Low ad revenue estimates force Metra to delay Wi-Fi study
BY TINA SFONDELES Staff Reporter May 17, 2013 12:14PM
A Metra train in Blue Island. | Joseph P. Meier~Sun-Times Media files
Updated: June 19, 2013 6:11AM
Metra is delaying the second phase of a plan to get Wi-Fi on trains amid concern the rail agency wouldn’t get enough from advertising dollars and would still have to spend millions annually.
An analysis presented to the Metra board Friday estimated it would cost $33.5 million to institute Wi-Fi systemwide for a year — and $71.7 million over five years — a cost Metra had hoped to cut with revenue from ads and sponsorships. Part two of the study would involve putting out a bid for proposals from vendors.
But Monica Paolini of Xentran, a consultant assisting Metra with the Wi-Fi study, told the board Friday that estimated ad revenues would mean that — at best — Metra would still have to pay 50 percent of the program’s annual costs.
“Fifty percent [from advertising] we’re looking at no matter what we do, that’s 30 some million dollars” over five years, Metra Chairman Brad O’Halloran said. “So we can put out RFPs [proposals for bid] til the cows come home but we’re going to be paying a lot of money to institute this systemwide.”
Amtrak successfully added Wi-Fi to its trains, Paolini said, but paid for it by increasing ticket prices.
Board directors discussed the issue in heated exchanges that spanned more than 30 minutes before voting to delay the $130,000 second phase, which would have allowed companies to offer bids.
Metra board member Jack Schaffer said he was “reluctant to slam the door in their [passenger] faces.” Still, he suggested requesting help from Springfield for funding before going forward.
“I can’t recommend spending another penny on this,” board member Mike McCoy said.