads or subscriptions? Is the business sustaining itself on revenues to a venture capitalist sugar daddy? The dot bomb fiasco was the direct result of companies running out of VC funding before they could generate enough ad revenues, click throughs or whatever, to pay the bills. That, and the fact no one could be bothered with the reality that perpetual excess of expense over income equals bankruptcy.

Has everyone looked at the impact of churn?

Subscribers and advertisers both are always leaving the service and have to be replaced to maintain revenue levels. Have you looked at how much the city’s going to pay for public safety, public works or general mobile workforce to access the network? It’s possible this will offset the churn. Unless you negotiated to get that service for free.

Maybe the most important question is, has someone asked a bunch of potential advertisers if they’re willing to buy ads, for how much and how often? Have you surveyed constituents to determine what services, content or other factor will convince them to signup in the droves necessary to achieve the financial numbers needed to break even? Pay a little now to find out, or risk paying a whole lot after the network’s built.

Spend much time with colleagues in other cities?

Some cities have done the math. Have you talked to Burleson, TX? They took out a loan based on a guarantee from the service provider and assurances from Chevron that each month the city will see enough money to make the loan payment. Someone here must have done the math.

Did you talk to Addison, TX or Cupertino, CA? They both have networks supported by ad or subscription sales. Spend a little time to figure out how they’re making it work. Will their numbers scale for your city?

Bottom line

The ad-driven muni network model is one of many. It could be good for you, it could be bad. It’s not the model but the process you use to select the model that delivers results. Are enough cities – and the vendors to whom they’re giving the keys to the digital kingdom - asking the right questions? 2007 could be a good year for goat herders.

Take a look at my other post today on sponsorship of muni networks as another option for funding these initiatives.

Monday, March 20, 2006

Too Soon to Celebrate Incumbent’s Arrival at the Muni WiFi Party?

The following is a column I wrote for the March 17 FierceWireless newsletter.

With AT&T’s response to several municipal wireless RFPs, and the Cox Communications’ involvement in Arizona’s muni WiFi contract, does this mean incumbents are deciding it’s better to join ‘em than fight ‘em? The more pressing question in my mind, though, is should cities be popping the champagne corks yet?

Ok, let’s state the obvious. After fending off the scorched earth warfare tactics of the incumbents for a year and a half, it’s definitely easier for cities to advance their WiFi initiatives without that headache. Having your foes see the light, bury the hatchet and even offer to help you out truly warms the soul. And triggers my Caution reflex.

Can you teach an old dog new tricks?

The first assumption by some is that the legislative wrangling will stop as incumbents start coming to the muni WiFi party. Maybe. Maybe not. Telcos and cable executives seem genetically engineered to use heavy lobbyist pressure on all levels of government as a means to facilitate market dominance and competition reduction.

Cities do well to maintain their vigilance on legislation in Congress and statehouses which impacts municipal broadband so they don’t get blindsided. Remember House Bill 30 in Pennsylvania which restricts these projects? This was a bill that had been lying around dormant for over a year before Verizon decided to revive it in response to Philadelphia Wireless.

Another potential upside of having incumbents at the RFP table is that they can bring new ideas and insights that deliver unforeseen benefits. On the other hand, telcos are driven by a business model that champions massive infrastructure buildouts that cost so much it requires years to recoup their investment. WiFi is driven by low-cost, open standards infrastructure that delivers payback within a year.

Cities need to look under the covers of any deal proposed by incumbents to see which mindset is driving it. You don’t want to sign a deal where the business approach prevents the vendor from making money in relatively short order unless they extract some high cost from the average citizen (which is why I view “free” networks as a financial and political minefield for cities that don't do proper due diligence).

One good thing about incumbents not getting into the game until now is that an ecosystem of technology and service providers has taken root. For now there are competitive options which give cities stronger bargaining power. Unlike having one cable company or two telco options, cities can turn down offers because there are others to consider. If cities play their cards right, they can entice all RFP respondents for options that deliver better results over the long term.

There are additional positive aspects of incumbent participation in the muni WiFi mix. They understand how to run a subscriber-based business probably better than the local neighborhood ISP. The question to be answered by each city is, will their citizens get better customer care from the local ISP for whom the city’s business means a lot more? Or can cities use the local competitor to leverage better service level agreements from the conglomerate?

Play to your strong suit, all the players win

You may notice a theme developing here. Ultimately, actions taken by individual city governments will determine whether or not it’s a good thing to have incumbents become major players in initiatives they publicly demeaned a few short weeks ago. Cities that take the right steps might benefit by incumbent participation.

