New York City is converting obsolete payphones into a mega-fast municipal Wi-Fi network -- and ads are funding the whole thing.
City officials joined representatives from tech firms Titan, Control Group and Qualcomm today to announce the LinkNYC program, which will transform up to 10,000 payphones into what was called "the fastest and largest free municipal Wi-Fi deployment in the world." The new link could offer speeds of up to 200 times faster than some LTE connections, to millions of people every day without charges or data limits.
"It will revolutionize how advertising is delivered in the most important market," said Scott Goldsmith, chief commercial officer at Titan, an an out-of-home advertising firm. "This program will change the lives of all New Yorkers."
Titan will sell ads for the digital displays on the sides of the physical "Links" – the physical hubs for the network. The revenue will fund construction and upkeep while generating $500 million for the city over 12 years, according to the announcement.
"We think advertising revenue will be astonishingly large – billions of dollars," Mr. Goldsmith said.
Technology and design company Control Group will oversee the user experience, while mobile specialist Qualcomm will be in charge of the hardware. Along with tech designer Comark, the companies form the core of CityBridge, the public-private consortium that will run the Links for the city along with the NYC Mayor's Office of Technology and Innovation and the Department of Information Technology and Telecommunications.
There will be two 55-inch digital displays on each Link, and the ads' digital nature will allow them to be more flexible and profitable than the current print ads that support payphones, according to CityBridge.
The first 500 Links are expected to appear at the end of next year, with up to 10,000 Links appearing in all five boroughs over the four years after that. The Links will also offer free phone calls to anywhere in the U.S., a charging station for mobile devices, a tablet that can connect users with city services and directions and the ability to push out public service and emergency announcements.
$142.5B 2015 U.S. ad spending for 200 LNA
The effective radius of the Wi-Fi network is expected to be 150 feet.
The participants said that there were currently no plans to use beacons, which enable mobile devices to deliver location-specific ads to consumers. The targeting is extremely valuable for advertisers, but the revelation that Titan had placed beacons in payphones caused an uproar last month and prompted the city to order them removed based on privacy concerns.
The Links will deliver "aggregated, anonymized" data to the city's Open Data portal, but the CityBridge representatives promised privacy to individual users.
"We will never share personally identifiable info with third parties for their own uses," said Colin O'Donnell, founding partner of Control group, although he did not rule out uses by law enforcement. "We take privacy very seriously."
Kiva Allgood, senior director-business development at Qualcomm, stressed that the ads would be crucial to the success of the LinkNYC, with many municipal Wi-Fi projects having failed to deliver key promises. "Many have failed because they didn't have an ongoing revenue stream to keep it up," Ms. Allgood said.