Under the agreement, Sacramento residents would pay monthly subscription fees of about $20 to use MobilePro’s wireless service, local businesses would pay $90 to $250, and Sacramento’s city agencies would be able to use the service free. The agreement resembled that of many other municipal wireless deals across the country. For MobilePro, based in Bethesda, Md., a full year of service would bring in $2 million to $4 million in revenue, analysts estimate.
But earlier this month, the deal fell apart. The reason: Sacramento city officials had noticed new municipal wireless deals inked in San Francisco and Portland, Ore. The Portland rollout, sponsored by Silicon Valley startup MetroFi Inc., and the San Francisco deployment from Google Inc. and Earthlink Inc., both offered wireless service to those cities with expanded free access for some businesses and residents. Instead of relying on user subscription fees, MetroFi, Google and Earthlink planned to make money off local advertising that would be embedded in their wireless service.