Title
Wi-Fi Service Concession Agreement (Ordinance S-45745)
Description
Request to authorize the City Manager, or his designee, to issue a Revenue Contract Solicitation (RCS) to provide Wi-Fi service at Phoenix Sky Harbor International Airport (PHX) and extend the existing Contract 137897 with Boingo Wireless, Inc. (Boingo) on a month-to-month basis for up to one year, terminating no later than July 31, 2020. Estimated annual revenue in the new contract will be approximately $340,000.
Report
Summary
The Aviation Department currently contracts with Boingo to provide and support public Wi-Fi service in all terminals, the Rental Car Center, and all Sky Train stations at PHX. On average, out of the 123,000 daily passengers, there are 33,000 unique users that connect to the Wi-Fi service. On an annual basis, approximately 12 million passengers access the Wi-Fi service at PHX. The current contract with Boingo is set to expire on July 31, 2019.
The current contract is a concession-based agreement. Boingo pays a Minimum Annual Guarantee (MAG) or a percentage of gross sales, whichever is higher. In 2018, Boingo paid the Aviation Department approximately $851,000 for operating the Wi-Fi service concession.
The Aviation Department will issue an RCS to award a Wi-Fi service concession contract for PHX, and the successful proposer shall implement and maintain an uninterrupted Wi-Fi service. The contract will allow passengers to choose free Wi-Fi or a pay-for-use Wi-Fi service with the service provider. The service will support desktops, laptops, smart phones, tablets and other end devices with Wi-Fi capability.
Wi-Fi service will cover the following airport locations:
- Terminal 3.
- Terminal 4.
- Rental Car Center.
- All Sky Train stations at PHX.
The successful proposer shall be responsible for providing new Wi-Fi service no later than the end of July 2020 and shall be accountable for all costs associated with the implementation and maintenance of the Wi-Fi network throughout the term of the contract and any exercised extension options. The successful proposer will also be responsible for seamlessly transitioning Wi-Fi service from the existing vendor to prevent any adverse impact to service for passengers.
The Aviation Department is requesting a month-to-month extension of the current contract for up to one year to allow time to issue the RCS and award a new contract. The extension will also allow the successful proposer sufficient time to implement a new system and transition PHX to the new service provider should the incumbent not be successful in the solicitation process.
This item has been reviewed and approved by the Information Technology Services Department.
Procurement Information
The Aviation Department will issue an RCS to select a service provider to implement and maintain the Wi-Fi service. Responsive and responsible respondents will be evaluated according to the following criteria:
- Approach to providing Wi-Fi service.
- Proposed MAG.
- Proposed business plan.
- Qualifications and experience in providing Wi-Fi service at other airports and/or similar large venues.
Contract Term
The term of the contract will be three years, with two one-year options to extend, to be exercised at the sole discretion of the Aviation Director.
Financial Impact
Revenue for the Aviation Department will be set at MAG or a percentage of gross sales, whichever is greater. MAG will be set for the new contract based on PHX historical and market data. Estimated annual revenue will be approximately $340,000.
Concurrence/Previous Council Action
This item was recommended for approval at the Aviation and Transportation Subcommittee meeting on May 28, 2019, by a vote of 3-0.
Location
Phoenix Sky Harbor International Airport, 3400 E. Sky Harbor Blvd.
Council District: 8
Department
Responsible Department
This item is submitted by Assistant City Manager Deanna Jonovich and the Aviation Department.