Blanket hotzone boosts mobile business in Toronto

Industry analysts have praised Toronto’s plans for a city-widemunicipal Wi-Fi network, welcoming Toronto Hydro Telecom Inc. as amajor player in business-grade wireless connectivity for ubiquitousInternet access.

The proposed network poses an obvious and very serious threat totraditional telcos such as Bell, Telus and Rogers because theservice will be much more than consumer-grade, say analysts.Quality of service will be supported by the utility telco’s NetworkOperations Centre that monitors network traffic to guaranteemaximum bandwidth.

Toronto Hydro Telecom yesterday announced it would beginbuilding out a mesh of Wi-Fi access points to create a wireless hotzone that would blanket all 630 square kilometres of the city bythe end of 2009.

The utelco is targeting the financial district by the end ofJune and hopes to have the downtown core covered by the end of theyear.

The company is not new to offering secure, enterprise-classInternet connectivity. Among its customers are four of Canada’sbiggest banks, who use Toronto Hydro Telecom’s Gigabit Ethernetfibre optic network to transfer data between their Torontosites.

Analysts pinpointed the ability to connect to the Internetseamlessly from anywhere as the biggest draw for municipal Wi-Fi.Each time they log on, users can connect with one password and noconfiguration issues even to a different service provider.

Ubiquitous coverage combined with high bandwidth makes TorontoHydro Telecom’s offering a strong, viable alternative to thecellular carriers, says Lawrence Surtees, vice-president andprincipal analyst, communications research at IDC Canada Ltd.

The utelco’s Wi-Fi coverage will reach further across the citythan any of the telco’s and Wi-Fi’s 2Mbps transfer rates and farexceeding the 400-700Kbps of 3G broadband cellular.

“First and foremost, what makes this different is it’s ablanket. It’s not little areas, so right off bat they have astarting point, a reason for customers [wanting] to go to them. Theservice is aimed at being different, covering your home and youroffice,” says Surtees.

“And if you’re offering better coverage and Internet accessthat’s better and faster than a mobile wireless data service, thenthat’s another point of differentiation to think about.”

For a competitive pricing model, Surtees says Toronto HydroTelecom should be looking not only at the market’s Wi-Fi accessprices, but also at monthly and pay-as-you-go Internet accessmodels. “The service needs to be not just different, but alsobetter and/or cheaper.”

Garry Foster of Deloitte & Touche LLP in Toronto describesthe city’s project as a great plan, but cautions adoption rateswill be slower than anticipated.

“Businesses won’t be giving up their wired networks immediately,but as they learn to layer in security…this will get slow andsteady pick-up and then as it gets proven it’ll get fasterpick-up,” says Foster, Deloitte’s national director of technology,media and telecommunications.

Wi-Fi is on its way to overcoming one of its biggest challenges,he adds. The technology hasn’t yet shown itself capable of widecoverage, but the Toronto hotzone has the potential to proveWi-Fi’s full benefits.

“The beauty behind something like this is you’ve got onewireless network, one password and no protocol and firewallissues.”

Using Wi-Fi to connect to the Internet from anywhere will makeit particularly attractive to the city’s mobile workforce, saysAlicia Wanless, an analyst at Seaboard Group in Toronto.

“Mobility for employees has increased a lot, so getting Internetaccess anywhere is quite exceptional,” says Wanless. “As acompetitor, Toronto Hydro Telecom has really opened its doors andincreased its visibility. It’s a really great move on their part,in terms of competing against the telcos.”

According to Surtees, certain civil servants at Industry Canadaare believed to be “somewhat chagrined” with the reluctance of themajor incumbents to roll out city-wide Wi-Fi coverage.

“It starts to make sense why incumbent phone companies such asVerizon in San Francisco and SBC in Philadelphia have theirknickers in a knot about comparable muni-services down there; andwhy I think Bell, Telus, Rogers are going to be possibly freakingout over this,” he says.

“They have oodles of the same unlicensed spectrum [in the 2.4GHzband], but they’re not making use of that valuable spectrum. Theyhaven’t rolled out any seamless, ubiquitous service. I say allpower to Toronto Hydro Telecom for trying to do this.”

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