First and foremost, design the RFP and the contract terms from a point of strength. You own the infrastructure (i.e light poles, towers, possibly fiber networks) that makes a muni WiFi buildout possible. This is a vital asset. The cities’ citizens and its businesses are assets. Assets strengthen your position at the bargaining table. Insert contract terms that protect the city’s best interest.

Take Internet neutrality, for example. If you have top execs publicly endorsing barriers to innovative (though bandwidth intensive) applications such as VoIP and streaming video coming over what they refer to as “my lines,” do you want their companies controlling the networks serving *your citizens?* Don’t be brow beaten and don’t acquiesce on those points that ensure the best network to meet government and constituent needs.

Cities also need to educate themselves on the business motivations of the incumbents. Don’t forget the reason muni wireless initiatives started. Incumbents are highly profit motivated, so large constituent groups were underserved or not served at all because they didn’t fit into providers’ profit analysis worksheets. When using profit-minded entities to help solve what are public service and public safety objectives, seek out those whose motivations are not at cross purposes with your city.

St. Cloud, FL, which last week launched citywide free wireless service, opened the door to telcos by saying “we’re going to provide one level of service to constituents for free, but you can come in and offer value-added services for a price.” You want incumbents who can see the value in giving a city what it wants and still find a way to make a buck.

It’s all about the mission

Keep the mission of the network front and center during the vendor/provider evaluation process. Having a national telco or cable company involved with your project may appear to be a good idea because they can facilitate roaming for users traveling between cities. But does this matter if the main purpose of the network is to improve government operations? What if the goal of the network is to speed economic development of local businesses? Then the ideal vendor team is the one best capable of delivering small business services.

Incumbents bring with them a good understand of marketing (it’s PR where they can use some help). This is very important. If the people building and operating these networks don’t understand how to market the service, there won’t be enough subscriber or ad revenue to support the network and the initiative will fail or fall way short of its mission. Cities need to demand to review prospective service providers’ marketing plans, be they incumbents or local wireless ISPs.

This change of heart by the incumbents can offer great potential for municipalities. But in the ensuing cease fire, don’t re-create the circumstances that led to the great war in the first place.

Sunday, January 29, 2006

The Business Case for Silicon Valley’s Muni WiFi Network

Friday's announcement of a Silicon Valley-wide municipal broadband network is definitely an expanded vision of muni WiFi, though Morrow County, Oregon (cited in the book) represents an actual deployment of similar size. The states of Rhode Island, similar in size to the Valley, and Maine plan equally bold border-to-border WiFi infrastructure deployments.

The most common questions in coverage of the Valley announcement were “what’s the business case?” and “how are they going to do it?” Today I tackle the business case. Wednesday I’ll have a go at the “how” challenge.

The most direct ROI can result from cities and counties using the network to wireless-enable mobile government workforces, mobile physical assets and buildings. This ROI not only can justify many times over any money that governments contribute to the effort, but also can be used to drive the network’s use for social and economic development programs.

At the tip of the ROI iceberg, every government has several departments similar to Philly’s License and Inspections that can save an hour or more per worker a day by replacing paper-driven taks with wireless apps. Instead of wasting time going back and forth to the office to pick up, complete and get new paper forms, workers in the field gather, process and access data faster, accurately and more efficiently. Wireless access to resources also lets them make more and better decisions while in the field.

Taking the task audit proscribed in “Fighting the Good Fight for Municipal Wireless” uncovers a range of government operations involving mobile and office workers that can be streamlined or eliminated with wireless. Besides the productivity ROI, muni WiFi does this at faster data speeds and for significantly less money than carrier data wireless services.

The ROI of covering your assets

Every city and county owns a staggering number of mobile assets that it must track, access and manage. Everything from vehicles to office, emergency and repair equipment. It’s proven that wireless asset tracking and giving workers mobile asset management apps produce millions in ROI through theft or loss prevention plus more productive use of assets and the people who maintain them.

Cities such as Houston and Corpus Christi have also realized that wireless asset management also increases revenues. Using the technology for automated meter reading for city-run utilities and operating smart parking meters are just two areas where cities can collect more money faster and with greater efficiency.

Then we have the most glaring deficiency in emergency response operations. The lack of communication technology interoperability between departments and agencies that respond to a major crisis, both in the immediate aftermath and in the months following, causes much suffering. Muni WiFi, appropriately planned and implemented, will save lives and alleviate a lot of unnecessary misery. After Katrina hit, what technology was back online first, making a difference?

