Wireless Washtenaw in doubt: Federal funding rejected, 20/20 Communications exits deal
The federal government rejected Wireless Washtenaw’s stimulus funding application - one of several developments that places in doubt six-year-old plans to extend high-speed Internet access to the entire county.
The relationship between the county and Wireless Washtenaw project manager 20/20 Communications has collapsed, punctuated by the federal government’s rejection of the program’s $4 million stimulus application.
Responsibility for the network has tentatively shifted to Southfield-based Internet 123 Inc., also known as 123Net, which does not share the original vision of the project.
Ann Arbor-based 20/20 Communications, which managed the beleaguered program on behalf of the county for six years, quietly sold rights to 400 to 500 customers to 123Net, the companies announced yesterday.
That deal marks the end of a business relationship that has cost 20/20 more than $2 million.
Washtenaw County information technology director and Wireless Washtenaw project manager James McFarlane
Lon Horwedel | AnnArbor.com
Former 20/20 Communications President Bob Wolff confirmed today that he left 20/20 and no longer has an ownership stake in the company. 20/20 Vice President Debbie Peterson could not be reached for comment.
123Net President Dan Irvin told AnnArbor.com today that the vision of creating a wireless cloud that provides access to all 347,000 residents of Washtenaw County is not realistic.
“That’s a pretty tall order,” he said. “Some of those areas are not commercially feasible.”
Irvin said 123Net is developing separate plans to launch a free wireless Internet network in downtown Ann Arbor.
“We don’t have those plans quite solidified yet,” he said. “I’m quite excited about it.”
Complicating the deal between 123Net and 20/20 Communications, however, is a clause in the 42-page Wireless Washtenaw contract that requires the county to approve any deals that shift responsibility for the network to another company.
Former 20/20 Communications President Bob Wolff
Lon Horwedel | AnnArbor.com
“I’m frankly not up to speed on that clause,” Irvin said. “We had one meeting with the city and the county and it was just very positive.”
James McFarlane, information technology director for Washtenaw County and project manager of Wireless Washtenaw, said the county is reviewing the deal and will decide whether to endorse 123Net as Wireless Washtenaw’s new manager.
“It specifies in our contract that any additional partners that 20/20 brings on need to be approved by the county,” McFarlane said. “So we’ve asked for business plans and some financial statements. We’re doing our due diligence to make sure this new partnership will meet the vision of the project.”
Wireless Washtenaw had about 550 regular customers when the project applied for $4 million in federal stimulus last fall. The county could file another application through the second and final round of stimulus awards, but county and company officials said that’s unlikely.
“The Wireless Washtenaw project has been and is a significant undertaking,” Peterson said in a statement. “With Dan’s visionary leadership and the experience of the 123Net team we look forward to bringing this project to fruition and applying the lessons learned from other Michigan counties."
Irvin said 123Net acquired 400 to 500 residential customers from 20/20 in addition to a dozen collocation customers. He said 20/20 would continue to sell data plans, but 123Net is operating 20/20’s networks.
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Wireless Washtenaw Timeline 2004: Washtenaw County officials and business leaders hatch an idea to provide wireless Internet access to the entire county. |
He said 123Net has about $12 million in annual sales from its telecommunications business, including phone customers and Web data plans.
Wireless Washtenaw launched in 2004 amidst national hype for municipal wireless networks.
County and local municipalities agreed to provide free access to government structures where 20/20 could install wireless Internet equipment for the networks. But the county did not invest any funds in the project, except an initial $70,000 to finalize contractual details, leaving 20/20 to take on the financial risk.
Officials hoped to provide low-speed Internet access for free and high-speed access at a cost.
20/20 built a 100-square-mile network that continues to operate, but the company was never able to convince outside investors to fund the expansion of the network to the county’s 720 square miles.
Wolff, one of the visionaries behind the project, said today he left 20/20 because the company could no longer afford to employ him and that he wasn’t not angry about the outcome. He said the county still needs improved Internet connectivity options.
“I still think there’s a need in this county,” he said. “I still think there’s a digital divide. If anything, at the end of the day, we raised great awareness.”
Contact AnnArbor.com’s Nathan Bomey at (734) 623-2587 or nathanbomey@annarbor.com or follow him on Twitter. You can also subscribe to AnnArbor.com Business Review's weekly e-newsletter or the upcoming breaking business news e-newsletter.
Comments
seldon
Sun, Mar 14, 2010 : 1:08 a.m.
@Just the Truth: Aha. Yeah, that is a problem.
Dug Song
Sun, Mar 14, 2010 : 1:06 a.m.
