A year after Philadelphia gave EarthLink the green light to build a citywide Wi-Fi network, the grand plan to deliver ubiquitous broadband to tourists, residents, businesses, government workers and low-income households is in shambles.

Read Wireless Philadelphia's take on the project.
See more analysis of municipal wireless efforts.

Between unanticipated technical challenges and a flawed business model, the project is over budget and under performing. According to sources, only 3,000 residential customers have signed up – a paltry 1% penetration rate.

EarthLink, faced with similar problems elsewhere, announced last month it plans to sell off its entire muni Wi-Fi business. It's unclear whether Earthlink, which declined our request for comment and failed to appear at a recent City Council meeting, will ever finish the 80%-completed network.

After EarthLink announced last fall that it was seeking "strategic alternatives" for its municipal Wi-Fi business, the company drastically scaled back its efforts in Philadelphia. EarthLink has been tuning the existing coverage area, but it has left the northeast and northwest areas without service. The city maintains that even if the public-access business model falls flat, Philadelphia's 3,000 mobile city workers can use the network. However, in its current condition the network isn't much good to city workers because coverage is so spotty.

"What EarthLink has accomplished in the past couple of years is underwhelming," says Philadelphia Councilman-at-large Frank S. Rizzo. "I wish it were otherwise, but there is not much to be excited about yet."

No brotherly love

When Network World first reported on Philly's Wi-Fi efforts in August, EarthLink was enthusiastically building out the network, nailing up Tropos access points on light poles and shooting for blanket coverage of the city's 135-square miles by last fall. The plan was to tune the network and have the city approve the buildout by year-end.

Click to see: Map of EarthLink's coverage area

The first sign of technical and financial trouble came when EarthLink realized it needed to double the density of access points from an initial estimate of 20 per square mile to an average of 42 per square mile.

Even at the more costly 42 access points per square mile, EarthLink couldn't deliver in-building Wi-Fi without an additional CPE device that residential customers had to either buy or lease. EarthLink recently added new firmware modules to the client-side signal boosters, which improved reception to some degree, but the network is far from delivering the kind of service that the city expected.