Illinois says Gigabit Squared lied repeatedly, wants $2 million back

Once upon a time, it was strictly formal dress for sunrise.

The company that sold magically cheap fiber and a business case built on fairy dust to Seattle, then left town owing fifty grand is in even bigger trouble in Chicago. The state of Illinois gave Gigabit Squared a $2 million grant to deploy “ultra high speed” Internet access on the city’s south side and, to say the least, isn’t seeing results, according to a story in the Chicago Sun-Times (h/t to the Baller-Herbst list for the pointer)…

Gigabit Squared, a Cincinnati-based company that last May touted the high-speed project in nine South Side communities, “has lied repeatedly” about its intentions and may have spent only $250,000 of the grant money for legitimate purposes, said David Roeder, spokesman for the Illinois Department of Commerce and Economic Opportunity, which issued the grant.

To clear the air the state is inviting Gigabit Squared to an “informal hearing”, which in Chicago-speak is the semantic equivalent of a casual firing squad. The company has until 10 April to RSVP. So far, no direct reply, but the Sun-Times article includes a statement from Gigabit Squared that’s a wonderful mix of disingenuity and bewilderment. Translation: the dog ate the paperwork.

I’m not close enough to either the Seattle or the Chicago project to speculate on whether the failures were the product of ignorant and incompetent management or premeditated fraud or something else. Whatever the reason, the result is a couple of bloody black eyes for legitimate municipal broadband advocates, which is not helpful to our cause. My advice to cities approached by broadband rainmakers beating a drum: if it sounds too good to be true, it is.