When the City of Philadelphia officially took the wraps off of its controversial “Wireless Philadelphia” initiative on April 7, 2005, officials dispelled a lot of rampant speculation that the municipality would transform the entire 135-square-mile city into a huge community hotspot. Instead, the City unveiled a Business Plan that detailed an innovative effort to build a wireless infrastructure that would not only serve the underprivileged but also serve as wholesaler for any Internet service provider (ISP) interested in tapping into a wireless marketplace. On Monday, April 18, the City held a pre-proposal hearing at a downtown municipal building to answer questions that anyone had about its Request-For-Proposals (RFP) to help build that wireless infrastructure. Anyone wishing to bid on the lucrative $10 million contract was required to attend.
The response was a standing-room-only crowd of enterprises ranging in size from Sprint, Lucent and Unisys down to small women- and minority-owned businesses from all over the United States as far as California and Michigan. Presiding over the meeting was the chief architect of the “Wireless Philadelphia” plan, Dianah Neff, Chief Information Officer of the City of Philadelphia. After the meeting, Ms. Neff sat down with TMCnet Executive Editor Robert Liu who filed this interview for INTERNET TELEPHONY® magazine.
IT: We’ve heard a lot about the Wireless Philadelphia project even before the business plan was announced. Do you think a lot of fear coming from the business community was sparked by confusion not knowing the details of that business plan?
Neff: Well, I do believe the private sector has voice several concerns about the involvement of government in broadband initiatives including using taxpayer funds, unfair competition and it was a disincentive for the private sector. I truly believe the “Wireless Philadelphia” model has really overcome all of those and addressed all of those concerns. We are not using any taxpayer dollars. We’re not going for tax-exempt financing. We’re not using city dollars to finance the program. It enables a level playing field. So it really provides for the private sector companies to be able to leverage the network and it establishes a unique public-private partnership.
IT: You’ve come from the private sector. So was the fear justified in your view?
Neff: I wouldn’t classify the concerns raised by the private sector as “fear.” I would classify it as a lack of understanding of the needs of most communities.
IT: Your plan is being seen as a litmus test for the U.S. telecommunications industry. Do you think this will help define the role of government and its involvement in providing Internet infrastructure?
Neff: Yes, the trend by municipal government to be more involved in broadband initiatives is an indication that, like technology, policy decisions are becoming increasingly decentralized moving from a federal level to state and local governments. I think it provides a unique model that we believe addresses the best of taking care of the community and what its needs are. We believe that municipal governments are the primary deliverers of services to their community and they know the community needs. We are the safety blanket. For example, with health insurance, the City has nine clinics. Healthcare companies and insurance certainly haven’t gone out of business. The hospitals haven’t gone out of business by the City having health clinics for those who don’t have health insurance, for those who can’t get into a hospital. That’s why we’re there to provide that safety net. And we believe for a City to be viable in the 21st Century, it has to ensure that its citizens — all of its citizens and not just those that can pay — has access to advanced technologies that the private sector is providing.
IT: So Internet access isn’t at all a privilege, it’s everybody’s right?
Neff: Well, I think it’s a needed skill set. It’s having the basic computer skills, having the ability to transact your business and your life over the Internet. It is critical for going forward into the future.
IT: Are ILECs allowed to respond to the RFP?
Neff: Absolutely, there are no provisions against anyone bidding on this.
IT: How does the City view someone of Verizon’s size and stature bidding?
Neff: It will depend on their response to the RFP. If they put together a quality proposal, we will look at it just as we will any other proposals that come in.
IT: Do you think that a smaller sub-contractor would have a better chance partnering up with an enterprise solution vendor like a Verizon?
Neff: I don’t think it breaks that way at all. I think it’s an opportunity because of what we are requesting in the RFP for companies to come together and partner. And I think the best turnkey solutions will be those that come together. I don’t know any one company — and I could be wrong because obviously I haven’t seen any proposals — that could proposal on all of the requirements in the RFP. I think we’ll see groups of companies coming together and selecting a prime [contractor] and submitting a proposal.
