SF Muni Project on the Ropes

San Francisco is putting free municipal WiFi access to the ballot in a move intended to give the citizens of the city by the bay the final say on whether they want the service.

What is unclear, however, if the voters approve such a blue-sky proposal, is what company would build the network. The city's current deal with EarthLink Inc. (Nasdaq: ELNK) appears to have hit some serious snags that could be difficult to resolve.

San Francisco legislators want to reduce the length of EarthLink's current contract from 16 to eight years and get the company to add more privacy restrictions to the network service.

A spokesperson for EarthLink says that the company wants more time to mull over the changes. "We are still reviewing the suggested changes... We asked for one month to do a review last week."

Meanwhile, EarthLink's new CEO, Rolla Huff, said on the company's second quarter earnings call recently that the company wouldn't be pursuing anymore municipal deals until it has figured out how to make money from muni wireless. (See Criticism Mounts in SF Muni Deal and What's Muni Wireless Good For?.)

So, the San Francisco vote may not mean much of anything at all. "The November ballot asks voters whether they support establishing free wireless Internet access in San Francisco," notes municipal networking consultant and author of Fighting the Good Fight for Municipal Wireless, Craig Settles. "This is akin to asking voters if they support world peace."

Google (Nasdaq: GOOG) -- EarthLink's largely silent partner in the San Francisco experiment -- has always lauded free municipal WiFi as a way to extend the reach of the internet in the city and beyond.

The search giant, however, has so far been quiet about the latest hurdles for the potential muni mesh. Spokespeople for the search giant haven't yet responded to requests for comment from Unstrung.

— Dan Jones, Site Editor, Unstrung