Municipal Broadband Wireless North American Business Models Axel Leblois, Co-Founder, W2i EUROCITIES Knowledge Society Forum - Telecities ICT for Safe Digital Cities, Bologna June 28, 2007
Municipal Broadband, North American Cities, 2006 Municipal Wireless Broadband Market Dollar Value (Millions) $400 $350 $300 $250 $200 $150 $100 $50 $0 2004 2005 2006 2007 Capital Investment in Municipal Wireless Broadband Networks Over 300 US Municipal Wireless Projects Deployed in 2006 Mix of Municipal Ownership and Public-Private Partnership Models Source: W2i/Yankee Group Research 2006
Moving from Single Application Networks to Multi-Purpose Networks Is it a multi-purpose network? Yes No 0% 20% 40% 60% 80% Municipal wireless networks are increasingly leveraged for multiple applications reducing costs and offering new services to citizens: Public Safety/Police/Fire Meter Reading/Monitoring Field Inspections Intelligent Traffic Management Neighborhood/Community Portals Educational Broadband Public Access Digital Inclusion Source: W2i/Yankee Group Digital City Survey, 2005
Public Safety: San Mateo (CA) Police Department 72 Officers in 40 Patrol Cars Tropos MetroMesh: 3 backhaul points 37 access points 3.5 sq.miles Applications: CAD, Records Mgt, Reporting Database access (LAWNet, DMV, video monitoring ) Impact: 2 hours/day/officer saved
Workforce Productivity Increases: Medford (OR) Public Works 20 Public Works Crews on shared network among other municipal agencies Motorola MotoMesh: Applications: Work order access from the field Impact: 1 hour/day/crew member Shared infrastructure with public safety Future Impact: 20+ additional applications including: Records access Location based services GIS
Machine to machine communications Corpus Christi (TX) Water & Gas Utility System $1.90 Calculated Cost per Read - Personnel Costs $1.70 $1.50 $1.30 $1.10 Dollars $0.90 $0.70 $0.50 $0.30 $0.10 $(0.10) 0 2 4 6 8 10 12 14 16 18 20 Year Current Drive By Fixed Network
Field Workforce Automation Scenario City population Local Government workforce Field workforce Productivity improvement Dollar savings 3% 30% 20% $30-50,000/man/year 100,000 3,000 900 180 man/years $ 5.4 to 9 million/year *Assuming 20% public subscriber uptake
How are you financing the network build? 50% 45% 44% 40% 38% 35% 30% 25% 24% 20% 15% 15% 14% 10% 8% 5% 0% Local government entity budget/ tax money Bond underwritings Grants Dual funding from private partner and community Privately funded by private partner Operational Cost Savings Patterns are starting to emerge attesting to a negotiation between local government and the private sector to determine the right mix of cooperation Source: W2i Yankee Group Houston Survey 2006
Municipal Broadband Business Models Business Model Public/Private Partnership Philadelphia Minneapolis Private Ownership Rio Rancho, New Mexico Grand Haven, Michigan Municipal Own and Operate Chaska, Minnesota Allegheny County, Maryland Own and Outsource Corpus Christi, Texas Miami Beach, Florida Benefits Lower risk for community Expert knowledge in network design and management Eliminates all risk, but removes flexibility and government having any role in network Complete financial burden Lack of expertise and knowledge in network build City owns network and outsources to integrator or service provider Focus on government applications
Municipal Wireless: Key Observations Measurable benefits in government operational efficiencies abound Broadband wireless infrastructure deployment is first and foremost driven by the need for Better City Management Cheap Public Access as a primary driver for deployment of wireless infrastructure is highly speculative and should be viewed as a secondary objective, or side benefit
A Resource for Municipalities Involved with Broadband Wireless Networks www.w2i.com
www.w2i.com axel_leblois@w2i.org Thank You Wireless Internet Institute 225 Franklin Street, Boston, MA 02110 Tel: (617) 439 5400 Fax: (404) 252 0628
Existing Technology in Communities Hybrid Technology 3G Cellular WiMAX Mobile Mesh Wireless M esh WiFi 0% 10% 20% 30% 40% 50% Source: W2i/Yankee Group Digital City Survey, 2005
The Digital Divide Is Real 2004 US Broadband Penetration By Income Broadband Penetration 60% 50% 40% 30% 5x Difference in Broadband Availability 20% 10% 0 >$100k $75-$100k Average $10-$30k <$10k S ource: Pew R esearch, 2005
Knysna, South Africa Geography: Sub-urban Operating Area: 1,059 km². Population Served: 51,000 Cost: US$ 370,000 Local Champion: Knysna municipality Partners Include: Several local government agencies UniNet Communications Driving Factor: Cost effectively connect all 46 municipal branches with data connectivity and voice Secondary Applications: To improve local government service delivery To further differentiate Knysna as a destination of choice for businesses, tourists and citizens Provide low cost connectivity and voice solutions for citizens
Digital Cities Convention:Major Applications US Local Governm ent Workforce (000) 10000 9000 8000 7000 6000 5000 4000 3000 2000 1000 0 17,7 % growth 6.3% growth 2002 Mobile Workforce 2012 Sedentary Workforce Year Priority driven by compelling ROI based business case: Priority #1: service local government mobile workers Priority #2: provide infrastructure necessary for job-saving and jobcreating investments Priority #3: digital inclusion Priority #4: deliver lifestyle changing services to citizens Priority 1&2 are the short/medium term, lower risk compelling economic business case that higher risk priority 3&4 can leverage to achieve long term political goals