EarthLink Inc. and Google Inc. have finalized a four-year deal to provide free wireless Internet service throughout San Francisco after seven months of sometimes-tense negotiations that stalled the city's effort to ensure all its residents, visitors and businesses have easy access to the Web.
San Francisco Mayor Gavin Newsom signed off on the contract Friday, but the details still require the approval of the city's Board of Supervisors and Public Utilities Commission.
A five-member panel picked EarthLink and Google Inc. to build the project in April, with the goal of having the system running by the end of 2006. It now appears that the wireless, or Wi-Fi, service won't be available throughout San Francisco until early 2008, although limited access may be available as early as April.
Google launched a free Wi-Fi service in August in its home town of Mountain View, making the 11.5-square-mile city of 72,000 people the largest U.S. community with free Wi-Fi throughout its borders.
Those bragging rights presumably will belong to San Francisco, with a population of roughly 800,000, once its Wi-Fi service is finally up and running.
More than 250 communities nationwide either are preparing or have deployed Wi-Fi services, but most of those include access fees. The list of big cities pursuing major Wi-Fi projects include Philadelphia, Minneapolis and Chicago.
The estimated $14 to $17 million cost of building and maintaining the Wi-Fi system will be shouldered by EarthLink. The Atlanta-based company will try to recoup its investment by charging $21.95 per month to surf the Web at speeds three to four times faster than the free service, which will still be quicker than using a dial-up modem.
Online search leader Google will sell ads to help subsidize the free service. About 3,200 low-income residents will be able to subscribe to the faster Wi-Fi service for $12.95 per month.
San Francisco will get 5 percent of the subscription revenue — a cut estimated to be worth about $300,000 annually. That figures indicates EarthLink expects the Wi-Fi service to generate about $6 million in annual sales.
EarthLink also will pay the city $600,000 for right-of-way access and $40,000 annually to place Wi-Fi equipment on street poles.
The contract contains options that could extend the deal's initial four-year duration by another 12 years.
Newsom began his push for a free Wi-Fi system in 2004, touting his vision as a way to keep San Francisco on the cutting edge of technology while making it more feasible for poor households to get online. San Francisco estimates about 30 percent of its residents don't have Internet access at home.
"This agreement to bring free universal wireless internet access to San Francisco is a critical step in bridging the digital divide that separates too many communities from the enormous benefits of technology," Newsom said.
San Francisco's original timetable for launching the service was delayed as city leaders with EarthLink and Google over privacy concerns, the contract's length and financial arrangements.
EarthLink and Google addressed the privacy concerns by giving users the choice to block the service from tracking their precise location. Google believes the ability to pinpoint a user's location might help the company deliver more useful ads about nearby merchants.
At one point in the talks, Google publicly vented its exasperation with San Francisco's bureaucracy, saying it had far less difficulty gaining approval to build a free Wi-Fi service in Mountain View.
Fonte:
http://www.sfgate.com/cgi-bin/article.cgi?f=/n/a/2007/01/05/financial/f155710S62.DTL
