In Portland, Oregon, another city-wide Wi-Fi network bites the dust

In the latest of a lengthening string of failures in city-wide wireless projects across the US, MetroFi of Mountain View, CA has reportedly stopped work on a project in Portland, Oregon.

After installing 590 functional wireless access points (APs) in Portland, MetroFi has asked the city to provide $9 million in public funds to finish the job with an additional 2,000-or-so APs. Another MetroFi customer, the city of Toledo, Ohio, decided last June to sell its municipal wireless project to Cincinatti Bell, after the wireless provider asked municipal government to kick in $2.16 million on the project over the ensuing five years.

Yet MetroFi is hardly the only municipal Wi-Fi provider to be running into problems these days. For example, a city-wide network in San Jose, CA -- under implementation by Wireless Silicon Valley -- is likewise stalled.

Meanwhile, last fall, EarthLink decided to exit the municipal Wi-Fi business entirely, after trying to deploy its "Feather" wireless broadband service across at least thirteen cities.

"We will not devote any new capital to the old municipal wireless model that has us taking all the risks. In my judgment, it's simply unworkable," said EarthLink CEO Rolla P. Huff, in a written statement last November.

During a financial conference call earlier this month, Huff said that, by the end of December, 2007, EarthLink had decided to sell off its wireless assets. The failures seem to be happening regardless of the carrier's revenue model.

MetroFi and Wireless Silicon Valley have both been trying to create networks that provide free wireless access to city residents. But in the case of MetroFi, at least, the access is only free to residents who agree to view online ads in exchange. Other residents can also gain access, but only at a price.

Both these companies have found it tough or even impossible to get the funding needed to build out the networks from either private investors such as venture capitalists or municipal governments. For MetroFi, the hoped for ad revenues have proven elusive.

EarthLink, on the other hand, had been charging subscribers for their choice of either a monthly or hourly access plan.

The strategy behind "Feather" revolved around undercutting the pricing of traditional broadband networks, such as cable. But Feather ran into some technical troubles that raised costs. In Anaheim, for example, the Feather receivers reportedly wouldn't work at all in places where the walls were too thick.

Beyond that, extra receivers needed to be installed in buildings three stories high or taller -- or wherever Feather needed to compete against other wireless networks.

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