EarthLink turns dial-up lemons into muni Wi-Fi lemonade

Computerworld - Grandmothers have long advised that when life gives you lemons, you should make lemonade. That's been EarthLink's approach to dramatically changing industry conditions and the advent of municipally sponsored wireless networks.

EarthLink Inc. has long been a leading nationwide vendor of dial-up Internet access but, with users migrating to broadband connections such as DSL and cable, it needed to find new lines of business. EarthLink resells broadband provided by other vendors, most notably large telecom operators, but that isn't a sound basis for its future, said Cole Reinwand, vice president for EarthLink's municipal networks business unit.

"Our heritage is dial-up," Reinwand said. "We've built a significant base of broadband users, but ultimately, we're beholden to the incumbent [telecommunications] carriers, and it's hard to get our prices down to where we can make a compelling offer."

Reinwand said that just when EarthLink began exploring new ways to provide connectivity, U.S. city governments started looking seriously at providing wireless broadband access to their citizens.

"We looked at a number of [connectivity] options, and it was a happy coincidence that cities were thinking about the same thing," Reinwand said.

Now, EarthLink has entered the business of installing and running citywide wireless networks for municipalities. It currently is contracted to do that in Philadelphia, New Orleans, and Milpitas and Anaheim, Calif., and news reports have it bidding in many other municipalities.

Helping and competing

While municipal wireless networks open new avenues for EarthLink, they also put the company in direct competition with well-entrenched cable and telecom companies that already provide broadband access, Reinwand acknowledged. But adding competitors is a good thing, he said.

"There isn't enough choice and competition in the marketplace," Reinwand said. "Based on the lack of competition, [broadband] prices aren't coming down. If we're relying on market forces, what we need to do is introduce more competition."

Besides benefiting EarthLink, Reinwand said, the company's new line of business helps cities and their citizens.

"There's a significant population that's economically disadvantaged," Reinwand said. "In our society today, we can't afford to let people get left behind just because they don't have access to information on the Internet." But he noted that municipal Wi-Fi networks help all taxpayers.

"City IT organizations recognized the value that could be provided through mobile access to help their workers in the field achieve significant efficiency," Reinwand said. "Today they have to go out to inspect a building or whatever, then come back to the central office. That travel time is wasted. So they think they can achieve one or two hours a day in increased productivity."

Win-win

Reinwand is very familiar with the strong opposition to municipal networking projects from both the telecom operators and others who believe that government should not compete with private enterprise and that such networks put taxpayers at risk. But he disagreed with those arguments, noting that EarthLink is taking the financial risk, not the cities and taxpayers.