EARTHLINK: Long CEO search ends
EarthLink named a new president and CEO Monday, ending a long search to replace a top executive who died in January.

The Internet service provider turned to outsider Rolla P. Huff, ex-chairman and CEO of Mpower Communications, rather than hiring from within. Huff replaces interim EarthLink Chief Executive Mike Lunsford, who remains with the company as executive vice president.

Lunsford led EarthLink on a temporary basis starting in late 2006, when former President and CEO Garry Betty stepped down. Betty, who was diagnosed with cancer, died in early January at 49.

Huff joins EarthLink amid many challenges. The company lost about $30 million in the first quarter.

"I'm coming in truly with no preconceived notions of what we will or will not do," he said in an interview. "I'm going to spend the next 60 to 90 days getting into each of the various business units."

The learning process already is under way. Huff said he's using an Ocean cellphone from Helio, a joint venture of EarthLink and SK Telecom of South Korea. He plans to visit Anaheim, Calif., next week to personally test the company's fledgling municipal wireless Internet system.

EarthLink, which is best known for providing dial-up Internet service, has been trying to diversify because dial-up is on the wane. So far, the company has reported few tangible results for some of its investments. Robert Kavner, EarthLink's chairman, said in a prepared statement that Huff has the "experience and strategic acumen" to improve the company's share price.

EarthLink shares climbed 6 cents Monday to close at $7.31. However, shares are down about 11 percent compared with a year ago.

Before being named president and CEO, Huff purchased 100,000 shares of EarthLink stock. Huff said he expects to make money on the investment and that the purchase wasn't meant to simply show support.

"I wish I had enough money that I could throw that much around as a gesture of confidence," he joked.

EarthLink also granted Huff 100,000 shares of restricted stock and 1.5 million stock options. He'll be paid a base salary of $750,000 per year, plus a bonus that will vary depending on EarthLink's performance. Huff, 50, has a three-year employment contract.

Huff has worked at many companies. At the old AT&T, he was financial vice president in the corporate mergers and acquisitions group. After that, he served as chief financial officer for the former AT&T Wireless from 1995-97. He then joined Frontier Communications and played a key role in the company's merger with Global Crossing.

Most recently, Huff led Rochester, N.Y.-based Mpower. The company —- a provider of telecommunications services to business customers in California, Las Vegas and Chicago —- was sold to TelePacific Communications in 2006. Huff led Mpower from 1999 until its sale.

While EarthLink faces many challenges, Huff said the company's core business in providing Internet access continues to yield ample cash. "The balance sheet is still very strong," he said.

EarthLink also has a good brand the company can take advantage of, Huff said. "It may be dial-up, but people like the EarthLink brand," he said. "They have an affection for it."

Huff, a graduate of Purdue University in Indiana, was appointed to EarthLink's board of directors and to Helio's board. Helio is one of EarthLink's biggest financial bets. EarthLink expects to lose $110 million to $140 million this year, chiefly because of costs connected to Helio.

Sky Dayton, EarthLink's founder and CEO of Helio, said in prepared statement that Huff is a "proven leader."

"I think he is the perfect CEO to have at the helm during this very important time in EarthLink's history," Dayton said.