Wireless internet provider The Cloud has only signed up an average of 20 users for each of its WiFi hotspots.
And with municipal networks across the world struggling to break even, questions about the commercial viability of such schemes remain unanswered.
In March London was crowned WiFi capital of the world, with its 11,000-plus sessions during a six-month period more than doubled the rate in Singapore, the next most popular city.
But The Cloud’s Square Mile service attracted only 6,000 of a potential 350,000 users when it launched in April. And so far the company has only 200,000 people using its 10,000 hotspots across the country.
WiFi is one of several network technologies that will link together to provide ubiquitous internet access, said The Cloud chief technology officer Niall Murphy.
‘It is not a panacea and it cannot solve all problems in all places,’ he said.
‘But if you want broadband access in the middle of a very dense urban environment, WiFi has tremendous strength and a very high throughput.’
Municipal WiFi’s problems are not unique to the UK. EarthLink, for example, which runs networks in Philadelphia and New Orleans, announced this month that it is laying off 900 staff and possibly closing its municipal WiFi division.
Part of the problem is that consumers may not be interested in the current proposition, according to Stephen Hearnden, director of telecommunications for trade association Intellect.
‘People are using the internet a lot more than they used to, but most prefer to do so at home,’ said Hearnden.
‘And now that people are used to the concept of access being free, the idea of paying for it in a hotel, for example is simply off-putting,’ he said.
WiFi providers are also competing with alternative technologies such as WiMax which is newer and works over longer distances and the expanding 3G mobile phone network.
For business users with more bandwidth-hungry requirements, WiFi and 3G are unlikely to prove a serious option because they are ‘contended’ services which can be slow when there are lots of simultaneous users.
But other commercial wireless technologies may still make sense.
Wireless provider Metronet, which uses a point-to-point IP network, made a profit for the first time last quarter thanks to 60 corporate customers across the city.
Point-to-point is good for businesses because it is faster and more reliable, said Metronet chief executive Elliott Mueller.
‘The nature of the radio involved means you can control bandwidth, so we can
easily start off a customer with a 1Mbit/s service and upgrade them later to
10Mbit/s,’ he said.
