Some of us spend too much time online, and EarthLink is OK with that. The company provides Internet connections to about 800,000 consumers and thousands of businesses in the US. It also offers such services as VoIP computer telephony and Web hosting. EarthLink provides broadband access over cable lines through agreements with network operators including
Time Warner Cable
, while DSL and dial-up connections are made possible over phone lines owned by
, among others. The company's enterprise segment implements and manages private data networks. EarthLink agreed to be acquired by
for $1.1 billion in 2016.
The company operates in four segments - enterprise and mid-market, small business, carrier/transport, and consumer services. The company's enterprise/mid-market customers account for 41% of revenue, followed by small business, 27%, consumer, 20%, and carrier/transport, 12%.
EarthLink serves residential and business customers nationwide.
Sales and Marketing
The company scouts for new business customers through direct, inside, and independent sales channels, such as resellers and IT consulting firms. It doesn't use a dedicated sales force for residential customers; they're targeted through call centers, online ads, and resellers such as Time Warner Cable and Dish Network.
EarthLink is reducing its direct sales presence in smaller markets to focus on larger geographic areas in order to accelerate its transition into an managed services provider.
EarthLink maintained revenue of more than $1 billion in 2015 for the fifth year in a row, but it is getting increasingly close to nine-figure territory. It reported $1.1 billion in revenue in 2015, down from $1.8 billion in 2014. Several factors have conspired to cut EarthLink's business-related revenue including competition, customer migration to more advanced services, and regulatory rules that reduced intercarrier compensation. The company is losing consumer customers as some switch to other providers or go without access. It has lost some 250,000 consumer subscribers over the last two years.
While EarthLink's revenue was down in 2015, it posted less of a loss ($43 million), compared to the loss for 2014 ($72 million) because it cut costs in several areas.
EarthLink's growth plan involves becoming a provider of managed network, security, and cloud services for businesses with multiple locations. In 2016, the company sold some of its IT services assets to Synoptek for $29 million. The move helps Earthlink focus more narrowly on managed services and more resources with which to do so. The company is investing capital to extend its core fiber IP network, adding data centers, and decreasing investments in legacy products. It could spend as much as $105 million on capital projects in 2016, up from $87.5 million in 2015.
Mergers and Acquisitions
EarthLink's last significant acquisition was in 2013 EarthLink, when it bought
for $22 million and added CenterBeam's remote managed IT services and help desk capabilities to its EarthLink Business division.