December 1, 2004 11:42 AM PST

Philly, Verizon reach accord on city Wi-Fi plan

Pennsylvania's governor has signed closely watched legislation that Philadelphia officials had worried would imperil their plans to provide Wi-Fi service to all city residents.

One section of the complex law says cities and townships "may not provide to the public" any broadband or wireless services if a fee is charged.

But when signing the legislation late Tuesday, Democratic Gov. Ed Rendell said that a last-minute compromise would allow Philadelphia's ambitious mesh network to proceed as planned.

"We will work with other municipalities on projects that they have established or propose to establish in order to ensure that, to the extent that they are now viable, they will also have the opportunity to succeed," Rendell said.

The Republican-authored bill is designed to prevent local governments from using their muscle to elbow aside private companies that otherwise would invest in broadband and wireless services. It was backed by Verizon Communications, the largest telephone company in Pennsylvania.

Details of the compromise remain sketchy. Barbara Grant, director of communications for the Philadelphia mayor's office, said Wednesday that "we have reached an agreement with Verizon, although we're waiting for all the documents to be signed before we go into details."

Verizon spokeswoman Sharon Shaffer said, "Both parties agreed that they would not disclose details nor make a copy (of the agreement) available."

But the governor's office said that Verizon and Philadelphia have reached a deal permitting the citywide project--which is intended to turn 135 square miles of downtown into one huge 802.11b hot spot--to proceed.

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