Sunday, January 06, 2008

Bottoms Up

Readers of this blog know that I often comment on developments and trends in other industries. I do this because I believe those changes can give us insight into our future.

I'd like to talk for a few minutes about an interesting initiative out in San Francisco.

Back in 2004, SF Mayor Gavin Newsom proposed the creation of a wireless network to provide Internet access to his city. A RFP (Request for Proposal) was issued the following year and, in April 2006, the city announced that a proposal submitted jointly by Google and Earthlink had won the bid.

Sixteen months later, on August 29, 2007, Earthlink announced it was backing out of the contract. The next day, the San Francisco Chronicle reported the following: "The contract, which was three years in the making, had run into snags with the Board of Supervisors, but ultimately it was undone when Atlanta-based EarthLink announced Tuesday that it no longer believed providing citywide Wi-Fi was economically viable for the company."

The day before it backed out, Earthlink announced layoffs of 900 jobs--half its workforce--and its spokesman said the company "was not willing to work in the business model where EarthLink fronts all the money to build, own and operate the network."

Yesterday, an Associated Press story reported that "[a] Silicon Valley startup is promising to blanket San Francisco with free wireless Internet service, reviving a crusade that crumbled last year after two much larger companies, EarthLink Inc. and Google Inc., scrapped their plans to build a high-speed network for Web surfing."

The new initiative is being led by a network equipment manufacturer named Meraki Networks Inc. Google is one of the company's financial backers, which suggests that Google was hedging its bet on Earthlink.

AP's business writer Michael Liedtke says Meraki "hopes to complete the ambitious project within the next year by persuading thousands of San Francisco residents to set up free radio repeaters on their rooftops and in their homes. The 21-month-old company is to announce its plans Friday."

Earthlink's plan was to install transmitters on public property, and its efforts were stymied by bureaucracy and local politics.

Meraki plans to do an end run around these political impediments by going directly to consumers.

PC World says:

The startup . . . believes it will succeed where EarthLink and Google did not: Building Wi-Fi access throughout San Francisco at no cost to the city. It expects to finish by year's end . . .

Meraki is footing the whole bill on this project so it can learn how to roll out such networks for profit elsewhere. The good news, if the plan works, is that it could do so for less than US$5 million, lower than the cost many other municipal wireless projects have run into . . .

Meraki will build the backbone of its network with solar-powered rooftop access points and fill out its coverage with smaller repeaters to sit in windows or on balconies. Both will be designed and built by Meraki and provided free to residents and businesses that agree to house the gear on their property in return for better coverage. All the nodes will be meshed, so Meraki won't have to get wired broadband links everywhere its access points go.

The AP story says:

Since starting its tests about six months ago, Meraki has given away about 500 repeaters — enough to provide high-speed wireless, or Wi-Fi, access to about 40,000 people in San Francisco neighborhoods covering a roughly 2-square-mile area.

After raising an additional $20 million from venture capitalists, Meraki decided it had enough money to set up free Wi-Fi in San Francisco's remaining 47 square miles.

Meraki probably will have to give away 10,000 to 15,000 repeaters . . .

I was intrigued by Meraki's creativity in problem-solving and its grassroots approach to building a network. Instead of a "top down" solution, they opted for a "bottom up" response.

I've talked before about the centralization of publishing over the last forty years. Beginning in the '70s, publishing houses were swallowed by large media companies until today, there are seven media conglomerates that control most of the business. I'm not going to take the time here to go over that history. If you're interested, you can read my post for 3/7/07 here.

With the advent of digital technology and print-on-demand capability, I've predicted that the present centralized system will begin to fragment again. If you want to read more about that, visit my post for 6/25/07 here.

I believe that publishing is going to reinvent itself using a bottoms up approach.

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