City of Seattle could enter Internet business

By Peter Lewis
Times consumer-affairs reporter

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The city of Seattle may rethink its decade-old decision to stay out of the Internet business.

Under a resolution introduced yesterday by City Councilman Jim Compton, Seattle would explore becoming an Internet wholesaler by tapping into unused resources and applying new technologies, including wireless systems.

Ideally, Compton said, residents would be able to use the city's network to surf the Web and pay less than they are paying now. As a model, he pointed to the Click! Network that's been operating since 1998 in Tacoma, where 11,000 high-speed Internet customers pay $25 to $30 a month to one of three Internet-service providers who partner with the city.

The big question, Compton said, is coming up with a viable business model. Similar concerns helped drive Seattle's decision to steer clear of the Internet business in the mid-'90s, when council members determined that broadband was best left to private enterprise.

Yesterday, Steve Kipp, a spokesman for Comcast, a major provider of high-speed Internet in the region, said his company would reserve comment until it has had more time to meet with city officials and learn more. He noted, however, that Comcast could become a partner, because the resolution was "broadly written to include possible collaborations and partnerships with the private sector."

In Seattle, Comcast charges $46 a month for customers who also buy one of several cable-TV packages from the company. It charges $51 a month to Internet-only customers.

Compton's resolution was to be discussed today at the council's Utilities & Technology Committee, of which he is chairman. It calls for forming a task force to evaluate the feasibility of the city becoming a telecommunications and Internet wholesaler.

The task force would consist of the city's chief technology officer, a member of the Citizens' Telecommunications and Technology Advisory Board and others from the technology or telecommunications industries. The panel would report back to the council by Oct. 15.

Compton said he was inspired after he participated late last month in a meeting of technology "visionaries," including representatives from the University of Washington, Microsoft and RealNetworks, among others. The upshot of that meeting, he said, was, "Why don't you do something bold and step up to this?" referring to the city taking an aggressive role to provide broadband service.

Yesterday, he alluded to miles of unused fiber-optic cable that the city could tap to provide high-speed Internet capacity to others to market.
 
In addition, he identified various wireless technologies, including Wi-Fi and Wi-Max. The former generates a relatively short-range Internet signal while the latter extends one to three miles.

Another possible technology the resolution identified is broadband over power lines, in which an Internet signal rides over ordinary electric wires. Users access the Internet by plugging a modem into any outlet.

Bill Schrier, the city's chief technology officer, said he did not know about Compton's proposal before it was introduced. Alluding to the meeting he attended with Compton in late May, Schrier said, "I'm not quite sure how we got from that to this (the resolution)."

Still, he said, "This sort of thing has some interest." Wireless wasn't nearly as developed a decade ago, Schrier said, when the city last seriously considered becoming a player in the Internet game.

Peter Lewis: 206-464-2217 or plewis@seattletimes.com