Lessons from Japan’s municipal Wi-Fi projects
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Presentation at the 21st ITS Biennial Conference in Taipei (July 29, 2016)
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Lessons from Japan’s municipal Wi-Fi projects
- 2. Purpose and agenda Recently in Japan, many municipal governments have been working hard to install municipal Wi-Fi systems. The purposes of this study are to focus on the four most important issues in the Japanese muni Wi-Fi projects, analyze them mostly from an economic perspecYve, and propose a workable plan for (or a direcYon in which we should look for) soluYons. T. JITSUZUMI@2016 ITS Taiwan (Taipei, ROC, June 26–29, 2016) 2 Agenda 1. Muni Wi-Fi and digital divide 2. Japan’s unique situaYon 3. Issues on the table I. Economic jusYficaYon II. Security and traceability III. Neutrality concern IV. Disaster response 4. Summary and policy recommendaYons
- 3. Mini Wi-Fi as a tool to close a digital divide As more and more socioeconomic acYviYes are becoming possible in cyberspace, many governments have started to realize that broadband access is a necessity for boosYng economic acYvity. ◦ According to the analysis of the World Bank (2009), every 10% increase in broadband subscripYon can generate 1.21% growth of GDP for high-income countries and 1.38% growth for low- and middle- income countries. T. JITSUZUMI@2016 ITS Taiwan (Taipei, ROC, June 26–29, 2016) 3 “Digital divide, mobile BB Wireline broadband in the US Because of the posiYve externality of such broadband deployment, direct involvement by public bodies has long been considered appropriate and necessary. Wireless technology provides an efficient opYon in fulfilling such needs. ◦ It can minimize costly civil engineering. ◦ AddiYonally, it can eliminate the cost and Yme needed to obtain a spectrum license. Source: hip://www.adweek.com/ socialYmes/files/2014/11/wifi.jpg
- 4. Japan’s moYvaYon is different T. JITSUZUMI@2016 ITS Taiwan (Taipei, ROC, June 26–29, 2016) 4 Source: hip://todo-ran.com/t/kiji/10775 Broadband contracts per 100 inhabitants In Japan, ubiquitous broadband availability was achieved in 2010, thanks to the efforts of private carriers and the MIC. The objecYves of muni Wi-Fi are, in most cases; a) to improve Japan’s value as an inbound tourist desYnaYon, b) upgrade its preparedness for natural disasters, and/or c) improve the efficiency and quality of municipal operaYons. 100% • 99.2% for fixed 100% • 99.7% for fixed 100% • 99.8% for fixed 100% • 99.9% for fixed 100% • 99.9% for fixed 92.7% 97.3% • 96.5% for fixed 99.4% • 97.5% for fixed 99.9% • 98.7% for fixed 99.98% • 99.0% for fixed FTTH, cable (≧ 30 Mbps), FWA (≧ 30 Mbps), BWA(≧ 30 Mbps), LTE FTTH, cable, FWA, satellite, BWA, LTE, 3.5G Mar. 2011 Mar. 2012 Mar. 2013 Mar. 2014 Mar. 2015 Source: Created by author from data in http://www.soumu.go.jp/main_content/000371278.pdf
- 5. Unfulfilled Wi-Fi demand of inbound tourists 20.0% 21.5% 49.3% 42.7% 45.5% 70.4% 0% 20% 40% 60% 80% 100% Singapore Korea France U.K. U.S. Japan Use of free public Wi-Fi at public or tourist faciliYes Always Usually SomeYmes Rarely Never T. JITSUZUMI@2016 ITS Taiwan (Taipei, ROC, June 26–29, 2016) 5 Source: Created by author from data in MIC (2014) According to the JTA’s survey (Oct. 2011): ◦ Among foreign tourists who visited tourist informaYon centers, 36.7% experienced trouble in accessing free public Wi-Fi. ◦ The most requested informaYon at tourist informaYon centers is the one related to free public Wi-Fi. ◦ The situaYon was similar for foreign tourists who did not visit tourist informaYon centers: 32.2% experienced trouble in accessing free public Wi-Fi. And informaYon related to free public Wi-Fi was in great demand.
