EarthLink will shut down its citywide wi-fi project in Philadelphia next month. Once hailed as “an unprecedented public/private partnership,” the whole thing was a flop. The wi-fi was flaky, and EarthLink’s (ELNK) business model was… not a business model. Which is why new CEO Rolla Huff is pulling out.
EarthLink tells the AP that they couldn’t find a buyer for their $17 million network. What’s a bit more confusing: They can’t give the network away. “EarthLink… said it even offered to donate the Wi-Fi equipment to someone and give them an additional $1 million,” the AP reports. “Comcast and Verizon, they haven’t even sniffed around,” Philly Councilman Frank Rizzo said.
We could understand why a company like Comcast (CMCSA) wouldn’t want to work hand-in-hand with the city or a nonprofit on a project like this.
But at the same time, a citywide wi-fi network — especially one that’s mostly built — could be a unique service that the Philly-based cable giant could exclusively offer its hometown customers. The potential pitch: Pay for Comcast cable modem service at home and roam around Philly for free. If anything, it’s one last reason not to ditch Comcast for Verizon (VZ), which will soon roll out its faster-than-cable FiOS Internet and TV service across Philadelphia (if it isn’t already).
Comcast already has the backbone pipe in town, and unlike its $1 billion-plus investment in Clearwire’s (CLWR) WiMax network, wi-fi works with all the gadgets you already have, like laptops, iPhones, PSPs, etc. So why aren’t they biting? Or did we just spoil their last-second bailout?
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