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Telcos could block free wireless in Philly

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Major telcos are all for free, citywide wireless networks in US cities just so long as the networks aren't free or citywide.

That's the word in Philadelphia where Verizon appears to be on the verge of quashing one of the most ambitious free wireless network plans to date. Telco lobbyists are pushing hard to restrict the rollout of free city-provided wireless networks in Philadelphia and elsewhere, arguing that the service providers are potentially losing out on large revenue streams. The cities, however, see the networks as convenient, helpful to bridging the digital divide and as a way to attract tourists.

In September, Philadelphia unveiled its plan to provide all of the city's 1.6m residents with wireless access by late 2005 or early 2006. The city-provided network would complement existing pay-for-use services at the likes of coffee shops and hotels. All told, Philadelphia said the network would cost $10m to set up and then $1.5m per year for maintenance.

"We believe that for a city to succeed in the future, it must be a digital city," Philly's CIO told us at the time.

Philadelphia expected to cover some of the service's costs by charging tourists for access and by sharing revenue with businesses.

The plan, however, may never reach fruition.

"In the past year, companies including Qwest Communications International Inc., Sprint, BellSouth, and Verizon Communications have pressed for legislation in Pennsylvania, Florida, Utah, and Louisiana that would extract concessions from public-sector telecommunications ventures," the AP reports. "A chief complaint: a city can draw on taxpayer dollars, while a private company has to pay interest on borrowed capital. Also, the telecoms complain, public-sector projects are subject to far less regulation."

A bill currently in front of the Pennsylvania governor would basically block Philadelphia's proposal.

The bill would not take effect until Jan. 1, 2006, which means Philadelphia could roll out its service first. This, however, would require very smooth operations. The telco lobbyists are arguing that service providers should at least be able to bid on similar deals before cities take it upon themselves to start up a service.

The governor has until Nov. 30 to make up his mind on the bill. ®

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