SAN FRANCISCO – Google Inc.'s (GOOG) bid to blanket San Francisco with a free wireless Internet service cleared a major hurdle Wednesday when a city panel identified the search leader and EarthLink Inc. (ELNK) as the best candidates for the ambitious project.
The recommendation, completing a six-week review, allows the city to begin negotiations with Google and EarthLink, which decided to team together earlier this year after initially bidding against each other.
The companies will pay to build the entire network, which is expected to cost at least $15 million.
EarthLink envisions charging roughly $20 per month for the ability to surf the Web at speeds four to five times faster than Google's free service, expected to be financed with a heavy dose of ads.
Either way, the Wi-Fi wireless service would be faster than Internet access over a dial-up modem. The Google component of the service would make San Francisco the largest city in the nation with free Internet access throughout its borders.
Philadelphia, which is larger, is further along in its attempt to provide citywide Internet access, but its service — also being provided by EarthLink — is to carry fees. Other big cities trying to build Wi-Fi services include Chicago and Minneapolis.
Atlanta-based EarthLink is taking the lead in the final contract negotiations with San Francisco, but Google's involvement is attracting the most attention.
The project has spurred widespread speculation that Google is secretly planning to build a national Wi-Fi network so more people can go online and view the ads that accounted for most of the company's $1.5 billion profit last year.
Google has said it's only interested in providing free Wi-Fi in San Francisco, where many of its employees live, and about 35 miles to the south in Mountain View, Calif., where the company's headquarters are located.
Google spokeswoman Megan Quinn said the company was thrilled by Wednesday's decision and is eager to launch the free Wi-Fi service.
An EarthLink executive also was in a celebratory mood.
"We look forward to getting started in building a solution that will bring the incredible possibilities to reality," said Donald Berryman, who oversees EarthLink's municipal Wi-Fi efforts.
The joint proposal from EarthLink and Google prevailed over five other finalists: Communication Bridge Global; NextWLAN; Razortooth Communications LLP; MetroFi and SF Metro Connect, a partnership that includes SeaKay, Cisco Systems Inc. (CSCO) and IBM Corp. (IBM).
The city's five-member review panel ranked the EarthLink-Google package as the best deal for San Francisco, followed by MetroFi and the partnership that included Cisco and IBM, said Chris Vein, director of the city's technology department.
Vein will now work out a contract that will address privacy, security and costs for the premium service. Ultimately, San Francisco's Board of Supervisors must approve it.
San Francisco Mayor Gavin Newsom, who first proposed a free Wi-Fi network in October 2004, hopes the service will be operational by year's end.
Newsom believes free Wi-Fi will make San Francisco a more appealing place for businesses and help close the so-called "digital divide" by enabling more low-income households to connect to the Internet more easily.
But unforeseen stumbling blocks during the final negotiations and approval process could result in delays, said Greg Richardson, a telecommunications consultant who served on the review panel.