PHILADELPHIA -- The city yesterday disclosed details of its deal with EarthLink for the construction of a high-speed wireless network that will span the city, including provisions for EarthLink to pay for computers, training, and subsidize Internet access for low-income households.
Chicago and San Francisco have disclosed similar plans for WiFi networks, but Philadelphia's plan has come the furthest, and the concessions EarthLink is making to Philadelphia are bound to be watched by other cities.
Mayor John Street said the city and Wireless Philadelphia -- a nonprofit charged with overseeing the WiFi initiative -- have signed agreements with EarthLink, the Atlanta-based Internet service provider. Street also urged the city council to approve the contracts, which would span 10 years.
The 135-square-mile network is expected to be completed next spring. The contracts call for EarthLink to rent space on 4,000 city light posts for its equipment, and pay the city $74 annually per light post -- nearly $300,000 a year. EarthLink also agreed to give Wireless Philadelphia 5 percent of its access revenue.
The money will fund 10,000 computers and training for children and low-income households. EarthLink will also provide Internet access for up to 25,000 low-income households at $9.95 a month, and give the city government free or discounted access.
Moreover, EarthLink will operate 22 free WiFi hot spots.
Wireless Philadelphia said it would cost EarthLink between $20 million and $22 million to build and operate the network. The WiFi speed will be at least 1 Megabit per second, slower than some DSL or cable connections but much faster than dial-up.
EarthLink will charge a wholesale rate of under $12 a month to other Internet service providers, which in turn will sell their services to the public. That rate is up from the original estimate of $9. The goal is still to keep retail prices under $20 a month.
EarthLink and its partner Internet service providers could face stiff competition from phone companies, which have been heavily discounting their high-speed Internet packages. Verizon Communications, which serves Philadelphia, offers DSL broadband for $14.95 a month.
Donald Berryman, president of EarthLink's municipal networks division, expects the network to have 50,000 to 80,000 subscribers by the end of its second year.