Certain Silence

The past two weeks have been pretty brutal for fans of municipal wireless. Over the course of a few short days came news of Chicago and Rhode Island shelving their ambitious wif plans, followed by sharp cuts at Earthlink, the company behind many of the other wifi projects that people have been talking about (San Francisco, Houston, Philadelphia).

Muni wifi seems terminal, much to the joy of some. But a proper diagnosis of the symptoms is in order, since it might shed some light on the future viability of similar projects.

Sign of MuniWifi meltdown #1: Earthlink’s in Trouble

Of course it is. Seriously, could muniwifi find a more disfunctional standard bearer? Earthlink’s three core businesses in addition to municipal wireless include:

• Helio, one of the few (only?) remaining US MVNOs, which has slick adds, slicker phones and no subscribers.
• A dialup (!) Internet access division, as the country transitions to broadband.
• A broadband division, which like the few remaining CLECs, re-sells DSL run on the incumbents lines.

None of these is a growth proposition. Seriously. And starting out in a new and untested field is going to require milking your other core businesses for cash and capital while things get up and running (see Sprint’s WiMax plans). Earthlink’s got nothing. Earthlink’s cuts reflect deeper problems with its core businesses, and frankly, lousy management, not necessarily the underlying viability of muniwifi.

Tags: muniwirelessmuniwifi Earthlink wifi