Investors picking up wireless Internet plan

Citywide wireless Internet service, born in a swelling of municipal pride three years ago but left for dead just last month, was reborn yesterday.

And now it will be free.

A group of six local investors, including former mayoral candidate Tom Knox, closed a deal Monday after three weeks of negotiating to take over the wireless network created by EarthLink.

Where EarthLink stumbled - its subscription service often failed to penetrate buildings and reach customers - the new owners see an opportunity.

The investors, known as Network Acquisition Company LLC until they choose a better name, plan to create a wired Internet network for paying corporate clients such as hospitals, universities, companies and, perhaps, the city. That network will be connected with the existing wireless system, which will be free to use anywhere the signal can be received. The wired network will enhance and extend the wireless network.

EarthLink's network now covers about 80 percent of the city. Investor Mark Rupp said that his group will improve the technology of the network and finish building it so that it covers the entire city.

Rupp and fellow investor Derek Pew, who will lead the company, are directors of Boathouse Communications Partners. Their group also includes Rick Rasansky, who has started several software and telecommunications companies; David Hanna, chairman of Tropos Networks, which works on wireless Internet networks; and Donald Callaghan, of Hirtle, Callaghan & Co., an investment service firm.

Wireless Philadelphia, the non-profit set up in 2005 when then-Mayor John Street's administration negotiated the contract with EarthLink, will continue to work on "digital inclusion" efforts to increase access to the Internet for all city residents.

Mayor Nutter thanked his staff and City Councilman Bill Green for working "tirelessly" on the negotiations with the investors.

"This is a valuable asset being retained here in our city," said Nutter, adding that he had sought a free citywide service not funded with tax dollars. "We accomplished all those goals."

EarthLink sued the city last month, asking a federal judge for permission to dismantle the network, which it valued at $17 million. The company said that it was losing up to $200,000 a month in Philadelphia on a service that was expected to draw more than 100,000 customers but had signed up less then 6,000.

Rupp said that the wireless network will be free to registered users while the investors spend months examining and stabilizing it.

"The way you were able to use it before today, you will be able to use it right now," Rupp said. "It is free as of today." *