Toronto’s One Zone municipal Wi-Fi up in the air

Cogeco Cable Inc.'s plan to acquire Toronto Hydro Telecom (THT) as of July 31 adds more uncertainty to the future of the utility's One Zone municipal Wi-Fi network. Despite the slower than anticipated growth, however, its president is still bullish on its long-term relevance."I still think municipal Wi-Fi is a viable option," says THT's president Dave Dobbin. "The network works really well. It is a constant and reliable source of revenue."Maybe so, but as it stands One Zone contributes less than 1% to THT's overall revenue. It also covers off a small area, at only six square kilometres in Toronto's downtown core. There has been some expansion in the past year, but it's been modest, reflecting uncertainty with the One Zone business model and the viability of Wi-Fi for extensive outdoor use."We covered off the Esplanade and the Queens Quay areas," says Dobbin, referring to two densely populated neighbourhoods along Toronto's waterfront. "And we did a bit of expansion east along Parliament Street."At present One Zone uses the 802.11g Wi-Fi standard, with THT trialing 802.11n, which would add significant capabilities - and cost - to the network. At present One Zone holds bragging rights to being the largest Wi-Fi network in Canada, though, given its modest size, this says as much about the slowness of the build-out and the lack of relevance of public Wi-Fi to other jurisdictions.Mark Tauschek, a senior research analyst at Info-Tech Research Group in London, ON, says that with THT in hand Cogeco can integrate One Zone with its own infrastructure, though it would be tricky. As well, according to Tauschek, the future technological roadmap adds more uncertainty."Going to 802.11n would improve performance, though One Zone performs quite well compared to other municipal Wi-Fi networks," says Tauschek. "In terms of WiMAX, they could use it for backhaul. There might be some spectrum licensing issues, though it will be available at 5 gigahertz, which is unlicensed."Tauschek adds WiMAX's impact is still a few years out: Intel's Centrino 2 "Montevina" chip with WiMAX support will be ready this summer, but it will take one to three years for there to be critical mass. The end result is that, for now, Cogeco will likely let One Zone stay pretty much as it is."I wouldn't think that Cogeco is going to put any money into it," says Tauschek. "I'd be shocked if they did."THT's director of corporate communications described One Zone as a "more of a value-add" product for Cogeco. "We see it as an additional service for our customers, and not really something that we want to develop as a standalone product," says Marie Carrier.Upgrading to WiMAX a longer term optionLawrence Surtees, VP and principal analyst, communications research, at IDC Canada Ltd, suggests that a network like One Zone could migrate into something more viable."Municipal Wi-Fi was a hiccup," says Surtees. "This will continue to evolve and change, and will ultimately become last-mile WiMAX broadband. That's why a lot of municipal players in North America are sticking with it."Like Tauschek, however, Surtees doesn't see any big changes for at least a few more years. "When the chipsets support nomadic, mobile WiMAX," he says, "then things will really take off."Amit Kaminer, an analyst with the Seaboard Group, agrees: "It could easily upgrade to WiMAX for more ubiquitous coverage. There are a lot of possibilities - it's interesting that Cogeco didn't bid on the wireless auction; One Zone gives them the option to leverage a wireless play."However, independent telecom analyst Jon Arnold points out that part of the original plan for One Zone, which was to supplement Toronto Hydro's meter reading capabilities, may now be lost."I really don't have a clue what Cogeco will do with this," he says. Rogers Communications and Bell Canada Enterprises weren't happy to see One Zone come in, but one of Toronto Hydro's initial justifications was on the operations side of things, to lower the cost of electronic meter reading and to pass the savings on to customers. A subscription service would then be a bonus."Part of the problem, says Arnold, is that One Zone is primarily an outdoor service, without much applicability for home users. It caters to people who are on the move in the core, but this is a limited market."The reality is that in Toronto we aren't outside a lot," he says. "One Zone is not really an all-season, 365 day service. When you look at that $200 million price tag for Toronto Hydro Telecom, One Zone isn't a big piece of it. It hasn't generated a lot of traction, and I don't see much growth potential."

Toronto’s One Zone municipal Wi-Fi up in the air

News | 07/02/2008 2:06 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