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Wednesday, October 08, 2008

Radford looks to 'cut losses' with Radnet

The city's wireless Internet system has only about 300 paying customers.

Radnet is on the block.

The wireless Internet system Radford's government launched in 2006 has come to the end of city council's fiscal patience, so the city is looking for someone else to come in to run it.

"It's taxpayer money. The taxpayers have a say," said economic development director Basil Edwards. "I guess that voice has gotten to council."

Some council members didn't need to hear much.

"There comes a time when you've just got to cut your losses," Mayor Tom Starnes said on the July night council cut funding for the system. "I guess I'm saying I don't think it will ever break even. I thought it was a loser from day one."

The system has been a loser in the sense that it hasn't made enough money to pay back the $1 million investment council allocated. In July, council voted not to let Radnet have the last $50,000 of that allocation.

But Radnet has generated enough money to keep itself going, Edwards said.

About 5,000 Radford University students live off campus, Edwards said. If 1,500 of them would subscribe to Radnet, he said, the system would make enough money to perpetuate itself and pay off the city's investment in three to seven years. But the system has only about 300 paying customers.

"Maybe the market's just not as big as we thought it was," Edwards said. "When we got into this game a couple of years ago, there were a lot of municipalities getting into the wireless business."

Companies were willing to install systems in larger cities for free and enter into agreements that paid local governments for the privilege of putting the necessary equipment on power poles. Radford doesn't have the population concentration to make that attractive, Edwards said. So the city built the system itself. It wouldn't have been built otherwise, he said.

There have been some coverage issues, but "it's still a good system and it works well," Edwards said.

It just needs someone with the expertise and the wherewithal to take it to the next level, he said. Maybe turn it into a citywide system.

The request for proposals, posted on the city's Web site, calls for proposals to be in by 3 p.m. Nov. 14. After that, the city will evaluate the proposals, perhaps negotiate with some of the proposers, then decide whether any of them can take the system to the next level, as Edwards hopes.

If not, Radnet will continue as it is, but customer satisfaction will likely decline, Edwards said, as the system slowly degrades and becomes outdated. The city has decided not to invest more money in Radnet, but Edwards seems convinced someone else will.

"I think there are some people out there," he said.

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