Another blow for municipal Wi-Fi

Wi-Fi network operator MetroFi is said to have begun looking for a buyer for its nine municipal wireless networks or, failing that, to pull the plug on them.

MetroFi’s decision to abandon the market is being reported on the Web, by Glenn Fleishman’s Wi-Fi Net News and MuniWireless, two Web sites that cover this market. Fleishman cited an email although there’s no formal announcement on the company’s Website. The company did not respond to an email request for confirmation sent to a general information email address.

Fleishman is citing an email he received from MetroFi CEO and President Chuck Haas about the company’s plans. The email was also the source of the news that MetroFi has offered the Portland network to the city for just under $900,000.

There’s no formal announcement on the company’s Website The company did not respond to an email request for confirmation.

MetroFi raised about $15 million in funding from August Capital, Seven Rosen Funds, and Western Technology, and deployed several Wi-Fi mesh network in California’s Bay Area, including Cupertino, San Jose, and Sunnyvale, as well as Aurora, Illinois and Portland, Oregon. Deployment halted in Portland last year, when MetroFi sought but failed to get additional revenue commitments from the City.

The news comes hard on the heels of Earthlink’s announcement that it will close down the Philadelphia Wi-Fi network June 12, after talks with Wireless Philadelphia, the non-profit that oversees it, broke down without finding a way to transfer ownership of the network. Wireless Philadelphia CEO Greg Goldman told reporters he’s still working on finding new owners. “We’re still working to identify a partner or partners who will be willing to step in behind Earthlink,” he said. “I don’t think all those options have been exhausted.”

Metro Philadelphia reported last week that the network, which was supposed to cost the city nothing, has in fact been supported with $2.6 million in taxpayer funds: $1.26 million in consulting fees, and a $1.4 million loan from the city to help Wireless Philadelphia get started, a loan forgiven last year by then-mayor John Street at the non-profit’s request, according to the report.

The municipal wireless market is retrenching, in two ways. One is with more specialized and narrowly focused projects such as video surveillance and public safety wireless networks now being favored, or the city as supplier of excess fiber capacity that can fund wireless edge networks for Internet access. The second is a re-assessment of community-based, grass roots networks that are exploiting wireless mesh as a way of sharing wired broadband connections.

Despite the high-profile setbacks, John S. and James L. Knight Foundation has pledged $25 million over five years, partly to fund municipal wireless projects, and partly act as a clearinghouse for information and best practices, working with another networking non-profit, OneCommunity.

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