Another Muni-WiFi Deal Ends as AT&T, St. Louis Part Ways

As first reported by reporter Tim Logan of the St. Louis Post-Dispatch, AT&T has called off its ambitious plans to roll out free municipal WiFi service over a 62-square-mile area covering St. Louis County. While AT&T had been wrestling with the problem of how to build a business model around this lucrative service, what may have ended up scuttling the deal was an unforeseen technical difficulty.

"City hereby authorizes Company to place System Equipment on City Property," reads part of the agreement reached between the City of St. Louis and AT&T last February, "all as further provided in the Pole Attachment Standards Document. Company shall use and access City Property in such manner as not to interfere with other services provided from or on such City Property."

The big plan was for AT&T to be granted access to the city's streetlamps and stoplight poles, from which it would construct a network of WiFi transmitters. In exchange, the carrier would agree to provide citizens with municipal WiFi Internet access, under a service plan that was expected to grant free access for up to 20 hours per month, at speeds at or approaching 1 Mbps. For AT&T to have made any money on this, the city agreed to purchase hundreds of accounts for use by its police, fire, and transportation officials, under a five-year contract that would have brought in $400,000 per year for five years, according to Logan's reports.

While AT&T officials in previous months had been telling Logan the company's hopes at that point were just to break even, it was believed to be looking into ways to subsidize the free service with perpetual ads running along the top of users' browsers.

But that's not what did the deal in. What lawmakers and AT&T officials making the original deal forgot to take into account, Logan learned, was the fact that the streetlights - which, as visitors to St. Louis and other metropolitan areas may have noted, only light the streets at night - don't actually receive power during the daytime. Rewiring all the city's light poles to receive perpetual power while still turning off the lights in the daytime, would have cost an estimated $28 million.

One alternative which was reportedly considered was for AT&T to make use of, ironically, telephone poles. But with the use of wooden poles diminishing as more cables are buried underground, and with existing poles finding themselves in inconvenient locations such as alleyways from which WiFi signals wouldn't carry, that alternative was apparently deemed unworkable.

As cities such as St. Louis, Houston, Chicago, and San Francisco are learning, there isn't much of their own existing infrastructure left that's suitable for leveraging a new public wireless communications infrastructure. Without much municipal backing to lead the way - more to the point, with cities remaining reluctant to sign on even as "anchor tenants" for important public projects - carriers such as AT&T find themselves left to their own devices to figure out not only how to build the 21st century public infrastructure, but how to profit from it as well.