Phila. in takeover talks for Wi-Fi network

June 10, 2008 10:22:56 PM PDT
Philadelphia is in talks with a group to take over its wireless Internet network. A spokesman for Mayor Michael Nutter said negotiations are under way. But he would not say whether they involved a community organization or a company.

EarthLink Inc., which built the network, is scheduled to shut it down on Thursday.

Last month, the company announced that it was pulling the plug on its troubled wireless high-speed Internet network, once touted as a national model. It suffered from connection problems and didn't attract enough subscribers.

Last month, the Atlanta-based Internet service provider sued the city, seeking to remove its Wi-Fi equipment from streetlights and cap its liability at $1 million.

EarthLink, which couldn't find a buyer for the $17 million network, also said talks to give it away to the city or a nonprofit group failed. City officials said it would cost taxpayers millions of dollar annually to operate the network.

Four years ago, Mayor John Street unveiled a plan to create a citywide Wi-Fi hotspot covering 135 square miles. Philadelphia would have been the first major U.S. city blanketed with wireless Internet access. It was an ambitious vision that brought global recognition to the city.

But complaints from users that EarthLink's municipal Wi-Fi was unreliable at prices that weren't much cheaper than DSL, for people who aren't low income, kept subscriber rolls at just under 6,000 out of a projected 100,000.

In May, EarthLink notified customers that the Wi-Fi network in Philadelphia will be shut down. The company has reached agreements with the cities of Corpus Christi, Texas and Milpitas, Calif., which are taking over the networks. It has closed down the one in New Orleans and is in talks with Anaheim.