New York City will be transformed into a smart city soon with the installation of around 500 WiFi kiosk that is set to replace the current public phone. The installation which is also part of an investment by a consortium including Google is seen as an attempt for the technology giant to rival the US telecoms market.

The Wall Street Journal reported that there will be a total of 500 units to be installed for the first phase by the end of July this year. The service will be further expanded in the future to include a total of 7,500 units in New York City alone.

According to the plan, the hotspot will be using the same telecommunication line for the public phone. But instead of using the same cable, a new fiber network will be used to link between the telephone and the WiFi hot spot.

Each of kiosk installed will also act as an advertisement board with two digital screens on each side of the kiosk as reported by the Financial Times. The nine-foot tall kiosk will also contain a hands-free phone and Android tablet for web browsing and pedestrian can also use the phone to make a free call using the Voice over IP system since the internet connection there will be very stable.

The free WiFi is made possible because of the advertisement put on the kiosk. According to Recode, the advertisements run on the kiosk is expected to generate a total of $40 million per year when all the kiosks are installed.

Besides Google, other tech company backing the consortium known as LinkNYC includes Qualcomm Inc., CIVIQ Smartscapes and Intersection. The consortium will be handled by CityBridge which also invested a total of $200 million for the project.

According to Intersection's Chief Innovation Officer, Colin O'Donnell, the project will help to turn New York into a city with the best internet coverage. He also added that "We're deploying a network that's so fast the most recent iPhone is only capable of using less than half its available speed."

Meanwhile, the news is not welcomed by telecommunication giant including AT&T. According to MoffetNathanson senior research analyst, Craig Moffet, "There's a reasonable argument that this time really will be different." Referring to the new service offered by the consortium.

A spokesperson for CityBridge told reporters that the consortium will pay $500 million or 50 percent in revenue from the advertisement run on the kiosk to the New York authorities. He also added that the main goal of the project is to improve future telecommunication business by making an impact on the digital divide.