Tuesday, May 13, 2008

Wi-Fi: can’t even give it away

Not only is Earthlink getting out of municipal Wi-Fi, but it can’t even give it away:

The Atlanta-based Internet service provider said Tuesday that it could not find a buyer for the $17 million network and that talks to give it to either the city or a nonprofit organization had failed.

City officials have said it would cost taxpayers millions each year to operate the network.

“It's been an unfortunate situation,” Chief Executive Officer Rolla Huff told The Associated Press. “It was a great idea a few years ago, ... but it's an idea that simply didn't make it.”

EarthLink, which will give current customers until June 12 to switch to another provider, said it even offered to donate the Wi-Fi equipment to someone and give them an additional $1 million.
Earthlink’s announcement implies that their other business are sound, but, frankly, if they don’t grow in wireless access it seems that they are doomed to be a declining seller of dialup access and reseller of broadband that competes with their cable and DSL suppliers.

Still, Earthlink will probably outlive the imminent death of the municipal Wi-Fi movement, which has been facing imminent death for more than a year. With Earthlink abandoning systems already built, other cities have decided not to even start.

It must be a pretty lousy business that you can’t even make a business with a zero capital cost? At least the new Iridium was able to turn a profit after acquiring its assets for a half cent on the dollar. At least satellite phones have a small niche of customers who have no alternative, as opposed to connectivity in a big city where there are cable, DSL, dialup, local hotspots, libraries and increasingly 3G mobile phones.

However, the local nonprofit, Wireless Philadelphia, seems to be in denial:
Wireless Philadelphia and the City of Philadelphia continue to work together to ensure a positive future for Philadelphia's municipal wireless network and nationally-recognized Digital Inclusion program, the vision of which is to provide all citizens with access to essential technological resources for education, employment, and other life opportunities.
Good intentions and noble causes don’t obviate economic reality. It’s good to see such “frill” services held to some measure of economic accountability, even if the core functions of government are not.

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