Hermosa Beach takes on ISPs with free Wi-Fi offer. (Media & Technology).

Internet service providers are getting competition from an unlikely source: local government.

This fall, the city of Hermosa Beach is planning to install antennas that give anyone with the right hardware free Internet access.

In pushing to open the city up via the emerging high-speed wireless fidelity (Wi-Fi) standard, Hermosa Beach Mayor Michael Keegan is touting the business development opportunities and the democratic nature of the Internet.

"A small business will save $100 a month and the city's picking it up," said Keegan. "We view this as something like turning on the water. If cities can run these models without a ton of administration, it's what the 'Net is all about."

San Diego-based Wireless Facilities Inc. is supplying the antennas and will maintain the first phase of the network, which will cover the downtown area surrounding city hall. The city will spend about $2,500 per month as the program rolls out to cover the whole community.

As part of the deal, Wireless Facilities will bear the $30,000 to $50,000 cost of the first phase installation, with the city funding further build-outs planned for later this year.

A citywide network could cost an additional $70,000 and involve several more antennas. Local business donations, a small subscriber fee and promotional involvement of wireless computer companies are all options the city is considering to pay for the roll out. Or it may merely cut another city program to pay for it. Using an antenna that's connected to a high-speed Internet connection, Wi-Fi transmits the signal anywhere from a few hundred feet to several miles. Anyone within the network can catch the signal using a computer with Wi-Fi equipment instead of paying for a landline Interact connection.

Stephen Burrell, Hermosa Beach's city manager, said his staff is reviewing Wireless Facilities' proposal and would present its findings to the five-member city council on Aug. 12. The plan needs approval of council, which Keegan said he expected.

Private objections

The effort is not being met with open arms by other Wi-Fi businesses that stand to lose customers to the free service.

"Does empowering a city with free Internet access have social benefits that outweigh the benefits of city revenues from business licenses, utility taxes and possible Internet access taxes?" asked Ronan Higgins, founder of Cafe.com, a Santa Monica company that sets up Wi-Fi systems in coffee shops. "If so, why have cities not been offering free Internet access in the past?"

Phone companies that provide DSL and fiber services have been battling the communal nature of Wi-Fi, but Jim Smith, a spokesman for Verizon Communications, which supplies the city's high-speed Internet access, shrugged off the Hermosa Beach effort.

"If we lose some T1 lines from the city of Hermosa Beach because they found an alternate solution," Smith said, "then that's the free marketplace at work."

Some analysts see difficulties in managing the network if it expands into residential areas. Wi-Fi is better suited to indoor networks with little or no obstruction, and outdoor networks have been known to experience outages and can be expensive to maintain.

"Sooner or later even free community-based networks have to have service quality. The city will have to subsidize this because it will be an expense," said Michael Cai, a research analyst at Dallas-based Parks Associates who recently released a report on emerging business models using Wi-Fi.

Hermosa Beach joins San Diego, Seal Beach and Long Beach in implementing public wireless networks. While the other cities have focused their service on public or retail areas, the Hermosa Beach network is the only one that aims to cover business and residential areas.

The city estimates there are 4,000 high-speed DSL users among its 19,000 residents.

Its network is likely to overlap with the network set up by T-Mobile USA Inc. and Starbucks Corp., which has a location within blocks of city hall.

Richard Burdvik-Lindner, a spokesman for T-Mobile, pointed to its nationwide coverage and questioned the ability of Wireless Facilities to manage the city network.

"I don't know their track record for this kind of thing. There is some overlap but this is healthy tension in the growth of Wi-Fi we are willing to bear," he said.