MuniWireless explains EarthLink's new stance towards metro-scale networks: Carol Ellison writes that the new CEO of EarthLink said the firm's approach towards muni-Fi isn't working, and anchor tenancy will be required for future projects with a commitment for service on completion of the network. It's not unexpected, as it's precisely why MetroFi shifted their model. It's been several months since the free lunch ended, and municipalities are, I'm afraid, still reeling from the news that they may have to run financial analyses to determine cost conversation, and talk to voters about committing funds that they expect to get back in savings.
That's a different ballgame than "we build it, cities can choose to buy services" or even a true public-private partnership. This is a hybrid of a few different approaches, but it means the city still is in the position of being a customer, not a network builder. Cities now will put more at risk by committing funds towards services that might not be delivered if networks can't be completed or firms go out of business or exit markets. The risk increases because cities will have to terminate current services to reap savings, and thus put their connectivity and productivity in jeopardy against a new network. Cities might then be in a position to have to spend money suddenly to assume control of a failing network--depending on contract terms--to keep continuity of service.
This was true even when networks were being built at companies' expense with cities choosing to migrate services. But in this new anchor-tenant approach, cities have to commit before networks are built, even if they have objective, independent tests that have to be passed before they start paying money to the service provider.
Meanwhile, the Kite Networks division of MobilePro (a public company) is sold to Gobility (a private) one: The deal, announced today, but disclosed in an SEC filing July 10, indicates that Gobility is paying $2m in convertible debentures to MobilePro, meaning that it's a stock deal. Gobility must raise $3m in cash by August 15, according to the filing, or default, in which case MobilePro can pay a nominal amount to re-acquired Kite. Kite operates a few Wi-Fi networks, the largest ones in the Southwest, and provides Sprint-branded wireless broadband in the 2.5 GHz. Kite claims 17,000 customers across all its operations.