NYC’s Plan for Free, Citywide Wi-Fi

Private companies are paying the city $500 million to transform old pay phones into high-speed Internet hotspots. Is it a plan other cities can copy?
by | February 2015

Alex Marshall

Alex is a Governing columnist and a Senior Fellow at The Regional Plan Association in New York City.

A mockup of the new kiosks that will replace old pay phones across the city. Citybridge

What is a phone booth without a phone? In general, it’s an eyesore. But not in New York City, where beginning this year old phone booths will be transformed into about 10,000 sleek metal slabs that will provide high-speed digital access throughout the entire city.

The plan is called LinkNYC, and it’s important for two reasons. One, it may be a plan other cities can copy -- there are certainly plenty of old public pay phones around. Two, it’s an example of reimagining old assets and connecting citizens to what is increasingly a vital and life-enhancing service: the Internet.

The project originated under Mayor Michael Bloomberg and his Reinvent Payphones Design Challenge. But Mayor Bill de Blasio is carrying the program forward, arguing it’s a way to help address the digital divide.

The city has entered into a contract with a consortium of private companies, acting under the name CityBridge, which will tear down the roughly 9,000 old pay phones and replace them with kiosks fit with a screen, telephone and charging port for mobile devices. Users will be able to walk up to these screens and get information, call 911 or call anywhere in the United States for free.

Most important, New Yorkers will get really fast Internet service. Within a radius of 150 feet, most kiosks will provide a gigabyte per second service, a speed almost unimaginable to most Americans (although not uncommon in some other countries). At this speed, a two-hour, high-definition movie will download in about 30 seconds, and up to 250 people can use it at one time without diminishing service, according to the consortium.

You can imagine how this will change life in the big city. Will we see hordes clustering around these stations, laptops in hand? Will apartments within 150 feet of the kiosks go up in value?

Not only will New York City residents get high-speed Internet access, but the city government will also get an estimated $500 million in direct payments from CityBridge over the next 12 years. So the next question is, what does CityBridge get? Revenue from advertising, which will play on most of the screens. It’s a variation of what New York has already done with its citywide bike system. A private company supplies the bikes, pays most or all the cost and in return gets the advertising.

The expenses of such a system are not inconsiderable. These new kiosks have to be designed and built, software written, sidewalks dug up and supplementary fiber-optic lines laid. Can advertising really pay for all this? Apparently so.

One factor here -- and something for other cities to consider -- is that digital advertising on, say, a bus shelter pays four to five times what conventional advertising does on that same shelter. This is because you can change a digital ad every few seconds, thus selling the same space multiple times. And expenses are lower, because you don’t have to physically send someone to change the ad.

There are a few wrinkles in the plan, however. The principal appeal of the plan relies on access to what is the gold of our digital age: fiber-optic lines. This in turn gets into what is underneath the sidewalks and old pay phones. In Manhattan, it will be easier to tap into existing fiber-optic networks of largely private companies, including Verizon. In some of the poorer, outer boroughs, the Internet service will have to go through old-fashioned copper cables, which means much slower speeds -- although typically still faster than what most homes have. The city has pledged to use some of the revenue from the plan to improve service in these places.

How would high-speed public Wi-Fi networks work with what, to me, is still the best option: municipal fiber-optic networks, such as the ones now enjoyed by Chattanooga and smaller towns like Lafayette, La.; Wilson, N.C.; or Galax, Va.? They would complement each other. Ideally a public utility could supply high-speed Internet access via Wi-Fi in public parks and streets, and through fiber-optic lines into homes and offices.

Will other cities follow New York’s lead? It’s a nice thought that all those old, mostly useless phones will become digital hubs. Smaller towns and cities might not generate as much advertising revenue per kiosk -- something that needs study -- but a city could supplement the costs.

And what about nostalgia for those phone booths? LinkNYC has pledged to leave three old-fashioned telephone booths on the Upper West Side.

0 comments

More from Economic Engines