The AP reports that Philadelphia has signed its contracts with EarthLink: The deal includes 4,000 utility poles and $300,000 in utility payments from EarthLink per year plus $2 million in advance payments against revenue. These funds will be used to purchase 10,000 computers and training for low-income families; Phila. has a huge computer ownership gap as well as broadband and Internet access gap. The non-profit Wireless Philadelphia will receive five percent of EarthLink's revenue, which is roughly the same as cable franchise fees. EarthLink will also provide $9.95 per month accounts for up to 25,000 low-income households, and 22 free Wi-Fi hotspots around down.
The contract spans 10 years and is estimated to cost $20 to $22 million to fulfill. Note that this isn't a different number from earlier expectations. The network was originally expected to cost $10 to $12 million to build and $1m per year to maintain. Over 10 years, an estimated $20-$22m conforms to that range.
The city government will receive 3,000 accounts--1,250 free, 1,750 discounted--and 700 discounted "T-1" accounts, the AP reports, which are really point-to-multipoint broadband wireless connections over the Motorola Canopy aggregation network. Not mentioned here is Philadelphia moving other chunks of its existing data and telecom spending to Wireless Philadelphia and EarthLink; that amount was once estimated in the millions per year.
EarthLink's wholesale rate will be higher than the rate that Wireless Philadelphia initially anticipated: $12 per month rather than $9 per month. This rate could vary based on volume of customers by retail partners. Retail pricing isn't noted here, but an EarthLink representative confirmed Thursday that the expect rate is about $20 per month, but that some retail partners will certainly offer lower prices.
The next step? A 15-square-mile test network.
(Updated Thursday with information from an EarthLink representative.)