LinkNYC Owes City $70M, Lags in Kiosk Expansions

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LinkNYC was the central tech initiative by Mayor Bill de Blasio to replace thousands of pay phones with fast and free public Wi-Fi kiosks and emergency calling throughout the five boroughs. Photo Credit: link.nyc

By: Hadassa Kalatizadeh

LinkNYC was the central tech initiative by Mayor Bill de Blasio to replace thousands of pay phones with fast and free public Wi-Fi kiosks and emergency calling throughout the five boroughs. A recent audit from state Comptroller Thomas DiNapoli has found the project failed to live up to its objectives.

As reported by Crain’s NY, the audit found that LinkNYC operators are $70 million behind on payments to the city and missed deadlines to expand into underserved neighborhoods. The Wi-Fi kiosks are funded through video screens used for advertising and public announcements. The project’s private operator, a group of tech companies known as CityBridge has failed to make revenue-sharing payments from digital ad sales. The audit is also blaming the city for lack of oversight. “New York City’s underserved neighborhoods need broadband connection, but the LinkNYC program has not succeeded largely because the city has not held its developers accountable,” DiNapoli said in a press statement relaying the audit.

As per Crain’s, LinkNYC was supposed to have 3,100 kiosks throughout the five boroughs by July 2020. It has only reached 60% of that goal. Also most of the existing kiosks have been placed in Manhattan, whereas over 70% of ZIP codes in Queens and Staten Island do not have any LinkNYC kiosks at all. The audit also found that upon inspections of 225 LinkNYC kiosks in a 24-hour span, about 75% of the kiosks were damaged or dirty. The comptroller’s recommendations included that the city: collect the money it is owed from LinkNYC’s operator, require the operator to add more kiosks outside Manhattan, and increase inspections of existing kiosks.

Department of Information Technology and Telecommunications Deputy Commissioner Janine Gilbert gave a response within the audit, saying that the department is already restructuring the deal with LinkNYC. The renegotiated deal will rely on revenue from hosting 5G equipment, as well as ad revenue, to fund the expansion of LinkNYC. The original deal used “wildly unrealistic” assumptions about how much advertising money LinkNYC would generate, DOITT Commissioner Jessica Tisch said earlier this year. The amended agreement, finalized over the summer, will have CityBridge pay back the revenue-sharing owed from previous years, but the city will agree to cut the future revenue-sharing values. DOITT spokeswoman Robin Levine added that the revised contract has already been approved by the city’s Franchise and Concession Review Committee.

Nick Colvin, CEO of CityBridge, said, the deal “significantly advances the city’s capacity to roll out 5G and provides the city with tens of millions of dollars in revenue, including repayment of past fees”.