Minneapolis OK's citywide Wi-Fi network
Qwest disappointed with decision, touts its own Net product.
By Jeff Smith, Rocky Mountain News
Wednesday, September 6, 2006
The city of Minneapolis has become the second large market in Qwest's territory to decide to build a high-speed municipal wireless network.
The Minneapolis City Council on Friday approved a deal for U.S. Internet to build and operate the $20 million citywide network and charge residents $20 a month for Internet service.
Earlier this year, the city of Portland, Ore., approved a similar network, being built by California-based MetroFi Inc.
Qwest has opposed municipal broadband networks, which mean additional competition. The Denver telco already is experiencing stiff competition from cable companies such as Comcast Corp. in its 14-state local phone region.
"Qwest believes it's wrong to use taxpayer money to subsidize a private company to compete with existing businesses," John Stanoch, Qwest president for Minnesota, said in a statement. "We're disappointed with the council's action last week. Having said that . . . we'll make sure we do the things necessary to win in a competitive marketplace."
Stanoch added that Qwest believes it has a superior high-speed Internet product in terms of price, speed, reliability and security. Comcast made a similar statement to local newspapers.
The Minneapolis network, which will cover all 54 square miles of the city, is expected to start construction this fall and launch operations in about a year. The city reportedly will pay $2.2 million up front and $1.25 million a year for municipal services including public safety.
The $20-a-month residential service will be at a speed of 1 megabit a second - or about 18 times faster than standard dial-up service.
Qwest by comparison offers 1.5- megabits-a-second Internet service for $26.99 a month when packaged with a home phone service, or $31.99 a month a la carte. A higher speed is available for an additional $5 a month.
Minneapolis has had dozens of meetings to discuss a possible municipal network since August 2004. A 77-page business case for the network didn't criticize Qwest or Comcast directly but did say the network was needed to ensure that low-income communities aren't excluded from the digital economy.
"This network will offer ubiquitous broadband access citywide, thereby eliminating 'dead zones' or areas of limited penetration by current broadband market providers," the document stated.
Denver last year asked potential vendors to submit plans for a wireless communications network. City officials said then it primarily wanted to improve city services such as safety.
Darryn Zuehlke, the city's telecommunications director, said Tuesday any network would comply with Senate Bill 152, which requires an election before raising taxes or issuing bonds for a communications project.