Philadelphia intends to become the first U.S. city of its size to have wireless broadband access available to everyone, regardless of income, at below-market prices.

TERENCE SMITH: Philadelphia is one of the nation's oldest cities. Its revolutionary roots are on display all over town. Now, Philadelphia intends to join the digital revolution and become one of the nation's most up-to-date cities.

Mayor John Street is the driving force behind Wireless Philadelphia, a project to make the city of brotherly love the first of its size in the nation to have wireless broadband access available to everyone, regardless of income, at below- market prices. The mayor sees it as an essential 21st century utility.

MAYOR JOHN STREET: I believe the day will come when having access to the Internet will be just as common as having water in one's house or having, you know, some form of electricity or some form of heat.

TERENCE SMITH: The city recently announced a deal with Earthlink, an Internet service provider, to build a wireless system within a year using some 3,000 small antennas like these around the city. The mayor believes it will attract new businesses and tourists as well as giving its own citizens a technological leg-up.

MAYOR JOHN STREET: We want a 135-square-mile hot spot so that when a person visits the city of Philadelphia and registers in a hotel and pays $10 a day, they can be connected everywhere, all the time, 24 hours a day, wherever they go in the entire city of Philadelphia.

TERENCE SMITH: Some people are already taking advantage of "WiFi," or wireless fidelity Internet access in this experimental hot spot at the city's famed Love Park. Anyone with a laptop or handheld device can get immediate Internet access without plugging into a phone line. In fact, some Internet clubs have begun to gather there.

And computer training is under way, as well. Tech Access PA, a local non- profit, has assembled lower- income neighbors in this basement at St. Paul's Church. Using the city's pilot WiFi connection, they are learning basic personal computer and Internet research skills.

TERENCE SMITH: Over the next year, city officials hope to extend the wireless service to all of Philadelphia's 560,000 homes and 1.5 million residents at rates ranging from $10 to $20 a month. Not surprisingly, private companies such as Philadelphia-based Comcast and Verizon that offer similar services are less than enthusiastic about the city's plan. In fact, Verizon offers both dial-up and wireless Internet access throughout the city.

ERIC RABE: We think that cities ought to go into this with their eyes open.

TERENCE SMITH: Verizon's Eric Rabe thinks wireless Philadelphia is going to hit some bumps in the road.

ERIC RABE: This is a complex business. The technology evolves, probably turns over every three years, so you need to continually invest in the technology. There are customer service issues; somebody has to be there to fix it at 3:00 in the morning if it doesn't work. And frankly, those of us who have been in the network operations business for years do understand how complex this is.

TERENCE SMITH: The mayor hopes the citywide service will close the digital divide, the technological gulf that separates Philadelphia's affluent areas, where more than 90 percent of residents have Internet access, from the impoverished areas, where fewer than 25 percent can get online.

MAYOR JOHN STREET: Wireless Philadelphia will allow low-income families, families that are on the cusp of their financial capacity, to be able to be fully and completely connected. We believe that our public school children should be -- their families have to be connected or else they will fall behind, and, in many cases, never catch up.

TERENCE SMITH: Some of those families live in west Philadelphia in the neighborhood around the People's Emergency Center, a private, nonprofit shelter for homeless women and children that launched its own digital inclusion project a year ago.

It is, in effect, a miniature version of what WiFi Philly may look like in the future. At this neighborhood lab, residents, including the youngest, learn how to use computers.

SPOKESMAN: So this sends out an Internet signal?

SPOKESMAN: Yes.

TERENCE SMITH: Others learn to repair and rebuild donated computers in a workshop. Gloria Guard is the center's president.

GLORIA GUARD: What we realized is if we can't get computers into the homes of our constituents and our neighbors and of this neighborhood, there are children in those households who will not be able to keep up in the marketplace. They won't be able to keep up with their schoolmates. They won't be able to even apply for college. We thought it was really important to get computer skills and connection to the Internet into as many homes as possible.

TERENCE SMITH: To do that, the center created its own hotspot that provides wireless Internet access to about 100 homes in the surrounding five-block area.

GLORIA GUARD: We've put antennas from rooftop to rooftop, all the properties that we own or friends of ours, and that bounces out there. And then, after one year, those people who are the recipients will roll off and migrate onto a mainstream system because this is really just a pilot.

TERENCE SMITH: Diane Mapp is a 23-year-old single mother who took the training program, bought a rebuilt computer for $125 and uses it for everything from job hunting to schoolwork.

We brought Mapp and some other low-income women together at the People's Emergency Center to discuss how the digital inclusion project has made a difference in their lives.

DIANE MAPP: I am currently enrolled in community college Philadelphia and I use it for different essays, different homework activities and stuff like that. It's very hard for me to use the computers at school -- they're overcrowded -- and it's better for me to use it at home. And I get to study and also spend time with my kid, all in the same place.

TERENCE SMITH: Veronica Meyers is a 50-year-old teacher who lives in the neighborhood and gets her wireless service through the center for $5 a month.

VERONICA MEYERS: I wouldn't have any Internet access if it were not for this program, and it's just been really lifesaving for me. I do all of the small things that everybody does -- pay bills and banking and shopping.

TERENCE SMITH: Tania Sultana is a 17 year old from Bangladesh who learned English on the computer and now repairs them.

TERENCE SMITH: Tania, so, as part of this, here at the shelter, you learned to take computers apart and put them back together again?

TANIA SULTANA: Yes. Like, now, like, most of my friends or family members, when their computer is messed up or, you know, something is wrong with it, they'll call me and they'll be, like, "Tania, I have a problem." I'm like, "okay, I'm not a technician, but I'll come and help you."

GLORIA GUARD: We train these young guys and girls, and they go out into the neighborhood; they're our help desk. And these young people, instead of getting involved in problematic issues in their neighborhoods, they are now considered the computer czars, the tech geeks, the stars of their schools and of the classrooms because they have this kind of expertise.

TERENCE SMITH: While this project has been widely praised, government-subsidized wireless service such as WiFi Philly remains controversial.

Opponents, including the Internet service providers, labor and education groups, got a bill through the Pennsylvania legislature last year restricting other cities in the state from offering subsidized services when private alternatives are available.

At the national level, two bills are pending on Capitol Hill, one similar to the Pennsylvania bill and one that prevents states from banning city-sponsored wireless systems.

Verizon's Eric Rabe:

ERIC RABE: Our view is that this is potentially extremely unfair. I think, if you think this through for a second, you realize that the city is taxing us, to some degree they are regulating us, and now they're a competitor of ours. And I think you have to question whether that's a really genuinely fair situation.

TERENCE SMITH: Mayor John Street:

MAYOR JOHN STREET: It always amazes me that people -- that people raise this argument. There are public utilities all over the country. We own a public utility. We own a gas utility right here. In the end, in the absolute end, Wireless Philadelphia will be a big boost not only to the city of Philadelphia, but to our suburbs, and, in the end, to our commonwealth.

TERENCE SMITH: In fact, private enterprise may already be responding to the competitive gauntlet thrown down by Philadelphia and other smaller cities.

Not long after Wireless Philadelphia announced a pricing structure of $10 to $20 for its service, Verizon rolled out a new offer of its own.

AD SPOKESMAN: More and more people are getting it, getting Verizon Online DSL, that is, especially now that it's just $14.95 a month.

TERENCE SMITH: The battle over whether WiFi should be a public utility or a private enterprise and how it should be priced may just be warming up.