Manitoba service provider takes risky route with ISPs

Most companies shy away from business partners that lack solid business plans, knowledge of the industry and common sense. But Manitoba Hydro embraces such corporate dunderheads. And the results aren't as bad as you might expect.In a candid presentation at the Canadian Utility Telecom Conference in Toronto last month, Al Pinder, a project manager at the provincial crown corporation, outlined the good, bad and ugly aspects of starting a commercial communication services arm.Let's start with the ugly: as Pinder said, many of his company's customers aren't exactly on the telecom ball. Speaking particularly of wireless Internet service providers (WISPs) - among the most prolific of the utility firm's clients - many come to Manitoba Hydro with little sense of what they want, how to get it, or how to support their own purchases."They don't have the slightest clue about technologies," Pinder said, providing examples:A company wanted to erect a communication tower that wouldn't meet proper safety standards.One WISP wanted to load its tower with more dishes than recommended.Another customer sent its PC technician to the network co-location centre to make some router changes. He made a mess of his own firm's links.Some come to Manitoba Hydro with unrealistic business plans that predict reaching cash flow-positive status in just three years.The situation calls for deft partner direction, Pinder said, noting that Manitoba Hydro has had to make technical and business suggestions to more than one WISP. Nonetheless, some of them are thriving. High Speed Crow, a WISP operating north of Selkirk, has 600 customers. The Hutterian Broadband Network Inc. brings video conferencing into classrooms in Hutterite communities, so children in one district get science lessons from a teacher in another district.The WISPs help bring broadband connectivity to areas otherwise beyond high-speed Internet infrastructure, Pinder said. But the service providers can get ahead of themselves, signing up more customers than they can support, and "they just grow themselves to death."Pinder said Manitoba Hydro's experience offers an important lesson for other organizations starting commercial communication services: build scalable networks, because customers will always want more. "Bandwidth requirements are not going down," he added.What Sucks about Wi-FiPinder wasn't the only candid speaker at the conference. Dave Dobbin, the outspoken head of Toronto Hydro Telecom Inc. (THT), also made a presentation titled "What Sucks about Wi-Fi."THT turned on the first phase of its citywide public Wi-Fi network late last year, but not without controversy. When the launch date was delayed, THT came under fire from critics, some of whom wondered if the company's plan to blanket downtown Toronto with a ubiquitous Wi-Fi network was destined to fail.The firm managed to get the first phase up and running, covering the financial district. But getting it done wasn't fun, according to Dobbin who said the company faced significant hurdles. For instance, it was almost impossible to provide a strong signal at the corner of Bay Street and King Street - the heart of the financial district. Failure here would count as a public relations nightmare. The problem, noted Dobbin, was caused by 95 other Wi-Fi hotspots operating at the corner. "Our engineers called it RF (radio frequency) Hell," he said.THT installed numerous, powerful access points to overcome the interference. But the company learned a lesson: "If I had to do it again, I wouldn't promise ubiquitous coverage," Dobbin said. "It's virtually impossible to provide."The vast number of stakeholders with an interest in the system also created some problems. Health officials, worried about the dangers of RF radiation, had to be convinced that the Wi-Fi network was no worse than cellular networks. The police were worried that society's underbelly would use the network's free trial period to download child pornography. In response, THT developed an authentication system that ties the user to a cellphone number, so if the user does something illegal online, the authorities have an identifier.Business improvement associations wanted a say as well. Other wireless providers requested meetings. And at city hall, some established communication carriers were lobbying councilors to put a stop to the whole thing. "We had no idea how intense the political interference would be," Dobbin said."In the end, everything worked out," he said. The network is up and running in Toronto's financial core, sometimes providing download speeds as high as 7 Mbps.Obstacles remain, however. One building - the gold Royal Bank Tower - utterly blocks Wi-Fi signals, so people inside can't connect. And the viability of the business model appears to be still up in the air. Whereas THT expected to make most of its money from stationary users paying a monthly fee, the company has found that most of the users on the network in the current free trial are nomadic, sporadic users. When THT starts charging for access in April, it may be the roamers that fill the firm's wallet.It's been said that every city's experience with building Wi-Fi is unique. Toronto's case is odd in at least one respect: Toronto Hydro owns the streetlights, where access points are erected. As a result, THT didn't have to undertake public consultations to win access to the poles. In many other cities, the utility company doesn't own the streetlights, so a public process would be in the cards.Still, THT's project offers some universal nuggets of wisdom:Keep the door open for stakeholders. You never know who might be affected.Authenticate users to keep the police happy.Be prepared for engineering cost overruns.Have a flexible timetable. This will take longer than you expect.Keep the end user's experience in mind: don't block applications.

Manitoba service provider takes risky route with ISPs

News | 04/16/2007 12:51 pm EDT

Unlock all the Canadian telecom, broadcasting and digital media news you need.

FREE TRIAL

SUBSCRIBE

Reuse & Permissions

Inside The Wire Report

Information

Hill Times Publishing

Get in Touch With Us