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September 24, 2007
Details of Corpus Christi’s Muni Wireless Deal
Corpus Christi is remains one of two cities to which EarthLink remains committed, the other being Philadelphia, which stands as EarthLink’s highly visible entry into muni wireless. At the Public Technology Institute conference I report on below, Oscar Martinez, assistant city manager, disclosed some details of the 10-year EarthLink contract, stating that part of the success is understanding the culture of business, which can be much different from a government operation. “You must understand the goals of your partners and how they fit into the city goals.”
Under the terms of the Corpus Christi-EarthLink partnership:
-- EarthLink paid Corpus Christi $5.3 million for the 147-square mile city network built and financed by the city’s municipal gas and water utility for $7 million.
-- EarthLink pays the city a franchise fee of 5 percent of revenues to pay for right-of-way and other costs associated with network maintenance.
-- EarthLink pays $237,000 per year for use of the city’s fiber optic backbone to backhaul wireless network traffic.
-- EarthLink provides 10 free hot spots within the city, although not at airports and convention centers.
-- EarthLink must optimize the network to provide access to 95 percent of Corpus Christi Households
-- Corpus Christi is committed to paying $450,000 this year in wireless network services from EarthLink, although if the city fails to reach that plateau in 2007, the payments will be credited toward billings next year.
-- EarthLink will provide 100 hours a month of maintenance as part of the agreement. Above that limit, maintenance is billed at $200 per hour.
-- EarthLink must provide wholesale access to its network, but is permitted to charge prevailing market rates.
The city did not antagonize the private sector, but did its best to work with it, acknowledging upfront that their vendors and suppliers—EarthLink, Tropos Networks, Northrop Grumman, National Metering Services, not to mention the dozens of hardware and software companies that the various city departments have turned to provide equipment to work with the network—are in this to make a profit. Corpus also uses Verizon Wireless’ high-speed cellular data network as a back-up.
While this is only the first year of service and time will tell if Corpus Christi sees the return on investment it hopes, the city got off on the right foot by not pretending that the economics of broadband networking were somehow vastly different because it was a municipality and not a commercial company (as opposed to, say Lafayette, La.; Provo, Utah; Ashland, Ore.; and San Francisco, to name just four).
Posted by steve.titch at September 24, 2007 07:33 AM
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