Closing the divide

Shifting to social issues such as the digital divide, which is surprisingly prevalent in parts of Silicon Valley, muni WiFi is a potent tool that produces ROI of a different sort. Cities and their stakeholders can use it to deliver programs that close the divide while making disadvantage citizens more productive members of society.

Look at what groups in Philly such as the Norris Square Civic Association, the People’s Emergency Center and Lutheran Children and Family Services did during just the pilot project phase of muni WiFi deployment. Here you start to see the potential. These groups are using technology, content and programs that leverage the network to close the divide.

The Philly School District already used their own WiFi networks to deliver nationally-recognized innovative education programs that raised the quality of education for kids of all economic strata. Now the District plans to help the city use its WiFi network to bring parents directly into these programs as partners in their children’s education.

Improving your business communities

On the economic development side, this network will create additional ROI. Review my previous post on the business impact of muni WiFi to see some of the general business impact. But wait, there’s more!

In the Valley you also have an ecosystem of startups, established technology powerhouses, venture capitalists and a plethora of supporting businesses and services. This ecosystem functions on the power of business networking, both within itself and with other parts of the country and the world.

Can you imagine what happens when you weave this networking dynamic into a high-speed, low-cost WiFi network that facilitates not only people-to-people interaction, but also machine-to-machine and machine-to-people? Think about all those creative business and technology minds down there once they start considering the possibilities.

I always laugh when I hear some incumbent telco or cable company whine about how these networks are going to stifle innovation. First off, if you have more billions than anyone except maybe Bill Gates and you can’t be innovative in the face of a $5000 WiFi transmitter, you deserve to be put out of business. But you watch the Valley. They’re going to show you some innovation with WiFi that rocks the free market world.

Thursday, January 26, 2006

Local Business Support of Muni WiFi Is No Surprise

One under-reported aspect of municipal wireless is that cities’ initiatives, if planned and managed properly, can significantly impact area businesses, and not just those hosting Internet cafes.

In a survey reported in today’s Herald Sun, nearly 70% of responding downtown businesses “are interested in some form of a municipal wireless network the town might help create.” U of North Carolina researcher Shannon Schelin who conducted the survey with the Chapel Hill Downtown Partnership said "That really did surprise me. I didn't expect a number quite that high."

We shouldn’t be surprised. Here’s what citywide affordable WiFi means to businesses.

Small businesses with 15 – 20 workers, and even larger workforces, who are mobile within a city will seriously consider mobile applications. Once they don’t have to spend $60- $80 for slow, sometimes spotty cellular data network services, but can get true high-speed wireless access, they can leverage mobile technology to compete more aggressively with larger companies. Application Service Providers (ASPs) with Web-hosted software will drive costs for mobilizing workers even lower.

Messenger services, companies that provide home and office delivery, repair and maintenance companies, professional service firms and contractors can reap the benefits of wireless dispatch, time tracking, group calendar management, etc.

Asset management will be more practical and affordable for businesses. Vehicle tracking, construction equipment security and remote monitoring can tap into this less expensive WiFi option. Firms with warehouses, manufacturing plants and shipping docks won’t have to build a complete WiFi or RFID infrastructure, just tap into the city network.

If cities deploy business portals over the network, such as Philly did with The Cloud from Pervasive Services, local retailers, museums and food establishments are some of the businesses that can see revenue increases. The Cloud lets them create content and special promos that are accessed by, or pushed out to, tourists and locals. The Cloud also can be integrated with festivals, concerts and other big-crowd events to drive customers into local businesses.

In the outlying areas, muni WiFi represents the best or only way for companies to get high speed Internet access and support a content-rich interactive e-commerce presence. For some home-based and small businesses in disadvantaged areas, the network is an affordable lifeline to potential customer who wouldn’t visit these neighborhoods. A caveat is that local government or some other entity provides the training often required so owners learn how to effectively use the Internet.

If cities and their partners properly market the network to companies, the potential for a change in how consumers buy is huge. With high speed WiFi, local merchants’ ability to use video and audio content to build or strengthen customer relationships makes financial sense. Enabling real-time interactivity and transactions with shoppers on the go boosts the bottom line.

And to address that line favored by the incumbents about no company being willing to trust a public network, consider this. Morrow County, Oregon relies on a 1000-square mile WiFi network with off-the-shelf security software to manage a myriad of monitoring and emergency response resources that keep tabs on the following.

1/3 third of the U.S.’ remaining stockpile of warfare materials, the Hanford Nuclear Reservation, a nuclear power station, a major east-west rail line, a natural gas plant and energy production and distribution facilities are all covered. The network is HIPAA-certified safe so that patient data can be wirelessly transmitted, and it’s FIPS 140-2 compliant. If Morrow County can feel secure in their use of a WiFi network, I’m sure business owners can be assured of a good night’s sleep while using their city’s network.

