It didn’t seem that long ago that municipal Wi-Fi was all the rage as cities across North America scramble to roll out free or low-cost networks as an alternative to high-speed service offered by carriers and cablecos.

Today, the municipal Wi-Fi market appears to be, at best, a major disappointment. Chicago, for example, just decided to retreat from offering Wi-Fi service after failing to strike a deal with EarthLink or AT&T. In San Francisco, the city’s dream of a free Wi-Fi network has evaporated after EarthLink backed away from a plan. And here in Toronto, Toronto Hydro’s One Zone service has struggled to attract subscribers due to spotty coverage and a small network footprint.

So what’s gone wrong? In theory, a municipal Wi-Fi network should thrive given people want to be connected at any/all times. If done properly, Wi-Fi can become an important element of a city’s competitive plan to attract business while providing local citizens with an essential new economy tool.

The problem may be unrealistic expectations. It was assumed that municipal Wi-Fi was going to be a lot like broadband service with the same kind of reliability and speed. For the most part, this hasn’t happened so people have been disappointed and, as a result, municipal Wi-Fi has failed to gain much marketing momentum.

Maybe the issue is price. If Wi-Fi was free or super-cheat perhaps people would be happier with it. Of course, revenue – or the lack thereof – is one of the reasons why EarthLink has lost its enthusiasm for Wi-Fi.

Another issue may be that Wi-Fi technology just isn’t good enough, which I’m sure will rub a bunch of equipment makers the wrong way. Look at this way; offering wireless service in a major city is a huge challenge. To provide proper and reliable coverage, you need to have an awful lot of base stations, and even then you’ll probably have issues with buildings and line of site.

This is why there’s growing interest in Wi-Max as a way to effectively offer municipal wireless service. It may be that Wi-Max is the right technology, and that Wi-Fi’s best use is within the home and places such as hotels and cafes to serve the needs of customers.

In any event, I’m going to be speaking with Toronto Hydro Telecom president Dave Dobbin soon so look for another post on the future of municipal Wi-Fi. I’m sure Dobbin will provide an effective counter-argument.

For more thoughts, check out Ars Technica, which suggest cities would do themselves a favour by starting small as opposed to trying to provide city-wide coverage out of the gate. In summing up municipal Wi-Fi’s troubles, IP Democracy’s Cynthia Brumfield puts a nice (and smart) spin on things: “So, Wi-Fi, while very cool at Starbucks and around airport gates, just doesn’t pass the laugh test for a major metropolitan communications system.”

First, the good news: I got a Blackberry 8800 yesterday – slick design, GPS-enabled…very cool, although it is odd that the 8800 doesn’t come with a camera, while the Curve doesn’t come with GPS.

Getting the Blackberry, however, was a painful experience. Perhaps the first mistake was actually going to a Rogers store, which seemed like a good idea given you will get, in theory, good customer service. And the salesman was very helpful and diligent; going over our corporate plan, explaining the different service options, etc. All in all, it was top-notch customer service that you would expect when shelling out several hundred dollars.

Unfortunately, the process took about 45 minutes as the sales guy gathered a bunch of information, punched it into the computer, etc. All this while, we had to stand at the sales counter because there’s no chairs or tables in the store. Maybe not having tables and chairs lets the store maximize its expensive downtown real estate, or maybe it stops people from just hanging out (although why anyone would want to hang out at a Rogers store is beyond me!).

When everything was completed, I’m not sure whether I was happier about getting the Blackberry or finally being able to get back to the office so I could sit down.