Per a story we ran a while back about Earthlink shutting down Philadelphia's municipal Wi-Fi network, the situation has changed. According to Macworld News, the city's mayor announced on Tuesday that the effort has been saved by a group of private investors.

The investors, who will finish building the network throughout the city, plan to work with non-profit organizations including Wireless Philadelphia to offer services to people without Internet access. The new company has stated plans to contract with several enterprise and municipal customers who will become anchor users of a paid service. In addition, the group will offer free services to the general public.

The group has modeled its idea on other successful municipal Wi-Fi ventures according to Craig Settles, an independent consultant who has been in close contact with parties involved in the new arrangement. In Fredericton, New Brunswick, Canada, for example, the network provider partnered with 12 businesses to commission the network. The business users pay for access while citizens can use the network for free.

"Philadelphia’s medical community and universities are obvious possibilities for anchor customers in addition to city organizations," Settles said.

“Despite all that has gone on with Philly and their network, I still expect the city to join the ranks of successful muni network projects,” he said.

The investor group has stated plans to use advertising to help support the free service. In addition, the group also expects to offer wired service to its customers.

Philadelphia’s municipal Wi-Fi network is notable because it was one of the first announced, and it once was expected to be the nation’s largest municipal Wi-Fi network. The plan drew fire from Verizon, which charged that it was unfair to use tax dollars to build a network that would compete with private providers.

Eventually, EarthLink won a contract to build a network at no cost to taxpayers. Unfortunately, the company ran into financial difficulties and dramatically scaled back its Wi-Fi projects. Just last month, EarthLink announced it would shut down the Philadelphia network that it had already built after failing to come to an agreement with city and nonprofit groups that had hoped to keep the network running.

The history of municipal Wi-Fi networks across the country has followed a similar course of highs and lows. Despite excitement around the concept of municipal Wi-Fi, networks have often been built around shaky plans for funding operations. Some cities have since shut down their networks entirely while others, like Philadelphia, continue to work on new business models that could support municipal Wi-Fi networks that include some free services for citizens.

If you've seen the Wi-Fi network in action or can offer a Philly-based perspective on this, please let us know in the comments or forums.