Caltrain Wi-Fi project delays: what is the model for Wi-Fi on public transport?

Caltrain rejected two bids for its project to deploy Wi-Fi connectivity on trains between San Francisco and San Jose, according to the San Mateo Daily Journal. Caltrain says one bid was too expensive and the other too restrictive.

According to the San Mateo article, one of the bidders (Nomad Digital from Newcastle, UK) asked Caltrain to make a significant investment in the deployment of the network. Caltrain balked at the proposal because it was too costly. They are using grant money to provide Wi-Fi on the SJ-SF line. Caltrain really wants to provide Wi-Fi service to its passengers, but just couldn’t get enough grant money to pay for the costs of deployment.

A year ago, Caltrain began a trial (Glenn Fleishman writes that Caltrain spent $300,000) with Nomad Digital, Sensoria and Intel Solution Services. The trial generated a lot of interest among Silicon Valley commuters. Many have said that they and their employers would gladly pay for Wi-Fi service so that they could work on the trains to and from the office. Of all places, you would think that the San Francisco – San Jose railway network is where Wi-Fi service will pay off immediately. Before you come to the conclusion that Wi-Fi on public transport is dead, look first at what’s going on in Europe.

In Europe, many railway operators have had Wi-Fi for internal use in train depots, stations, and other facilities for many years. Now they are rolling out Wi-Fi service to passengers. France’s high speed rail operator announced that it will offer Wi-Fi service on the Thalys trains from Paris to Brussels and Amsterdam. My sources tell me that the French are also deploying Wi-Fi on the recently launched TGV Est (Paris to Frankfurt). TGV Est recently broke speed records, going 574 kilometers per hour (356 mph). Other operators in Europe have been offering Wi-Fi service for more than a year (e.g. GNER).

What accounts for the differences between US and European rail operators in their Wi-Fi strategy? To find out, I talked to Xavier Aubry, CEO of Appear Networks, a Swedish company that works on a lot of European railway Wi-Fi projects. Among their clients are the Nederlandse Spoorwegen (NS — the Dutch railway operator), SNCF (French railway operator) and the Stockholm subway. Appear builds “middleware” — the software links the network to the end user device (e.g. iPAQs used by railway employees). The software collects data from central servers, analyzes them, and decides what to do with them — which information to present to the end user on his device and how to present it. Many of the people who use these devices are railway employees, not geeks, and they don’t want to waste time configuring their devices. They just want to get their work done.

Below is the Q&A with Xavier.

(1) Why are European railway operators going ahead with plans to put Wi-Fi in trains? Is the model in Europe is different? Which railways are deploying Wi-Fi?

There are many European operators who are deploying and planning to deploy Wi-Fi on board trains (NSB in Norway, SNCF in France, NS in the Netherlands, SJ in Sweden, ??±BB in Austria). By contrast, most US initiatives have been very slow to take off. I believe this can be explained by the following reasons:

(a) Structural differences between European and US public transport authorities (PTAs): European PTAs are willing to invest in new services because they are more profitable than their US counterparts (who are still struggling to compete with cars). The percentage of people who ride trains in Europe is significantly higher than that in the US. European railway companies are very large enterprises that generate a lot of revenue every year. They compete with airlines that offer “cityhopper” services (Paris-Amsterdam, Paris-Frankfurt, Paris-Marseille, for example).

(b) Lack of technology ecosystem in the US: The only end-to-end Wi-Fi connectivity solution in the US was provided by PointShot Wireless (Canada), which has gone out of business. In Europe, there’s an ecosystem of companies such as Appear, Icomera, and Nomad Digital. In addition, large systems integrators such as CapGemini and IBM have developed strong public transport mobility solutions practices in their European offices.

(c) Better business models: European operators have a “business to enterprise” (B2E) model to provide mobile applications to their staff in addition to the “business to consumer” (B2C) models that provide paying ad-sponsored entertainment to their passengers. US operators are still stuck with one form of B2C — delivering Internet access to their passengers’ laptops.

(2) Could you elaborate more on the B2E and B2C models followed by the European operators?

(a) B2E: European railway operators use Wi-Fi to update on-board systems and employee handheld devices with information, such as speed limits, problems on trajectories, travel planning, etc. EU regulations now require instant updating of information when trains cross borders (backhaul used is a combination of UMTS and WiMAX). Thus, European firms use Wi-Fi intensively to make employees more productive and to share critical information within the enterprise.

(b) European operators deliver not just Internet access, but also services: US rail operators focus on giving their customers Internet and email access only. European operators want to deliver not just Internet access, but also video on trains (similar to those in airports). There will be servers in the trains that transmit (via Wi-Fi) video and text information to on-board TV screens and to Wi-Fi devices that can play video.

In the future, they can even stream video and music to passengers’ own devices from the train’s server. Operators in Europe are thinking more along the lines of airports and there are content providers who would be willing to pay to have their content delivered to passengers in a captive space. This could generate an extra revenue stream for the operators.

(3) Who is paying for the deployment of Wi-Fi in trains?

In Europe, the operators are paying, never the suppliers, because of the B2E and B2C models. The Dutch railway operator, NS, figures that the efficiency and productivity gains pay for the network even if they never offer Wi-Fi access to the public. NS has already equipped its employees with over 10,000 iPAQs using the Appear IQ client for the synchronization over Wi-Fi and their Railpocket application.

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My observations:

(1) The European railway operators’ drive to “automate everything” may have something to do with the cost of labor in Europe.

(2) I spoke to George Cameron, Caltrain’s chief admin officer, who told me that Caltrain still plans to deploy Wi-Fi for its employees and passengers but that the network will be part of an overhaul of Caltrain. They are upgrading the line itself so for them it makes more sense if they install the network during or after the overhaul.

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It’s difficult to compare the deployment of Wi-Fi on trains in the US (and in particular in California) with that in Europe because European operators are large enterprises that generate much more revenue than their US counterparts. Europeans use trains much more than Americans. Because of this, European operators have more money to invest in communications infrastructure (Wi-Fi on board trains and UMTS/WiMAX for backhaul) for internal use and for their passengers. I could see East Coast train operators following the European model because public transport is much more popular there than in California.


  1. Rail Canada offers Wi-Fi in business class for an extra fee

    Unfortunately, here on the East Coast where it would be a great consumer benefit on the commuter up and down the Washington-New York-Boston corridor, it doesn’t seem to be available. Amtrak isn’t advertising it.

  2. Frederick Laurice says

    I heard that T-Mobile has already deployed Strix gear for Amtrak and the size of the installation is apparently going to be 400 or so miles covering the Washington-New York-Boston corridor, but I have not been able to find this information published.