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Earthlink Backs Out of San Fran Wi-Fi
Pays Houston $5 million for delaying project...
by Karl Bode 10:06AM Thursday Aug 30 2007 Tipped by whocares0 See Profile
Just a few days after EarthLink announced they'd need to lay off half of their workforce, the company announced it will have to pay a $5 million penalty to the city of Houston for delaying the Muni-Fi project. The company is also officially pulling out of the San Francisco Wi-Fi project, though San Francisco mayor Gavin Newsom says the city is pushing forward:
quote:
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"We are still committed to free Wi-Fi, and we are going to get it done — quickly," said Nathan Ballard, a spokesman for Mayor Gavin Newsom. "We are disappointed, but we will not lose momentum here." Earthlink Chief Executive Rolla Huff told Newsom during a telephone call "they were not going to be able to fulfill their end of the bargain," said Ballard. "Mr. Huff made it clear it wasn't going to happen with Earthlink; they are getting out of the Wi-Fi business."
When we listened in on the company's conference call yesterday, CEO Rola Huff insisted the company wasn't getting out of the Muni-Fi business -- they're just scaling back -- obviously, on a massive scale.

"Our core business has been diluted by new business initiatives that were begun with good intentions but morphed into larger commitments," said Huff. "We are not exiting these growth initiatives; we're scaling back their cost structures to fit the startups that they in fact are."

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Alpine
Premium
join:2000-01-11
Atlanta, GA

A shame...

It's a shame to see Earthlink going down like this. I worked for MindSpring early in my career and hated to see Earthlink buy them, though they handled it relatively well.

The days of free massages, keg parties on the roof and the CEO wearinng a Hawaiian shirt around the office in midtown Atlanta are long gone.

Adam

N3OGH
Yo Soy Col. "Bat" Guano
Premium
join:2003-11-11
Philly burbs
kudos:2

Re: A shame...

Man, rough week for Earthlink.....

DjVaGGo
Premium
join:2004-10-23
Long Island City, NY

Re: A shame...

said by N3OGH:

Man, rough week for Earthlink.....
Definitely
whocares0
Premium
join:2003-07-26
..
even though don't use either wifi or earthlink,sound like MAYBE earthlink did/is doing what the airlines did a number of yrs ago, namely,tried to grow to fast,into to many markets
Automate

join:2001-06-26
Atlanta, GA

1 edit
I guess it depends upon your perspective. Their stock is up over 10% so far this week. They are just making the tough decisions about business operations which will never make money.

The early muni projects were able to take advantage of the fact that many companies were willing to "buy" into the project.
Rhanlav
Dook?

join:2005-01-28
Jacksonville, FL
said by N3OGH:

Man, rough week for Earthlink.....
No kidding.

Guess I have plenty of reasons to look into a new ISP now.

spewak
R.I.P Dadkins
Premium
join:2001-08-07
Elk Grove, CA
kudos:1
Reviews:
·SureWest Internet

Say what?

"Our core business has been diluted by new business initiatives that were begun with good intentions but morphed into larger commitments," said Huff. "We are not exiting these growth initiatives; we're scaling back their cost structures to fit the startups that they in fact are."
In other words: We are losing our shirts, bigtime!!
--
The weekend is here, grab a can of beer!

inteller
Sociopaths always win.

join:2003-12-08
Tulsa, OK

Yeah, they are going down.

These kind of soft retreats are a sign of bigger things to come.

They are going down.

Start shorting stock now.
--
"WHEN THE LAUGH TRACK STARTS THEN THE FUN STARTS!"

dvd536
as Mr. Pink as they come
Premium
join:2001-04-27
Phoenix, AZ
kudos:4

Re: Yeah, they are going down.

said by inteller:

These kind of soft retreats are a sign of bigger things to come.

They are going down.

Start shorting stock now.
I'm surprised they lasted this long. I also remember Mindspring.
--
You can never be too rich, too thin or have too much Bandwidth

jester121
Premium
join:2003-08-09
Lake Zurich, IL

Re: Yeah, they are going down.

said by dvd536:

I'm surprised they lasted this long. I also remember Mindspring.
How about Netcom?

My first ISP after AOL. Remember their stupid "@ix.netcom.com" addresses?

