THE IMPACTS OF WIRELESS CITY PROJECT: THE CASE STUDY OF TAIPEICHAN, Ming-Chang
Taipei City Government and Waseda University

1.

Introduction
In decade, the wireless communications technologies, such as GSM (Global System for Mobile
Communications), Wi-Fi (Wireless Fidelity), 3G (3rd Generation)…etc., are widely used and appliedin our daily life as a critical component of human behaviors in many homes, schools, and businesses.
Nowadays, more and more main cities of the world announced a project to build a “Wireless City,” totransform the Wi-Fi from the hot spot application to the outdoor hot zone coverage, such as
Philadelphia, San Francisco, London, etc.. The Taipei City Government (TCG) of Taiwan also
recognized this wireless phenomenon and made a big step about it from a public perspective. It
initiated the “M-Taipei Initiative” to provide public access to outdoor wireless broadband in scale.
After two-year of efforts, on June 29, 2006, JiWire, the Wi-Fi hotspot directory company, announced
that Taipei City had the largest public Wi-Fi network in the world. This network both covers a larger
area (134 km²) and serves more people (2.32 million, or 90% of Taipei’s population) than any other
cities in the world (TCG, 2006).
Upon the world-wide trend of building the wireless cities, this paper takes the “M-Taipei
Initiative,” the first and largest Wi-Fi network in the world, as a case study to explore the features ofwireless cities, by public resources and data analysis from the city government, in-depth interview ofproject key agents, and participant observation and implement experiences of author himself. It tries
to identify the major issues in this wireless city and evaluated the impacts and consequences of thecase by government surveys and research reports. Finally, we hope this study will provide the firsthand pilot experience to other municipalities that followed the trend to achieve the beautiful goal ofwireless city in this information age.

2.

Highlights of the M-Taipei Initiative

2.1 Technology Background and Its Vision
Among the developed countries, Japan is perhaps the most successful country in developing
mobile services. More than 70% of its cell phone users can access the web wirelessly. Moreover,
the technology to offer the wireless services is the upgrade from Personal Handy-phone System (PHS)to the 3G. However, in Taiwan, the most common wireless transmission technologies fortelecommunication are GSM (2G). The 3G entered the Taiwan telecommunication market much later
than some developed countries in Asia in the second half of 2005. It’s a brand-new mobile service
for Taiwanese still being promoted by local cell phone operators at present. Thus, the 3G mobile
communication technologies and markets are still not expected well performance in Taiwan on timeand it turns out many operators have opted to provide hot spot services. This has resulted in a
gradual shift from broadband internet access (such as xDSL) to the use of wireless access points (APs),a large number of which are installed in schools, office buildings, coffee shops, etc.. With 802.11g
may reach a speed of 54mb/sec, ten times faster than the current 3G cell phones, Wireless Local Area
Network (WLAN) become excellent alternatives for Taiwan.
Based on this telecommunication environment and Taiwan is the world’s largest wirelessequipment manufacturer, there are still increasing numbers of firms participating in the developmentof wireless devices through rapid advancements in wireless network application techniques, toimprove information infrastructure, the TCG launched the "M-Taipei Initiative” in February, 2004.
The main vision of the M-Taipei initiative is to upgrade the city’s information infrastructure and topromote a public wireless area network. The plan is that the city government provides its
public-owned resources and entrusts the private sector to do the installation and operation to offer acity-wide “hot zone” instead of unconnected local “hot spots.” It has to offer city residents wirelessaccess to the internet and to the convenient citizen services provided by TCG. The project is1

envisioned to make Taipei City the world’s first wireless metropolis and to reach the ultimate goal of“Wireless Taipei: The Unfettered City.” The detail goals of project are identified on Figure 1 as
below.
Figure 1.

The goals of M-Taipei Initiative

Citizen's lifestyle network: To roam freely on the internet
anywhere, anytime, satisfying business and daily needs.

Future Visions
Social needs•solve the last mile•bridge the digital divide
Political needs

Economic needs•mayor’s achievement•m-commerce•devices & application

Wireless infrastructure•m-government

Private use

Public use

Source: summarized by this research, 2007
2.2 Project Implementation
The overall Initiative was divided into two main stages. Stage 1 involved retaining
Hewlett-Packard Corp. (HP) as technological consultant and the selection of a private company for theconstruction and operation. The City Government entrusted Q-ware Corp. to install and operate thepublic wireless network covering the whole city. Q-ware is a subsidiary of Uni-President Group,
who is a big business group and also the parent company of 7-11 and Starbucks in Taiwan. Stage 2
involved infrastructure installation and network operation. According to the B&O (Build and Operate)
contract among two parties, Q-ware was to build the network, Taipei City neither spending any money
nor transferring ownership of any properties. The major phases of project planning and implement
can be described in Table 1.