- 6. These are in line with the agenda of the naYonal government, which emphasizes the importance of the tourism industry—especially in anYcipaYon of the coming Tokyo Olympics in 2020—and of being prepared for the next great earthquake. Policies that promote free public Wi-Fi in Japan T. JITSUZUMI@2016 ITS Taiwan (Taipei, ROC, June 26–29, 2016) 6 Japan RevitalizaYon Strategy [Revised in 2014] (pp. 84–85) 4) Preparing of the free public wireless LAN environment as infrastructure for new innovaYons Source: Extracted/translated from hips://www.kantei.go.jp/jp/ singi/keizaisaisei/pdf/honbunEN.pdf, hips://www.kantei.go.jp/jp/singi/keizaisaisei/pdf/dai2_3en.pdf, hip://japan.kantei.go.jp/policy/it/20140624_decraYon.pdf, and hip://www.mlit.go.jp/common/001046636.pdf Japan RevitalizaYon Strategy [Revised in 2015] (pp. 82–83) [3] PromoYng the development of free public wireless LAN environments throughout Japan DeclaraYon to be the World’s Most Advanced IT NaYon [Revised on June 24, 2014] (p. 16) (6) PresenYng “Omotenashi” using most advanced IT at the opportunity of Tokyo Olympics and Paralympics, 2020 and the like. AcYon Program toward the RealizaYon of Japan as a Tourism-oriented Country (Jun. 17, 2014) (extracted from p. 23 and p. 26) 5. Improvement of inbound tourist accommodaYon (2) Improvement of communicaYons condiYon for inbound tourists, such as free public wireless LAN Policy papers 1. “Disaster-PrevenYon InformaYon StaYon” Improvement Project (FY2013) 2. “Tourism-oriented” and “disaster-prevenYon” Wi-Fi staYons Improvement Project (FY2014-) 3. Mobile Phone Coverage Improvement Project (FY 2016) 1. Inbound Tourism FaciliYes Improvement Project ◦ Part of the budget is used to subsidize the installment of hotel Wi-Fi, airport Wi-Fi, and staYon Wi-Fi. Subsidies
- 9. Issue #1: Economic jusYficaYon for muni Wi-Fi T. JITSUZUMI@2016 ITS Taiwan (Taipei, ROC, June 26–29, 2016) 9 CAPEX for installing the Wi-Fi Private benefit for the Wi-Fi operator Spillover benefit of the Wi-Fi OPEX for the Wi-Fi Time C A B All the benefits are captured by the operator. Benefits are enjoyed by third parties but can be partially captured through tax. Benefits are enjoyed by third parties and are difficult to be captured. No externality Small externality Large externality Source: Created by author from information in APPLIC (2015) Ordinary times Emergency Targeted users Municipal gov. Local utility providers Local residents/business Tourists Office use Facility monitoring Urban development Community service Service for tourists Backup office network in an emergency Backup internet access Disaster information service Mainly for the pure Internet access Used as an integrated part of a system or applications When the following condition satisfies, this Wi- Fi project is socially worthwhile but cannot be realized due to dynamic externalities. P.V. of B P.V. of C P.V. of A P.V. of B+<< Possible reason for municipal investments On the other hand, if the following condition is met, it must be a “profitable” private project. P.V. of C P.V. of B<
- 10. In the case of Fukuoka City Wi-Fi Fukuoka City Wi-Fi has generated a posiYve returns form the perspecYve of the overall city ◦ According to the esYmaYon made in 2015 by the Nomura Research InsYtute, between 2012 and 2014, the City Wi-Fi airacted 2,584 more inbound tourists and brought JPY124 million of addiYonal consumpYon to the city. ◦ On the other hand, the CAPEX and OPEX of the system in these years was JPY86.4 million. T. JITSUZUMI@2016 ITS Taiwan (Taipei, ROC, June 26–29, 2016) 10 Source: hip://www.soumu.go.jp/main_content/000354251.pdf, hip://canalcity.co.jp/staYc/detail/concept, hip://images.keizai.biz/hakata_keizai/headline/1342146230_photo.jpg, hip://www.yell-tour.com/yt/kys/images/keshiki/fuk/nakaasuyatai.jpg 2012 2013 2014 TOTAL Benefit Increased visitors 585 1,999 2,584 Increased spending 28.07M yen 95.9M yen 123.97M yen Cost 37.1M yen 26M yen 23.3M yen 86.4M yen Net benefit -37.1M yen +2.07M yen +72.6M yen +37.57M yen It seems that benefit figures do not reflect service costs that need to accommodate these increased visitors . Therefore, we have to be very careful in interpreYng this table. Thank you, Prof. Yoo, for your valuable comment.
- 11. Issue #1’: Level of municipal involvement To minimize possible conflicts with private iniYaYves, it would be beneficial to make use of public–private cooperaYon, or public–private partnership (PPP), to expand muni Wi-Fi coverage. ◦ While externality exists and public intervenYon improves efficiency, “it is worthwhile to consider whether a lower level of involvement might offer the benefits of promoYng wider availability of improved broadband access, while imposing a reduced burden on local government resources” (Lehr et al., 2006, pp. 442–443). T. JITSUZUMI@2016 ITS Taiwan (Taipei, ROC, June 26–29, 2016) 11 Two schemes in Fukuoka City Wi-Fi: 1. Installs Wi-Fi routers by city budget 2. Partnership with private facility owners Source: hip://www.applic.or.jp/pdf/futuer_18/03/3-4.pdf Fukuoka City has installed Wi-Fi routers only in city-controlled areas; other places are covered on the basis of individual agreements with facility owners.