Doctor Olds
I Need A Remedy For What's Ailing Me.
Premium,VIP
join:2001-04-19
1970 442 W30
kudos:18

Re: Yeah, they are going down.

said by jester121:

said by dvd536:

I'm surprised they lasted this long. I also remember Mindspring.
How about Netcom?

My first ISP after AOL. Remember their stupid "@ix.netcom.com" addresses?
I still have one. They were still being handed out by Mindspring to anyone that wanted one in 1999/2000 before the buyout.



--
What’s the point of owning a supercar if you can’t scare yourself stupid from time to time?

Scatcatpdx
Fur It Up

join:2007-06-22
Portland, OR

Going Down

Sounds like cash flow problems

FFH5
Premium
join:2002-03-03
Tavistock NJ
kudos:5

Re: Going Down

said by Scatcatpdx:

Sounds like cash flow problems
Yes, as in the Venture Capital companies no longer see them ever making it as a growth company and have cut off the money that has always kept them from going under.
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Stovokor

join:2007-08-02
Omaha, NE

:)

It's like when you're a little kid, and you see a spider in the sink, and your first instinct is to turn on the faucet and watch the spider drown in it's own ironic curiousity.

You can't help but smile.

SLD
Premium
join:2002-04-17
San Francisco, CA

Houston deserves this

I remember local ISPs were complaining that they were forced out of the bidding process by the City and Earthlink. I guess Houston is enjoying the benefits of politics.

inteller
Sociopaths always win.

join:2003-12-08
Tulsa, OK

Re: Houston deserves this

well, since the people that really suffer are the end users I don't think the city cares.
--
"WHEN THE LAUGH TRACK STARTS THEN THE FUN STARTS!"

tangfrost

@autotrader.com

Sad considering

So sad considering that once MindSpring was such wonderful place to work. I cut my tech teeth there and hung a year into the merger. Wasn't handled well on my end bailed when things just got worse.

Sooo many poor decisions...at least the folks that approved the merge got pummeled in the Stock Market.
qworster

join:2001-11-25
Bryn Mawr, PA

I know why this is happening to them...

It's because the company I worked for went out of business and cancelled their Earthlink T1 line early last week...It caused a cascade....

fatmanskinny
Premium
join:2004-01-04
Wandering
Reviews:
·Vonage
·Comcast Digital ..

Shareholder value?? What about customer and employee value?

"Rolla Huff, the new CEO since June, is now focusing on returning shareholder value. And in addition to the massive cuts across the company announced Tuesday, he has also scaled back investment in new citywide Wi-Fi projects until the company comes up with a more viable business model that doesn't require EarthLink to foot the entire bill for building these networks."

This is one of the biggest problems with corporate America...little to no positive focus on the customer first. You can see this evident from the CEO down to the McDonald's rep who acts like you are bothering him to take your order.

I am really sick and tired of this money-first focus. If all of EarthLink's current customers who do not invest in the company decided to jump ship, do you really believe the shareholders would step in and become customers to save the sinking ship? I highly doubt it.

Where are the companies who put their customers first, provide service far beyond what they are being compensated for, provide the right tools for their employees to perform their jobs and more?

Rolla is only playing the role EarthLink is paying him to play..."the sky is not falling, we are just getting taller!" I don't have anything against him....he is just another employee in the cog and has to say and do what his "bosses" (Sky Dayton and the Board) wants him to say and do.

Rolla knows in his heart that EarthLink is a shot brand...no longer trustworthy, the telcos and cable companies have the FCC on their side, outsourcing didn't work for them long term (as a company, not necessarily as Executive John Doe who will get X amount of dollars when the Link folds).

Rolla got this gig not to turn it around but to be the face for lowering the boom. Rolla will be rolling away with a good amount of cash when his "mission" is complete.

Shareholder value? Puhleeze.
--
The only place where Success comes before Work is in the dictionary.
DSL Oberst

join:2001-11-29

Re: Shareholder value?? What about customer and employee value?

said by fatmanskinny:

Where are the companies who put their customers first, provide service far beyond what they are being compensated for, provide the right tools for their employees to perform their jobs and more?
They were buried by the money-firsters.

said by fatmanskinny:

he is just another employee in the cog and has to say and do what his "bosses" (Sky Dayton and the Board) wants him to say and do.
Just an FYI...Sky Dayton has had absolutely no say in the company or any of its decisions since Garry Betty became the big man on campus. 'Course, he's dead now. However, Dayton sold his interests in the company long ago.