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Benjamin Spillman

Hooking up Las Vegas

10 April 2007

LAS VEGAS, Nevada -- Airliners that touch down in front of Mitchell Gonzalez's front door are loaded with Las Vegas tourists ready to escape the daily grind and connect with Sin City's gambling, eating and partying opportunities.

Gonzalez, president of Cheetah Wireless Technologies, wants to make sure that even amid the haze of casino smoke and din of clanging slot machines the tourists maintain some connection to the outside world, at least as much of it as they can download by laptop computer.

The Brooklyn native who grew up in Puerto Rico is overseeing development of an outdoor wireless network that covers downtown Las Vegas, will soon expand to the Strip and eventually, if Gonzalez plays Cheetah's cards right, could be available throughout the Las Vegas Valley.

On a recent weekday 60 people on the Strip and 35 downtown were logged on to Cheetah's wireless, or Wi-Fi, network. During the International Consumer Electronics Show, there were 505 active accounts. The audience is expected to grow exponentially during the Vegas Grand Prix, which could draw as many as 150,000 fans today through Sunday. Cheetah has agreed to provide free connections during the event, which means anyone with a Wi-Fi-enabled laptop will be able to use the service.

"Vegas is a prime spot for Wi-Fi," said Gonzalez, who got builders of the downtown condominiums Streamline Tower to sponsor the access during the races in exchange for advertising space on the network. "We have so many events in town, we can start taking bids from every major show sponsor."

Cheetah's mesh network covers 95 percent of downtown Las Vegas and 12 percent of the Strip. On June 1, when work crews are scheduled to power up another batch of transmitters on the east side of Las Vegas Boulevard, coverage will extend to about 50 percent of the Strip, generally from the Tropicana to Paris Las Vegas. A third phase scheduled to begin Nov. 1 would cover the entire Strip and reach down Flamingo Avenue to the Palms and Gold Coast.

Transmitters on light poles and rooftops broadcast radio frequencies that allow people to connect to the Internet with service that is fast enough to stream video and download large files.

"There is a big box in our office that I don't know exactly what it does, besides make a little bit of noise," said Eric Ehresman, manager of Main Street Antiques, 500 S. Main St., describing the hardware Cheetah installed at the store.

Ehresman said Cheetah chose the store's rooftop to locate a transmitter because it faces Golden Nugget, approximately 1,900 rooms, and the Plaza, approximately 1,000 rooms.

Besides the box in the office, the store agreed to accommodate the rooftop transmitter and connecting wires.

"They told us what they were going to do, what kind of equipment they were going to put in," Ehresman said."

Software advances have made Wi-Fi transmissions faster and more secure. Hardware improvements enable service providers to send signals through buildings and to the upper floors of hotels or office towers.

"You can deploy this technology in a fairly dense metro area," said Godfrey Chua, a wireless analyst with the Framingham, Mass., research firm IDC.

Chua estimates municipal wireless generates about $88 million annually nationwide but will grow to more than $500 million by 2010.

San Francisco, Philadelphia, Houston and Chicago are among cities taht have explored, and even deployed, the technology.

Much of the appeal is in the cost. Chua said a Wi-Fi network can be deployed quickly through a typical city for as little as $10 million and, unlike cellular or licensed radio channels, the spectrum is free to the provider. That means Wi-Fi providers can offer cheaper and more flexible access than land-based or cellular providers.

One unknown facing Cheetah and other wireless providers in Las Vegas is whether Southern Nevada's massive tourism industry will embrace or resist technology independent providers.

Since the Wi-Fi frequency spectrum is unlicensed, Chua said, hotel operators that see widespread service as a threat could refuse to allow providers to attach transmitters on private property, or even block or interfere with signals.

"Inherently, it does become the Wild Wild West," Chua said.

MGM Mirage already provides land-based or wireless Internet access in most of its 36,000 hotel rooms at 10 Strip properties, a company spokeswoman said.

The resort operator charges $12 a day for access and says it offers more security and options than an outside Wi-Fi provider could supply its guests.

Cheetah's immediate goal, Gonzalez said, is to capture travelers who want a steady, reliable and fast Internet connection throughout their Las Vegas visit. The airport, Las Vegas Convention Center and myriad hotel-casinos now offer pay and free Internet connections. But there isn't a wireless service that covers the entire 25 square-mile area, except for a service cellular phones can buy from their cellular carriers. These services can cost as much as $80 per month.

Cheetah provides access through a tiered price structure that costs $5.99 for an hour, $22.99 for three days and $49.99 for a monthly subscription, with other prices in between.

The company also plans to sell advertising on the network, which could lead to free or low-cost service for customers who don't mind seeing ads.

"Everybody has talked about the advertising model paying for Wi-Fi," Gonzalez said. "The problem is, you can't start that way."

Cheetah, founded in 2002, is operating on $3 million it raised from private investors, Gonzalez said. It aims to raise $5 million more by the end of the year. The company has 11 employees and operates from a suite at 1421 E. Sunset Road, just south of McCarran International Airport.

There are about 3,000 subscribers to the Cheetah network. Gonzalez estimates the company will make a profit once it reaches 3,500 subscriptions, which he expects will occur by June 1.

Both the city of Las Vegas and Clark County have taken notice of Cheetah and other Wi-Fi providers seeking to attach network hardware to government property.

The rise in interest prompted the city and county to hire Alpharetta, Ga.-based consultants Civitium to study the feasibility of providing Wi-Fi coverage throughout the Las Vegas Valley. The study, which cost $117,000, will determine whether the benefit of expanded service outweighs the cost of installation and maintenance. Results are due by the end of May.

Communities that are exploring the technology typically seek to supply wireless providers access to infrastructure to install hardware in exchange for discounts, or even free service, for government workers and citizens.

"If you are going to use my infrastructure, my citizens ought to be getting something for it," said Joseph Marcella, chief information officer for the city of Las Vegas.

If the Civitium study suggests there would be a benefit in providing Wi-Fi throughout the valley, Cheetah could bid against other companies to provide service. One likely scenario is a larger company could win the contract and hire smaller companies, such as Cheetah, to do much of the work.

"You really need someone with a lot of horsepower," Marcella said. "What I am saying is there is room for multiple vendors to blanket the valley."