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Watching for Changes in the Prevailing Winds

From my perspective inside a city government the past three months, I'm noting winds of change starting to blow through the muncipal wireless industry. But is this just a new perspective for me - my own personal epiphany? Or is this really a potentially signficant change we are witnessing?

The change I'm talking about is the entry by large telecom firms into this budding industry. It has been an exciting time for the past three years, as the pioneers bravely forged into the woods, creating a new path to connectivity and municipal possibilities. So what does it mean now when BT, AT&T, Verizon, and Sprint begin to get engaged in municpal wireless? Will they compete by the same rules, or will the name of the game change altogether?

Long written off by the pioneers of municipal wireless as opponents to change, large telecoms were even villified by some as evil incarnate, by others as sluggish dinosaurs on their way to extinction. The view of these struggling entrepreneurs and consumer advocates was understandable, given the battles they fought in state legislatures in 2005 over the rights of municipalities to determine their own connectivity destinies. In that worldview, telecoms were aging behemoths incapable of change and resistant to ceding of any power to municipalities. But we should all beware of holding onto worldviews challenged by change in a dynamic environment.

The winds started to shift with the passage of a statewide franchise bill in Texas in the summer of 2005 (and the failure of muni wireless opponents to secure a municipal ban). In Congress last fall, we detected a shift in perspective at telecoms, away from such municipal prohibitions. And that change in perspective was certainly helped along in 2005 when the Public Private Partnership emerged as the dominant business model for these new municipal deployments. No longer was the focus on whether or not municipalities should be able to own and operate their own networks.

Now it is apparent that these large telecom companies have taken a new look at the municpal wireless industry, or that their plans are unfolding so that this new perspective is becoming apparent. Either it's an evolving perspective or they've been looking at this arena all along as having promise, but have just been biding their time for the right moment to enter the fray. I would argue for the latter, which is borne out when we look at this timeline of events regarding AT&T and municpal wireless, over just the past five months.

May 10 ATT / IBM not selected by Waukeshaw, WI - rationale for not picking ATT

August 29 comment and analysis on ATT win in Springfield, IL

October 6 update on Sacramento, CA reissue of RFP, with ATT / MetroFi as one of four respondents

October 14 comment and analysis on ATT / MetroFi win in Riverside, CA - estimated completion in 2008

October 15 ATT / MetroFi make Sacramento ATT's second municipal wireless win - its official, they're players in muni wireless

The coming months will no doubt see more activity by AT&T, and I'm thinking other large telecom companies as well. It is inevitable that the entry of these large companies into this still relatively new industry will change the landscape. The challenge for all of us who have put so much into this industry to date will be to adapt and ensure that such change results in improvements for the cities and citizens of the US. For cities, this should be seen as yet one more sign that they should move these projects up on their agendas and begin to devote serious attention to their readiness to take advantage of any new opportunities the winds may blow up on their doorsteps..

Municipal Wireless is for real, and woe to the cities caught napping and unaware, lest these winds of change blow right by them and leave them in the dust.

Posted on October 17, 2006 at 03:00 PM

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