It’s safe to say that businesses, regardless of industry, are going to embrace municipal wireless, and be the better for it. As the article today concludes “Schelin said there weren't any clear factors, such as the age of the business or the ages of the clients the business targets, that matched up consistently with how the businesses felt about wireless. ‘People who believe wireless is important aren't just people catering to college students, which is a little different from what I expected to find.’

Wednesday, January 11, 2006

10 questions San Franciscans need to ask about that RFP

There seems to be quite the dust up in San Francisco over the RFP for a WiFi network, and from all sides of the political spectrum. The conservative view is the standard free-market arguments about government in the private sector’s business. The heart of the left and moderates argument is that the RFP doesn’t seem complete nor responsive to the needs of the people.

You can read an article and a blog that lay out some specific issues of contention.

Having looked at S.F.’s RFP, re-read Philadelphia’s RFP and knowing the many steps Philadelphia took leading up to their RFP, I believe there are a few vital things missing in the city by the Bay. If groups supporting muni WiFi in San Francisco or any city ask the following questions in the context of the process that Philly followed, many cities would get a better start to their initiatives. Don't imitate every step Philly took. Ask the questions they asked and answer them in a way that best fits your city.

1. Is there a steering committee for this initiative that is reflective of the city?

The mayor of Philadelphia selected an executive steering committee of 15 people representative of various community and business constituencies, and two from the city government. The committee brought in a consultant firm proficient in muni WiFi deployments for guidance. In S.F., the Techconnect review panel has seven members: three from the city, two from the Public Utility Commission, one community rep and the consultant firm Philadelphia retained.

2. Does the steering committee have a deeply thought out, clearly articulated vision of where they think this initiative should go?

Philadelphia’s committee worked together as a group in one session to complete an eight-page workbook in a vision-development exercise. They defined what a wireless network should and shouldn’t be, what services it should deliver to the communities, and worked through 30 values to determine “What values drive the development of this community technology program?”

3. Was there, or is there a plan for, an aggressive needs-analysis process that reflects the diverse city?

The committee conducted 20 extensive focus groups with about 15 people each, and each group represented a key constituency, including ethnic groups, neighborhoods, health care, education and business. Even the incumbents were invited to a focus group, which they declined. Participants were recruited and selected based on their recognized standing (formal or informal) as a leader within their respective constituency. All economic strata of the city were represented.

4. Is there a business plan?

The executive committee, in 90 days and before the RFP was issued, created a 72-page business plan for the wireless initiative. As with any multi-million dollar business venture, the plan included ROI projections, business model analysis, an analysis of best practices, infrastructure definition, stakeholder analysis and plan for marketing the network to the various constituencies.

5. Has there been a technology feasibility study?

For nearly a year before the RFP was issued in Philly, there was a series of “proof of concept” deployments of WiFi networks, spectrum analysis, RF testing and five pilot projects in different parts of the city that each brought together a different set of vendors’ products. S.F. cancelled their plans for a feasibility study.

10 questions San Franciscans need to ask about that RFP (continued)

6. Are there plans to put feet on the street to reach constituent groups to initiate development of community content, tools and activities that maximize the network?

After the business plan was submitted to the mayor, various community relations activities generated upport from neighborhood associations, non-profit and faith-based community service groups, chambers of commerce and tourism groups. Reps from the city built relationships among organizations, as well as between groups and the city, to put economic development and digital divide programs in place. The city hosted several neighborhood pilot launch parties to draw attention to the network and the programs.

7. Is the RFP specific enough and demanding enough to ensure that citizens’ best interests are served?

When reviewing the RFP of each city, I feel Philly’s document asks for vendors to provide a lot more detail than the S.F. RFP does to ensure certain objectives are met. For example, item 2.2.2 in the Philly RFP says “Respondents must define in their Proposals a preliminary architecture for the System as well as the services to conduct a more thorough and detailed design for the System.” Then it lists 11 points that must be addressed. Of course, if you do all of the preliminary work Philly did, you can be more demanding in an RFP.

8. Are there requirements to make sure the network infrastructure doesn’t become obsolete?

This might seem like a nit to pick, but Philadelphia requested (item 2.2.6) “a detailed plan for how and when this technology refresh process will occur during the contract term.” They also specify that upgrades be backward compatible, request that vendors’ product roadmaps reflect the intended upgrade plan and expect for the entire network infrastructure to be replaced through refreshes in the course of seven years.

