US cities’ Wi-Fi dreams fading fast

WASHINGTON, Sept 23, 2007 (AFP) - Ambitious plans for big Wi-Fi networks to provide free or low-cost wireless Internet access are being abandoned or scaled back by US cities as the economics of the deals turn out to be more challenging than expected. San Francisco and Chicago in recent weeks abruptly halted plans to set up municipal Wi-Fi networks while Internet giant Earthlink, a partner for a number of cities, has begun a reorganization that will limit new projects.

Wi-Fi, one of the most popular standards for wireless Internet access, had been seen as a means of connecting more people at a relatively low cost, and city leaders across the United States had been rushing to use the technology for "digital inclusion" programs for low-income residents.

But cities and companies are finding the economics more difficult, with many expensive access points needed and relatively small numbers of subscribers signing on.

"I think it's a troubled market," said Daryl Schoolar, senior analyst at the research firm In-Stat.

"Some thought a lot of people would rush out with laptops and would use it.

But Wi-Fi doesn't really penetrate buildings well. And people use Wi-fi mainly in hotels, airports and cafes."

Although some privately operated