- 14. Stricter process of Kyoto Wi-Fi and unanswered quesYons This process was based on an informal negoYaYon between Kyoto City and Kyoto Prefectural Police. Unanswered quesYons include the following: 1. To what degree was usability expected to decline by this new process? ◦ How did they take into consideraYon the impact of declining usability? 2. What kinds of alternaYves were taken into consideraYon? ◦ Did they consult sufficiently with the engineering community? 3. What level of traceability does this process aim to achieve, and in what Ymeframe? T. JITSUZUMI@2016 ITS Taiwan (Taipei, ROC, June 26–29, 2016) 14 Source: hip://kanko.city.kyoto.lg.jp/wifi/en/
- 21. 10 100 1,000 10,000 100,000 10 100 1,000 10,000 100,000 Upload (kbps) Download (kbps) Measured throuputs (normal time) SSID: .FREE_Wi-Fi_PASSPORT SSID: 00000JAPAN SSID: 0002softbank SSID: DoSPOT-FREE SSID: 'freespot'=SecurityPassword(AES) SSID: HANABISHI_FBWIFI SSID: kumamoto-free-wifi SSID: Taketa_Free_WiFi(g) SSID: wifi_square Softbank LTE 10 100 1,000 10,000 100,000 10 100 1,000 10,000 100,000 Upload (kbps) Download (kbps) Measured throuputs (post disaster) SSID: .FREE_Wi-Fi_PASSPORT SSID: 00000JAPAN SSID: 0002softbank SSID: DoSPOT-FREE SSID: 'freespot'=SecurityPassword(AES) SSID: HANABISHI_FBWIFI SSID: kumamoto-free-wifi SSID: Taketa_Free_WiFi(g) SSID: wifi_square Softbank LTE Less concern for the QoS T. JITSUZUMI@2016 ITS Taiwan (Taipei, ROC, June 26–29, 2016) 21 LTE of So•bank Kumamoto Free Wi-Fi 00000JAPAN LTE of So•bank Kumamoto Free Wi-Fi
- 22. ConnecYvity is a concern Post disaster(measured on Apr. 25, 29, and 30; May 8 and 22, 2016) Normal Yme (measured on Jun. 12, 2016) Download (Mbps) Upload (Mbps) Connected % N Download Upload Connected % N Public facility 00000JAPAN 7.05 5.36 100% 36 Free Wi-Fi 19.45 29.29 100% 20 muni Wi-Fi 14.78 26.90 86% 36 So•bank LTE 13.54 5.13 100% 36 Shopping area 00000JAPAN 9.87 10.16 89% 244 1.09 3.27 100% 5 carrier Wi-Fi 9.51 3.31 100% 8 Free Wi-Fi 7.69 9.86 81% 26 5.65 7.66 100% 41 muni Wi-Fi 11.07 5.02 24% 283 2.22 0.28 72% 129 So•bank LTE 28.56 16.35 100% 112 31.13 15.25 100% 27 StaLon 00000JAPAN 6.63 2.12 82% 22 muni Wi-Fi 0% 5 So•bank LTE 15.71 18.32 100% 15 Airport Free Wi-Fi 14.74 14.01 57% 23 muni Wi-Fi 14.36 13.19 89% 27 So•bank LTE 25.92 10.65 100% 12 T. JITSUZUMI, Kyusyu University (jitsuzumi@econ.kyushu-u.ac.jp) 22
- 23. AddiYonal concern for workability 1. Disaster-resistant Wi-Fi is nothing but one of the necessary components of disaster-resistant broadband. 2. The power supply needs to be maintained for every individual handset. 3. PrioriYzaYon control is a must. T. JITSUZUMI@2016 ITS Taiwan (Taipei, ROC, June 26–29, 2016) 23 Source: http://www.mullumwifi.com/images/slide_antennae.jpg Internet cloud Backbone line Earthquake Early Warning Golden 72 Hours After 72 Hours Prioritized flow 1. Information provided to tourists and local residents • On earthquakes • On location of shelters • On traffic flow, etc. 1. First responders’ use 2. Usage of public authorities 3. Usage of NPOs, NGOs, and other volunteer organizations 1. Usage of public authorities 2. Usage of NPOs, NGOs, and other volunteer organizations Best effort Private use Private use Private use Earthquake
- 25. Summary ◦ Since tourism-oriented free Wi-Fi is expected to generate a posiYve externality that can accommodate strong market demand, it will not be difficult to economically jusYfy the municipal iniYaYves. ◦ To realize the potenYal of muni Wi-Fi, we need to reduce the risk involved; however, too much control in this regard may hamper system usability. ◦ The fact that some municipaliYes promote local businesses via their Wi-Fi portal page may raise neutrality concerns. ◦ Almost all muni Wi-Fi spots are designed to provide special services in Ymes of a disaster, but their workability remains uncertain. T. JITSUZUMI@2016 ITS Taiwan (Taipei, ROC, June 26–29, 2016) 25 Ø SYll, to minimize possible conflicts with private iniYaYves, it is important to carefully design public– private partnerships. Ø We need to evaluate the impact of the Kyoto system and determine the best balance between accessibility and control. Ø In order to keep the system neutral, it is important that service providers keep their levels of transparency and accountability as high as possible. Ø It is important to take into account the “actual” workability of muni Wi-Fi systems and prepare a prioriYzaYon plan before the next disaster. Source: hips://wifinowevents.com/europe/wp-content/uploads/CityWiFi.jpg In Japan, where ubiquitous broadband coverage has established, muni Wi-Fi has been introduced mainly for tourism and disaster-prevenYon purposes.