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Philly's Wi-Fi network in jeopardy

EarthLink is supposedly threatening to shut down Philadelphia's citywide Wi-Fi network as it negotiates a way out of its 10-year contract to build and run the network.

The fate of Philadephia's citywide Wi-Fi deployment is still in limbo as EarthLink threatens to pull the plug.

EarthLink, which fronted $20 million to build the network and has completed 80 percent of the build-out, stopped accepting new customers last week, according to a report by Metro Philadelphia. The company has also supposedly given the city a deadline of this week to come up with a plan to take over the network or sell it to a third party.

EarthLink, which won the contract in 2006 to build what was at the time to be the largest citywide Wi-Fi deployment in the nation, said earlier this year that it's getting out of the Wi-Fi business.

The company had aggressively pushed its municipal Wi-Fi strategy. And Philadelphia was one of several large contracts the company had won to build citywide Wi-Fi networks.

Wi-Fi graphic

But after the death of EarthLink's CEO Garry Betty in early 2007, it quickly became clear that the Internet service provider had a change of heart when it came to Wi-Fi. Within months, the company had wiggled out of several contracts with cities such as San Francisco and Houston. Early this year it announced it was abandoning the business altogether, and it started negotiating with five cities in which networks had already been built or partially built.

Last month, it announced it had reached agreements with Corpus Christi, Texas; Milpitas, California; and New Orleans. The city governments of Corpus Christi and Milpitas decided to take ownership of the networks and run them themselves. But New Orleans did not. The network, which was already up and running, will be dismantled starting May 18.

A spokeswoman for EarthLink said the company is still negotiating with Anaheim, Calif., and Philadelphia, the two remaining deployments.

Greg Goldman, CEO of Wireless Philadelphia, the nonprofit set up to help low-income residents connect to Philly's network, said in a blog post on Wednesday that there is nothing in the 10-year agreement with EarthLink that permits the company to impose deadlines for the network's transfer or to turn off the service and remove equipment.

In fact, according to Metro Philadelphia, EarthLink still owes Wireless Philadelphia $1 million to be paid by May 23 as part of its 10-year contract with the city.

From the beginning of the project, Philadelphia city officials have been adamant that they do not want to spend taxpayer money to build or run the network. As a result, they negotiated a very favorable contract that put much of the burden on EarthLink.

Since EarthLink stopped construction of the network in February, the city has been working to find someone else to complete the construction and run the network. According to Goldman, Philadelphia Mayor Michael Nutter is still committed to the project.

"As an organization, Wireless Philadelphia clearly believes there is great value in the initiative for a variety of purposes--most importantly, extending the profound educational opportunities provided by technology to the thousands of families in Philadelphia who do not have it," he said in a blog post Thursday. "We are extremely grateful to Mayor Nutter and the Nutter administration for the aggressive efforts they are making along with us to find a replacement for EarthLink and to breathe new life into this vital project."