EarthLink’s biggest cut of all

Update and Analysis: Don Berryman, EarthLink’s top municipal wireless executive, is out of a job. So are 899 other EarthLink employees amid a massive company reorganization. The shake-up includes office closings in cities that EarthLink had been targeting for public broadband deployments. The upshot for municipal leaders: Our collective focus is moving from big, feel-good public access efforts to government applications that deliver ROI.

First, the situation at EarthLink. An EarthLink press release about the layoffs and company reorganization made no mention of Berryman’s status. But in an SEC filing today EarthLink stated “the position of Executive Vice President and President-Municipal Networks, held by Donald B. Berryman, is being eliminated and Mr. Berryman’s employment with the Company is terminating.”

The moves come only a few weeks after new EarthLink CEO Rolla Huff promised swift decisions about the company’s municipal wireless business. In addition to the layoffs, EarthLink is closing offices in key locations — such as San Francisco, which has suffered its share of public broadband setbacks.

In a prepared statement, CEO Huff today said EarthLink will continue to make announcements about its business strategy in the weeks ahead. The elimination of key EarthLink offices and Berryman’s position have prompted speculation that Huff plans to shut down or greatly scale back EarthLink’s public wireless initiatives.

New Focus

Although some cities may face considerable short-term pain, EarthLink’s reorganization may be the reality check that the municipal broadband market needs.

Too many municipalities continue to focus on large, ambitious public wireless projects that have no clear path to profitability. The latest example: Long Island’s Nassau and Suffolk counties are embarking on a public broadband effort with an untested integrator.

In stark contrast, the most successful municipal broadband projects typically involve a municipal department (police, public works, etc.) deploying a key application (public safety, video surveillance, automated meter reading, etc.) that delivers a clear return on investment. Corpus Christi (Texas), Buffalo (Minn.), Phoenix (Ariz.) and Providence (R.I.) and many other cities have thriving municipal broadband networks running government applications.

Once a municipality succeeds with an application deployment, it’s far easier to build a case to offer limited or comprehensive public broadband access.