@Moose - Google's fiber RFI is very real (which the @a2fiber folks are working hard to meet), but it has nothing to do with providing universal coverage to traditionally out-of-reach areas (Google is specifically looking for density and low build-out cost in their experiment). Neither does WirelessYpsi, as @Just The Truth helpfully explains. A more realistic possibility for such coverage is 4G WiMAX, such as the Zing folks provide in Southeast Michigan (recently acquired last year by Southfield's 123.net): http://getzing.com/ I've exchanged mails with their founder, Tolly Marcus, about setting up on the giant orange smokestack of http://techbrewery.org where IAS.net used to have a 20Mbps point-to-point microwave link to Merit set up. We'll see...
Just The Truth
Sat, Mar 13, 2010 : 8:34 p.m.
Apparently no one see the three glaring problems with "Wireless Ypsi". First, the "cloud" is just a bunch of wireless gear sharing residents' existing DSL or Cable internet connections -- which violates the terms of service of those existing connections. Second, they are "novelty" connections -- wireless Ypsi depends heavily on volunteers and cannot market any level of reliability much less consistent, high speeds. Finally, this does not extend to lower density areas of the county where there is no existing DSL or Cable connections. If you do not believe me, just review the wireless Ypsi website.
seldon
Sat, Mar 13, 2010 : 1:42 p.m.
What are the actual barriers to Wireless Ypsi simply expanding into Ann Arbor? It's probably time to ignore Wireless Washtenaw and just route around it.
Moose
Sat, Mar 13, 2010 : 8:43 a.m.
Wireless Washtenaw network is far amore important and real than the vaporware Google fiber effort. Wireless Washtenaw should be resuscitated and coordinated with the potential Google fiber network.
tdw
Sat, Mar 13, 2010 : 8:11 a.m.
wrireless Ypsi will never work.Ann Arborites won't have anything to do with anything that has the word "Ypsi" connected to it
Dave Strenski
Fri, Mar 12, 2010 : 9:40 p.m.
Seriously, look at the WirelessYpsi Map. http://p2.meraki.com/network/WirelessYpsi They have most of Ypsilanti covered and parts of Ann Arbor. We need to get the remains of Wireless Washtenaw and give them to WirelessYpsi and keep spreading the network. Last week they had over 2000 users logged in.
Kelly
Fri, Mar 12, 2010 : 6:07 p.m.
"Ann Arbor-based 20/20 Communications, which managed the beleaguered program on behalf of the county for six years, quietly sold rights to 400 to 500 customers to 123Net, the companies announced yesterday." So they silently slipped out the back door while everyone was waiting for Washington to say no to a project they couldn't get up and running in 6 years? Truly, there are no mountains in Washtenaw County. I have yet to travel in a tunnel in Washtenaw County either. 6 years later and still haven't delivered? Looks to me as though they never intended to deliver. How's this for an idea? Let's have a technical scholarship contest? The group or individual that gets high speed internet to everyone "in the boonies" get a four year tuition only scholarship. I bet that would cost a lot less than what didn't work over the past 6 years.
Duane Collicott
Fri, Mar 12, 2010 : 5:44 p.m.
I think the window of opportunity for this, time-wise, was back in 2005-2006, and geography-wise, was in areas where people didn't have other options. That is, when and where people actually needed it.
John of Saline
Fri, Mar 12, 2010 : 5:22 p.m.
So less than 1000 people use this service after all the money dumped in so far? Why on Earth would anyone put MORE money into this? Why do you need wireless over every square inch of the county?
Tom Joad
Fri, Mar 12, 2010 : 3:21 p.m.
Seriously, can you trust a company whose clock on the front of their building is 1 hour ahead?
Nathan Bomey
Fri, Mar 12, 2010 : 3:10 p.m.
Might be worth noting that the county last summer chose to endorse Wireless Washtenaw's funding application instead of partnering with Wireless Ypsi. http://www.annarbor.com/business-review/wireless-washtenaw-stimulus-application-gets-countys-endorsement-despite-wireless-ypsis-emergence/index.php
CountyKate
Fri, Mar 12, 2010 : 3:05 p.m.
Yes, this is Steve's area of expertise and Wireless Ypsilanti is an up and going concern without the spending of millions of taxpayer dollars. If Washtenaw County really wants to be wireless, he'd be the one to talk with.
M.
Fri, Mar 12, 2010 : 2:48 p.m.
Steve was so friendly in helping me with questions I had about Wireless Ypsi. I'm sure given enough time and community involvement Wireless Ypsi could expand to a wider region.
Cash
Fri, Mar 12, 2010 : 2:40 p.m.
Calling Steve Pierce! Calling Steve Pierce!! He has created wireless Ypsilanti and then Washtenaw County snubbed him for Wireless Washtenaw. Maybe it's time to eat some crow and make a call to Steve for help.