Local News Matters weekly newsletter

Start your week with a little inspiration. Sign up for our informative, community-based newsletter, delivered on Mondays with news about the Bay Area.

San Jose intends to help low-income residents pay for broadband services through a unique public-private partnership between the city of San Jose, San Francisco-based company Helium and the nonprofit California Emerging Technology Fund.

The partnership was announced Wednesday by Mayor Sam Liccardo and Helium COO Frank Mong.

It’s a first-of-its-kind program that converts HNT cryptocurrency tokens mined from Helium hotspots to prepaid cash cards given directly to qualifying low-income families to subsidize their internet plans.

This is believed to help a majority of those families who reported cost as the main reason for the lack of access, Liccardo said.

The cryptocurrency is mined through the relatively small hotspot-like devices placed inside someone’s home who already has internet. It’s an energy-efficient device that uses less than two megabytes per month of data.

“What you’re doing is you are essentially becoming the owner and operator of a mini cell tower, in a sense,” Mong said. “It doesn’t replace your current Wi-Fi router at home, it augments that router so that you can share the bandwidth that you do have across a long range.”

The range is measured by miles and the bandwidth dispersed is not strong enough for Netflix streaming, for example. Instead, it connects little sensors that transmit tiny bits of data for something like air quality tracking sensors, Mong said.

The long-term goal of the company is to build out the largest decentralized peer-to-peer internet network, which is something Helium is doing by building out more than 200,000 nodes of Helium hotspots, Liccardo said.

A network of hotspots

The pilot program, which is already six months in, received a $10,000 grant from the California Emerging Technology Fund to place 21 hotspots around the city without using any funding from the city of San Jose, Mong said.

Each Helium hotspot device costs about $400 to $500 and can mine cryptocurrency, which is a major offset to the roughly $300,000-$400,000 required to build one cell tower.

Liccardo said the program would cover the expenses of 1,300 families for one year by providing participants with a one-time $120 payment.

Nine hotspots have already been deployed in residential homes and small businesses around downtown San Jose and other parts of the city, one of which is at Liccardo’s house.

Ideally, the remaining 12 hotspots would be placed in lower-density areas to make the most out of mining, and therefore, more money for residents, Mong said.

“(Y)ou are essentially becoming the owner and operator of a mini cell tower, in a sense. It doesn’t replace your current Wi-Fi router at home, it augments that router so that you can share the bandwidth that you do have across a long range.”

Frank Mong, Helium COO

To quell concerns about data breaches and encourage more individuals to place a Helium hotspot in their home, Mong broke down how the Helium hotspots were relatively safe in terms of cybersecurity.

“It’s no sort of worse than the risk of your internet-connected printer,” he said. “I would categorize this as very similar to all the devices connected in most people’s homes.”

Still, “nothing is foolproof,” Mong said.

“This device is peer to peer, so it does need to speak and talk to other hotspots nearby and that’s through over the air,” he continued.

Encrypted and secure

But two main components make cybersecurity risks slim, he said.

The first is that the hotspots are listening to small bytes of data on analog, “So there isn’t a traditional IP address it’s broadcasting in sort of traditional IP based networks,” he said.

The other reason, Mong said, is because the data is end-to-end encrypted, even when it is in transit.

A Helium hotspot device. (Photo courtesy of city of San Jose)

What that means is the data comes in fully encrypted from the sensor and stays encrypted while the hotspot hears it. It then uses the blockchain as an address lookup mechanism where the blockchain knows where that data goes. Then that blockchain sends the data, fully encrypted, to the owner’s cloud and stays encrypted until the owner receives the data.

The hotspots also do not access people’s own internet activities.

Mong and Liccardo hope to encourage internet-connected residents to get involved with the program and families experiencing the digital divide to sign up for assistance.

Residents interested in hosting a Helium hotspot can sign up online.

Those with additional questions can sign up for assistance.