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« MetroFi Signs Foster City | Main | Free Wi-Fi in Nunavut, Canada »
Business 2.0’s Owen Thomas does the math on EarthLink’s earnings: The company is still profitable, but is facing small increases in a marginally profitable broadband market (due to incumbent ownership of DSL and cable lines) and large decreases in its dial-up customer base. The company is working hard on quickly building a Wi-Fi infrastructure business, signing (or trying to sign) contacts with cities all over the U.S. to produce a new structure in which they own infrastructure and wholesale it out. Note to incumbents: EarthLink shares.
Analysts question EarthLink’s ability to run facilities-based operations, although from my talks with EarthLink, it’s clear that they’re contracting out the physical part (which is out of their ken) to experienced telecom infrastructure partners, like Motorola. The logical facilities operations is in-house, and that’s something they’ve run since their inception—billing, network operations, services, etc.
The conclusion? “As the cash that flows from dial-up shrinks, for EarthLink, building its own broadband network isn’t an experiment - it’s a matter of life or death.”
Posted by Glennf at April 20, 2006 12:59 PM
Categories: Financial
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The only hope Earthlink has to make their Business case work in these Wireless Mesh networks (especially in these large metro markets)is the Google Advertising model proves sufficiently profitable to offset the bleeding Earthlink will experience. Key for them is trying to maintain and upgrade their Mesh nets when the inevitable congestion occurs that will require significant $$$ in upgrades-Motorola loves this part in that the Canopy PTMP Radios hold the key to upgrading the throughput on the Mesh.
How can they cost justify paying a 3rd party to operate and maintain this network?? This gets better all the time.
One early test (for City and Earthlink)will be the trial or Pilot the City of Philly is requiring of Earthlink/Tropos before proceeding.
Jacomo
Posted by: Jacomo at April 21, 2006 11:42 AM