Philly eyes options if EarthLink abandons city Wi-Fi effort

The city's CIO expects EarthLink to pull out within a year

Philadelphia's CIO said today that he believes there is a 75% chance that EarthLink Inc. will sell or abandon its ambitious citywide Wi-Fi network operation in a year. As a result, the city is already making contingency plans in case that happens.

Terry Phillis, who has held the CIO post for the past year, said the city expects to know more within 60 days about what Atlanta-based EarthLink will do regarding its Philadelphia operation. Although a sale of the Wi-Fi network to another private network builder and operator would be preferable to having the city take control of the project, Philadelphia officials want to be prepared for either possibility, Phillis said in an interview today.

"We consider [the Wi-Fi network] an asset for the city," Phillis said. "Our priority is to get it completed, to service the digital divide, to enhance tourism and to serve mobile city workers. But I can't talk a lot about our plans" if Earthlink leaves.

Construction started in earnest in May, and more than 70% of the 135-square-mile network is now in place, Phillis said. EarthLink has estimated that building the network and running it for 10 years will cost $22 million.

EarthLink CEO Rolla Huff in November assured former Philadelphia Mayor John Street that EarthLink would finish the 135-square-mile Wi-Fi mesh network, Phillis said. Huff offered that assurance, he said, even after EarthLink on Nov. 16 issued a short statement in which it said that it was considering "strategic alternatives" to its $40 million nationwide municipal wireless business.

Phillis said he expects EarthLink will leave the Philadelphia project. He based that prediction on EarthLink's November statement and its announcement last August that it would lay off 900 workers by the end of 2007. "That statement said to me that Wi-Fi is no longer in their strategic initiatives, and they wouldn't make that statement if they were continuing here," he said.

Phillis said he thinks "tens of thousands" of subscribers are now using the new network but, he added, "honestly, I don't know."

EarthLink has not divulged the number of subscribers in Philadelphia and could not be reached for immediate comment today. The city and the taxpayers are not paying anything for the network buildout or operation, and the city has no legal right to such information under the existing contract, Phillis explained. That contract also gives Philadelphia the right to reject a future buyer.

Although Phillis has little information about the current number of subscribers, he sits on a technical advisory board that has urged changes in the network rollout, including the addition of more access points for greater wireless coverage.

The board includes representatives of EarthLink, the city and a nonprofit called Wireless Philadelphia, a group working to ensure that qualified low-income residents get access to the network. About 750 people have been signed up for the program so far, with the city hoping for 1,000 such subscribers by May, Phillis said.

In terms of access points, EarthLink has boosted the number of Wi-Fi mesh nodes from Tropos Networks Inc. by 40% in some areas to improve connectivity, and it has started requiring customer premises equipment to improve signal quality for those who order service by phone, Phillis said. In some hilly and dense areas, EarthLink changed its earlier plans and has added access points from Alvarion Inc., he said.

Responding to user complaints about EarthLink's help desk, the service provider instructed help desk personnel on how to focus more directly on problems of Philadelphia customers, Phillis said.

Phillis noted that customers who are connected are seeing fast speeds -- up to 4Mbit/sec. on the downlink, which is more than double what EarthLink has advertised. Though that performance is partly attributable to the fact that the network is not yet full of users, he said.

The city is already beginning trials with its city inspectors and first responders to see how they can use the Wi-Fi network to conduct city business. For first responders, the Wi-Fi links would only serve as a backup network to 800 MHz emergency radios. Inspectors could use handhelds or laptops to file reports over the network, eliminating the need to write paper-based reports that have to be filed digitally on PCs at the end of each day.

In all, Phillis said he would give the municipal Wi-Fi project a 7 out of 10 for overall success -- even with the uncertainties about EarthLink. "We're at the center of discussions worldwide about finding ways to bridge the digital divide," he explained. "Philadelphia is actually doing it.... I wish in many ways the project were doing better, but we're on the leading edge of something new."

Copyright © 2008 IDG Communications, Inc.

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