StagesTime Period
Procedure

Table 1. The major stages and events in M-Taipei Initiative
Selection
Project
Construction Phase
process
implementation
2004.022004.08
2004.09
Selection of The government 1) On February 1, 2005, Phase I of
infrastructure installation was
consultative approved
completed, covering 30 Taipei
team.
Q-ware Corp.,
Metro (subway) stations, andwhich beat out
bringing service to 20% of Taipei’sanother local
population; WIFLY, the brand ofcompany inwireless network service, made its
bidding.
debut.
2) On December 12, 2005, Phase 2
was completed, expanding
coverage to 28.2 km² and 50% of
Taipei’s population.
3) On September 5, 2006, installation2

Operation
2006.01
1) A total of 55,000
people registered forthe free trial of
WIFLY service thatran between January2005 and January
2006.
2) As of the end of May
2007, more than
150,000 people hadsigned up for
WIFLY, and thenumber ofImportant
EventsHP Corp.
was theselected
consultantof theproject on
May 7,
2004.

FuturexDevelopment

The plan’scontract was
signed on
September 7
2004.

x

was finished, and about 4,000 APs
were in place, covering 134 km²
and 90% of Taipei’s population.
The city leased access to public
facilities (such as power posts, street
lights, and publicly-owned buildings)
to Q-ware for nine years with one stop
window.
1) To negotiate with the state-owned
power company to supply 24-hour
power for APs.
2) Use trimming or chopping down
trees to make signals clearer.
Maintaining and keep on increasing
more APs for the well-service.

subscribers was
rising steadily eachmonth.
Public and commercial
marketing activities forpromoting.

More public contents andbusiness applications on
it.1
Source: TCG and the Q-ware Corp., summarized by this research, 20073.

Research Findings
Based on the characteristics of the case, we figured out the M-Taipei Initiative in three peculiar
findings. There is Public-Private Partnership (PPP) in this BO approach, business model (triangularelements: wireless infrastructure, killer devices, and content services) in this network, and its impacts
on politics, city marketing, and the usages in the city.
3.1 Public-Private Partnership (PPP)The term “New Public Management (NPM)” was coined because some generic label seemed tobe needed for a general, though certainly not universal, shift in public management styles (Hood,
1990). The NPM reforms occur prior to the technological changes; so it is risky to the public sector
to tender a BO project in a long period because of the uncertainty inherent in technology, finance andthe complex interaction of the project scheme. This study discusses the PPP through the interaction(key activities) in the BO scheme (as Table 2).
Table 2.
Stages

The interaction between public and private sectors in BO scheme

Selection process

Project

Construction Phase

Operation

implementation
Public sector

Public initiative

Empower

Provide publicMarketing guidance

facilities
Key activity
negotiation

concessionaire

co-ordination

start getting revenues

Be an appropriate

Active participation

Build infrastructureManagement /PrivatesectoragencyLeading1

PublicMaintenancePublicPublic and Private

Public and Private

Nowadays, there are four major public applications in trial: In conjunction with the Taipei City Dynamic Bus
Information System, In conjunction with the Schoolchildren RFID Personal Safety System, In conjunction withthe telemedicine system, and In conjunction with the Taipei City Culture Express Monthly.

3

Role
Source: summarized by this research, 2007
3.2 Business Model
Due to the dissimilar technological standards, Wi-Fi is not interoperable with the 2G and 3G
mobile systems and seemingly fails to share the latter’s network effects. That is, mandated
interconnection alone cannot constitute the WLAN’s installed base.
There are few more steps must be taken into action to ensure the formation of the Wi-Fi network.
Indeed, the concept network effects is not applicable to only the analysis of competition between two(or more) networks but also the one of bundling heterogeneous yet compatible services (Shy,
2001:137). In other words, M-Taipei Initiative must be able to ally (interconnect) with othernetworked goods/services, not necessarily information/telecommunications ones, so that theinterconnection generates heterogeneous network effects larger enough to compensate consumers’switching costs to draw their subscription of wireless access services.
Taipei’s strategy is then to make its Wi-Fi network more compatible with the products andservices in its downstream market or in other industries. Its downstream products include end-user
handheld devices and content services, and the potential heterogeneous alliance includes the fixed-line
telecommunication network, the public transportation system, the payment scheme, and theconvenience-store chain. Thus, wireless infrastructure, devices, and content services form a triangle
as the “eco-system” of wireless city to capture the symbiotic essence in between (Chou, 2005). It isvery unlikely that the Wi-Fi network can grow alone without the development of ancillary handsets
and content services. Figure 2 portrays this triangular relationship of the M-Taipei Initiative.
Figure 2. The Triangular Relationship of M-Taipei for business model
Hand-held
Content
devices