S.F. appears to be more relaxed on this point, asking bidders to explain how they will determine during the course of the contract when and how upgrades are to be done. I bring this issue up because technology obsolescence can kill your network or cost a fortune to overcome if you don’t plan appropriately for it. Like other points in the S.F. RFP, it seems like they’re touching the right bases, but not carefully enough to ensure citizens don’t get screwed later.

9. Is a proof of concept required?

In Philly, the winning vendor is required (item 2.3) to build a 15-square mile proof of concept network that will operate for three months and be “sufficient to demonstrate the functionality and viability of the recommended solution.” Seems to be a prudent move since it’s better to know early if there are major issues to resolve then rather than after the other 120 square miles have been built out.

10. Does someone have the political will to put the brakes on something that might not be a great idea?

Whatever you want to say about the Philadelphia initiative, the people driving the process showed a willingness to slow down, revise, re-write or whatever was necessary to get the job done right. If you look at some of the dissent about the S.F. project, it’s about too few people making key decisions who aren’t plugged in enough with citizens. Even though the RFP calls for this network to be build for free, everything comes with a price, often paid by those citizens. Citizens are saying they want to see enough to know enough so they can determine if this RFP is a good idea. And they want it changed if it isn’t good.

Bottom line. Many cities are racing to be one of the first with muni WiFi deployments. They see what Philly is doing and they want to be part of that. When you look at these first couple of cities that are deploying, you see the political fights, the early network build outs and the first couple of failures. What you don’t see is all of the preliminary work that went into (or should have gone into) these launches.

It’s a staggering job to do this muni WiFi thing right. Yet with the stakes being what they are, don’t you owe it to your city to ask these important 10 questions, with an understanding of how these pioneering cities addressed the issues?

Tuesday, January 03, 2006

Shifting the municipal WiFi discussion in 2006

One particular piece of logic keeps floating to the top of my brain as I watch cities announce muni WiFi initiatives and telcos denounce them. It’s logic that needs to start driving the discussion in cities planning or launching their initiatives.

Aside from its representative body, city government is a business operation. In many places, a multi-million or multi-billion dollar operation. Looking at it further, cities are similar in three distinct ways to companies that have many acres of land they use for large warehouses, shipping docks, manufacturing plants or office campuses.
  1. Hundreds, if not thousands, of employees are mostly mobile in a city’s place of business – the streets within its geographical boundaries;
  2. there’s a huge number of physical assets such as emergency equipment, vehicles and building structures that cities spend a lot of money to track, retrieve and maintain; and
  3. they have, or can negotiate, access to vertical assets upon which can hang the infrastructure for an effective WiFi network.

Businesses figured out that the cost of a WiFi network pays for itself many times over through the decreased costs plus increased efficiency and productivity that comes from wireless asset maintenance and on-site employees using mobile applications. And none of these companies would even dream of spending truckloads of money for wireless data services when they own the wireless network employees on their premises are using.

Governments. Start thinking like a business! Put the discussion about providing wireless public access on the back burner for a month. Spend that time building the business case for using your vertical assets to deploy WiFi so you better manage your human and physical assets.

What you’ll likely discover is the following.

You’ll make back the money you invest within two years or sooner from the resulting cost cutting and productivity improvements. Factor in the money you won’t spend for carrier data service and ROI is quicker. Everything after that is major financial surplus. This stops all the yammering about cities not being able to make money with the network, WiFi networks are boondoggles, etc., etc.

You probably won’t have to tap into tax revenues to build the network. Build it using either capital funds, bonds or be creative and have an ISP or vendor build it. This gets you past arguments about using the taxpayers’ money. Sure, telephone poles belong to the citizens, but they’re getting more efficient government in exchange for pole space they aren’t using anyway. Hardly seems like an impeachable offense.

You can use the money you save by cutting costs and running a more efficient business operation to run social programs, spur economic development or find other ways to give citizens more value for their tax dollar. You (a.k.a. the citizens) own the infrastructure, so do with it as the citizens deem fit.

If you want to provide public access, either for the social programs or because you feel it’s a good thing to do, bring in a third party to run and manage it. No matter how much the telcos bluster about you competing unfairly against them, public/private partnerships for the greater public good are as much a staple of American government as lobbyists and billion-dollar tax subsidies. Also, since the network’s ROI is coming from improved government operations, the city has minor financial risk with the public access service.

Bottom line. Think like a business. Use WiFi to run a better government operation. Neutralize opposition to muni WiFi. Then ponder public access.