Municipal Wi-Fi Dying on the Vine
Yet another project -- Philadelphia Wi-Fi -- has shriveled and is about to die, as beleaguered EarthLink alerted customers it would terminate service June 12.
EarthLink, which had entered into an agreement to finance, build and manage the wireless network and share revenue with the city's Wireless Philadelphia initiative, failed to reach an agreement that would have transferred the infrastructure and operations to the city and nonprofit group.
EarthLink claims the network is worth $17 million.
EarthLink rolled out Wi-Fi networks in five U.S. cities in 2006 and 2007, but most have since failed. It reached agreements with Corpus Christi, Texas, and Milpitas, Calif., to take ownership of networks in those cities as it had hoped to do in Philadelphia. New Orleans is in the same straights as Philly.
A joint effort with Google and the city of San Francisco to provide municipal Wi-Fi there died in August 2007 when EarthLink backed out as its financial status appeared gloomy.
Philebrity, a source of all things City of Brotherly Love, offers the most thorough and flavorful account of the episode. Philebrity's tech writer, Brian James Kirk, reported that EarthLink CEO Rolla Huff put the blame at the feet of municipal officials, saying cities expected to have their cake and eat it too.
"It quickly became evident that we would have a really difficult time changing the perception by some of the cities that we owed them a free network rather than the city stepping up to make the business model viable for both them and for our shareholders," Hoff told reporters and interested parties during a conference call announcing the end of the ISP's wireless efforts in Philadelphia.
But the truth, according to astute news readers, is that a free network is exactly what EarthLink promised Philadelphia in 2005 when it won a public bid for the project. The city's former CIO cited EarthLink's offer to shoulder the construction cost as the reason it won the bid. It was only later that EarthLink and the cities involved realized how expensive and taxing the projects would be.
EarthLink is probably correct. Government may need to step up and throw some skin in the Wi-Fi game if the network will be a public utility. But EarthLink shouldn't pretend that it said otherwise at the beginning.