Infrastructure
Source: summarized by this research, 2007
3.3 Social Impacts
1) Politics
According to an article published on April 18, 2006 in the Times Weekly Magazine (1469th
Issue), the M-Taipei Initiative was ranked No. 2 among Top 20 items on the list of citizens’ mostsatisfied city administration achievements in Mayor Ma Ying-jeou’s administration (No.1 is theEasy-Card service). It reported that although the service is not for free, it brings a lot of convenienceby allowing Internet access wireless in the most area of Taipei. Because the M-Taipei Initiative is themost important policy for the mayor, this report shows that it did help a lot for Mayor Ma’s political
position, either domestic or international2.
2) International city marketing
In addition to increase mayor’s achievement, M-Taipei Initiative also helps a lot on internationalrecognitions for city marketing. These accomplishments show on a lot of international news reportson the project and many visiting groups come to Taipei to make a lessen from Malaysia, Singapore,
Korea, Japan, French, America, etc.. Taipei City never catch so much eyes in a international scale
without the M-Taipei Initiative, expect for the highest skyscraper, Taipei 101. In 2003, and again, in
2

After serving as the mayor of Taipei City, Mr. Ma Ying-jeou now is running for the 2008 selection of Taiwan’s
President for his political career.

4

2005, the city was chosen as one of the world’s seven intelligent communities by the Intelligent
Community Forum (ICF). In 2006, Taipei City bested other world cities to win the Intelligent
Community Awards. The reason Taipei wins was mostly due to the M-Taipei Initiative. It also
proves that “through the efficient execution of a sound information technology policy, a small city cansurpass a large city and a small nation can excel a large nation.”
3) ICT Usage
Based on TCG’s annual report, we can tell there are just a little significant changes on ICT usageof Taipei’s citizens as Table 3 below.

Facts onICT
Usage of
TaipeiTable 3. The Facts on ICT usage of Taipei
before 2004
2004-2006 (Project Implementation)
1)Households /1)Households /Connected to broadband: 77.4%
Connected to broadband: 69%
Internet penetration rate: 88.2%
Internet penetration rate: 83.6%
2)Individual /2)Individual /Wireless needs: 29%
Wireless needs: 27%
Wireless usage: 36.6%
Wireless usage: 18.9%
Wireless campus coverage rate:
Wireless campus coverage rate:
100% in 280 schools
20% in 280 schools(Oct. 2006 Survey)(Sep. 2004 Survey)
Source: Taipei City Government, 2007

After project implementation, the wireless usage of citizens in Taipei is highly increased from
18.9% to 36.6%. At the same time, the wireless needs of citizens is not change a lot like the usage,
which means, the wireless city project didn’t truly satisfy citizens’ need on mobile service or create
new needs to communicate. Nevertheless, the project is related to the information policy so its
promotion is also good for the wholes development of broadband connection and the Internet
penetration in Taipei.

4. Conclusion
According to the research findings, it shows in Taipei’s case, wireless city project has a complex
PPP and relays on the triangular elements to form a well-done service in the future. So far, it justmade a positive impact on city marketing and Mayor’s political achievement. For researching the
project vision and make roaming wirelessly on the internet anywhere and anytime, satisfying businessand daily needs, it’s still a long way to go.
However, M-Taipei Initiative is a nine-year project. It still has a lot of uncertain factors to affectthe city during the operation, such as party alternation of city mayor, Q-ware Corp. was sold to the Far
Eastone Telecommunication Corp. which is one of Taiwan’s top three telecom company, and the new
wireless technology is spring up and takes over the main position in the market, especially the
WiMAX (Worldwide Interoperability for Microwave Access) we look forward. Thus, this paper still
provides a preliminary exploration on wireless city project for other countries or cities.

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