December 2, 2004

Pennsylvania Gov. Edward Rendell signed an important and sweeping deregulatory telecommunications bill into law late last night, meant to stimulate broadband deployment in the state.

But some observers claim the bill could inadvertently bump against a multi-million dollar broadband initiative already under way in Philadelphia.

In the hours before the bill was passed, city officials in Philadelphia were hoping for a veto of the legislation. A veto would give them more time to install a $10 million public Wi-Fi network in the final stages of planning there.

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The network, said Dianah Neff, chief information officer for the city of Philadelphia, is aimed at serving underprivileged neighborhoods in the inner city, as well as being an economic magnet for businesses.

Wi-Fi access could be provided as a city service to residents for around $15, providing low cost, or even free, Internet access for communities within the city. The network will use unregulated spectrum to provide the service over 135 square miles of the city.

The network had become a lightning rod of controversy as the bill made its way through the state legislature, as local wireline phone giant Verizon Communications, a parent of Verizon Wireless, fought to minimize competition from municipalities.

Early versions of the bill would have prevented communities from developing their own networks.

The bill signed by Rendell last night gives Philadelphia and other communities that are in the process of installing their own broadband networks a year -- until Jan. 1, 2006 -- to complete those plans.

"After that window closes, municipalities must offer the incumbent phone company the right of first refusal to provide the proposed service.

Then, the municipality can proceed with its proposed network only if the ILEC [incumbent local exchange carrier] waives it's right of first refusal under this act," Rendell said in a lengthy statement released last night explaining the bill.

"Verizon has already agreed to waive its right of first refusal in regard to Philadelphia's proposed Wi-Fi network guaranteeing that that particular project can proceed.

They have done so in a signed agreement with the city," he added.

Verizon was happy with the new law, which gives it and other wireline phone companies operating in the state rate incentives to roll out broadband connections statewide.

Verizon pointed to the benefits of accelerated broadband deployment in rural areas, financial assistance to schools for broadband connection and other consumer benefits that the law will foster.

Neff said the city is still hammering out some of the details of how it will offer Wi-Fi services, including who will run and maintain the system and handle customer services.

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It's also deciding on pricing for services and who will pay. 'The system has to have some free access in public spaces, like parks. It has to be cost-sustaining,' she said. 'We're looking at several models.'

An executive for one of the companies supplying networking equipment for the project said installing Wi-Fi- cell systems to cover the city's 135 square miles could be done in two to three months, but the city had budgeted a longer period for installation.

"The rule of thumb for Wi-Fi network installation is one square mile a day," said Ron Sege, president and CEO of Tropos Networks.

Source: Wireless Week

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