EarthLink Getting Out of Muni Wi-Fi Biz?
Nov 19, 2007
According to a report in InfoWorld, EarthLink may be trying to sell its municipal Wi-Fi business, which it values at around $40 million. It seems that the company's muni Wi-Fi trials and tribulations may finally be more than CEO Rolla Huff is willing to endure and so EarthLink is considering "strategic alternatives" that could include a sale, spin-off or partnership of some kind.
It's unclear at this point exactly what that would mean for Earthlink's existing Wi-Fi projects in cities like Anaheim, CA, New Orleans, LA and Philadelphia, PA, though the company said it will continue to work closely with those municipalities through any transition.
A weekend story by the Associated Press pointed out that Houston had also planned a $40 million to $50 million Wi-Fi network with Earthlink that's "in limbo." The AP highlighted EarthLink's delays in Philadelphia as well, describing the project as "nearly a year behind schedule and beset by cost overruns."
We should add that less than two weeks ago, the CEO of Wireless Philadelphia (the nonprofit in charge of the city's Wi-Fi network) defended the project. In an editorial that appeared in The Philadelphia Inquirer on November 7th, Greg Goldman wrote:
Philadelphia's wireless initiative remains on track...EarthLink is investing millions in Philadelphia, creating tremendous opportunities for our city and its citizens. Further, this kind of network has never been built on this scale anywhere. Philadelphia is on the cutting edge.
EarthLink has made a rational business decision to focus on Philadelphia and retreat, for now, from similar projects elsewhere to avoid repeating mistakes in multiple markets...There are growing pains, just as there were when the telephone, cable and cellular industries began installing networks. The value of the network will best be judged when it is fully installed and optimized.
Tags:
Earthlink, muni wi-fi, Philadelphia
