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Philadelphia, Verizon Strike Deal on WiFi

Agreement Allows City to Provide Internet Access Even as Industry's Bill Is Signed

By Marc Levy
Associated Press
Wednesday, December 1, 2004; Page E04

HARRISBURG, Pa., Nov. 30 -- The city of Philadelphia and Verizon Communications Inc. struck an agreement Tuesday that would allow the city to provide wireless Internet access as a municipal service even though Gov. Edward G. Rendell (D) signed legislation giving Verizon the power to scuttle the project.

Lawyers for the city and Verizon, the city's local telephone company, found common ground Tuesday in discussions with the governor's office, said spokeswomen for Verizon and Philadelphia Mayor John F. Street.

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The parties "reached an understanding that protects our interests and allows us to move forward with the . . . initiative," Street's spokeswoman Luz Cardenas said.

Philadelphia's plans are the most ambitious of any major U.S. city to provide free or inexpensive high-speed wireless access to all residents.

The agreement relieves pressure on Rendell, a former Philadelphia mayor whose political base is in the city, to veto the bill, which lobbyists for the telecommunications industry helped draft. Rendell had until midnight Tuesday to veto the bill, or it would have become law without his signature.

Even with a deal between Philadelphia and Verizon, the legislation will leave every other Pennsylvania city and town subject to a provision that gives the local phone company right of first refusal before they can move forward with any plans to provide municipal Internet.

Details of the Philadelphia agreement weren't immediately available, but both sides said the deal would guarantee that Verizon waives its right under the legislation to bar the city from providing the service for a fee.

"We would waive our right of first refusal," said Sharon Shaffer, a Verizon spokeswoman. Verizon's concession to Philadelphia was motivated by its desire to see the legislation signed, she said.

The provision is tucked into a larger, 30-page bill that would give telephone companies financial incentives to quicken the rollout of broadband networks. The incentives could be worth as much as $3 billion to Verizon.

Dianah Neff, the city's chief information officer who is overseeing the wireless project, said the governor's office had asked last week that Verizon and the city settle its differences over the bill.

Under the legislation, any "political subdivision," such as a city, after Jan. 1, 2006, would have to get the permission of the local telephone company to provide a telecommunications service for a fee, including broadband. If the company rejects the plan, it would have to offer a similar service within 14 months.


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