IT: Would you favor a consortium over a single large bidder like Lucent, Sprint or Verizon with a turnkey?
Neff: We’ll apply the same criteria of evaluation whether they are large consortiums or a single vendor coming in. We’ll really be looking at how well they address the requirements; what’s the stability of the organization; do they have the resources to be able to perform. We’re going to be looking very closely at all those issues.
IT: Verizon already has established a large infrastructure footprint of its own. Why would you build an infrastructure rather than lease it? What’s the cost-benefit analysis?
Neff: One of the major differences was DSL as a fixed wireless [technology]. An ILEC infrastructure is inherently fixed based on technologies like DSL and cable. It does not provide the nomadic and portability outdoor wireless. Wireless Philadelphia recognized the increasing value proposition placed on nomadic and portable broadband, which was a needed criteria as we looked at this system. For example, for our field inspectors or any company that has service delivery or field operations, you need outdoor wireless. We’ve done studies that show by having high-speed access to data that we can save as much as two hours per inspector per day. That’s a real cost efficiency that we need. We’re in the process of re-evaluating all 600,000 parcels in Philadelphia. You either have to bring in lots of people or you need to use the technology. The cost for even slower speed cellular is too expensive. And this community network will provide us with the access that we need.
IT: You are requesting only Fixed Price contracts. Would you consider any cost incentives built into the contracts?
Neff: No. The RFP states there is a section for counter-proposals and we will consider including the ones that suggest alternative business models and proposals that include cost-risk sharing.
IT: So then you see that structure in a contract as a different business model altogether?
IT: Do you believe the architecture will be based on an open platform (BSD or Linux) vs proprietary platforms?
Neff: In the security portion of the RFP, the City is requiring authentication and the capability to have different standards whether it’s encryption or VPN tunneling. So what we will do is evaluate the responses that come back in and compare that and look at what the differences are. We expect we’ll see a number of different proposals and some commonalities between the proposals. The [City] will evaluate those recommendations once all bids are received. So we haven’t predetermined what that is because part of the RFP is to design the infrastructure but it is an evaluation criteria.
IT: Will the City give greater weight if the turnkey solution includes value-added services or service bundles like solutions that incorporate VoIP providers?
Neff: They’re optional. We’re looking to provide the basic infrastructure and then make it an open inclusive network so that the private sector can deliver value-added services over that infrastructure. We want to make sure we have a robust infrastructure that will allow it but it is not a requirement. Obviously, we’ll be looking at the future of the network — where it goes. The base connectivity is to provide Internet access with e-mail and newsgroups and basics like that. Then there will be an opportunity to add value-added services that companies can deliver over that infrastructure.
IT: You announced at the pre-proposal meeting that the City is still working out the terms for a service level agreement (SLA) to define the parameters of the service that will be delivered on the wireless network for the benefit of both the provider and the recipient. Do you think the SLA details will be finalized before the May 23 bid deadlines?
Neff: We have currently on our program scheduled to be working through the SLAs in the month of June. The responses will be coming back in at the end of May.
IT: So respondents won’t really have a chance to include service providers in their bid because they won’t know what the SLA includes?
Neff: Correct…although I do want to give you a clarification on this. In the Business Plan, we talk about that and the different service offerings that we’re expecting the ISPs to be able to do because that reflects back on the type of infrastructure that the network people have to build. So that information is in the business plan so they have the basic idea. They just don’t have the specific details of what that service level agreement will require. We have estimates on subscribers and the types of services that we expect to see the ISPs providing.
IT: Ms. Neff, Thank you.
Responses were due to be received by May 23, 2005. The Wireless Philadelphia initiative will select winning respondents with which to enter into contract negotiations by July 25. The project is scheduled to begin construction by August 22, 2005. IT