EU wins approval to waste €120m on pitiful public Wi-Fi

€120m for the bin...

Opinion A group of European governing institutions has approved a programme to invest €120m (£105m, $134.7m) in public Wi-Fi hotspots in over 6,000 municipalities in all European Union member states by 2020.

The WiFi4EU initiative, first proposed last September, is a stern disregard for recent history – which has seen the closure of almost every muni Wi-Fi project ever launched.

To demonstrate how the project is poised to be a colossal waste of money, iPass data counts that Europe currently has 87 million community Wi-Fi hotspots, otherwise called Homespots, in 12,721 municipalities, with retail being the most common area with 380,000 Wi-Fi hotspots across Europe. This gives an average of 6,840 homespots per municipality in Europe today.

The EU is currently made up of 28 member states (Brexit pending), meaning that the WiFi4EU project will award Wi-Fi funding to an average of 250 municipalities per country – signing over €20,000 ($22,450) to each municipality.

The EU says this money will be enough for a single AP over three years, which is not quite the 6,840 homespots per municipality Europe has today – which speaks volumes about how the latest initiative is just a drop in the ocean, and how Homespots are the right way to go.

While the project certainly means well, it is a shame to watch the EU miss the mark and throw money at a public service which will not offer anywhere near an excellent QoS, for the few who will bother to use it.

The major difference between a homespot and a hotspot is that hotspots are planned and spaced for maximum effectiveness and tend to be outdoors. The widespread growth of homespots is making it more difficult for hotspot owners to profit from Wi-Fi, with Skype as one example as the Microsoft subsidiary recently announced it is closing down its Wi-Fi hotspot service.

Europe is undergoing a radical increase in the homespot market – iPass reports a 424 per cent growth in commercial and community hotspots since 2013.

The critical aspect of any Wi-Fi hotspot is speed, something the European bodies have conveniently ignored, safe in the knowledge that the WiFi4EU initiative will fail to provide the speeds required for a frustration-free experience. Speeds might even be as low as 250 Kbps, which was the limit put on public Wi-Fi in Barcelona, due to concerns that the project was seen as competing with local operators.

The European Commission's Digital Single Market VP, Andrus Ansip, admits that speeds are not up to scratch, stating this week that "WiFi4EU is a welcome first step, but much more needs to be done to achieve high-speed connectivity across the whole EU territory."

To this end, the Commission has separate proposals to invest €500bn ($561bn) in network infrastructure over the next ten years as part of the plans for a Digital Single Market, but has conceded the real figure is more likely to be under €350 billion ($393bn).

It outlines that public services such as hospitals should have access to 1 Gbps connectivity, European households should have access to at least 100 Mbps connectivity, and urban areas should have uninterrupted 5G connectivity. WiFi4EU is not the way to achieve these goals.

Operators repeatedly attempt to block municipality Wi-Fi efforts such as this, with Spain being a key problem area. The deputy head of Unit broadband at the European Commission, Herve Dupuy, said at the London-based Wi-Fi Now conference in October last year that the Commission may be able to win over Spanish regulators in order to get permission to offer city-wide Wi-Fi – which we think is an unlikely outcome. You would have EU funding competing with Telefonica – it’s not right.

The balance of power is shifting against the traditional MNOs to Wi-Fi-first MVNOs led by cable and other operators with offload via hotspots and homespots, alongside MVNO agreements.

MVNOs can offload data usage to Wi-Fi networks, meaning that MVNO deals cost very little. There is no clearer example of this than Comcast’s MVNO partnership deal with Verizon, in trial now and launching imminently, already boasting 16 million Wi-Fi hotspots.

WiFi4EU is targeted primarily at public parks and squares, hospitals and libraries, and the idea is that municipalities apply for funding for a local AP but are assigned vouchers to prevent the misuse of funding, carried out on a first come first served basis. The EU says its vouchers and other tools will cover up to 100 per cent of the expenditure, and the local council or body would take on responsibility for connection maintenance for a minimum of three years.

Commission President Jean Claude Juncker said WiFi4EU aims to provide “every European village and every city with free wireless internet access around the main centres of public life by 2020.”

It is difficult to put an exact figure on the total number of villages and cities in Europe, but the Council of European Municipalities and Regions has 150,000 authority members – at €20,000 per municipality that would work out at a hefty €3bn ($3.36bn) investment to sweep WiFi4EU across Europe.

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