HOUSTON--(Business Wire)--
Internet America, Inc. (OTCBB: GEEK) today announced preliminary unaudited
operating results for the fiscal fourth quarter and the fiscal year ended June
30, 2010. Total revenues for the fiscal year decreased by 4.6% to approximately
$7,419,785, compared to total revenues of approximately $7,782,982 for the
fiscal year ending June 30, 2009. Revenues for the fourth fiscal quarter ending
June 30th of 2010 increased slightly to $1,873,796 compared to $1,866,740 for
the fourth fiscal quarter ending June 30th of 2009.

Adjusted EBITDA (earnings before interest, taxes, stock based compensation, and
depreciation and amortization) for the fiscal year ending June 30, 2010 was
approximately $158,000 compared to adjusted negative EBITDA of approximately
($387,000) in the fiscal year 2009. Adjusted EBITDA was approximately $239,000
in the fourth quarter of fiscal 2010 compared to adjusted negative EBITDA of
approximately ($194,000) in the fourth quarter of last fiscal year. Net loss and
adjusted EBITDA were positively impacted in fiscal 2010 by continued reductions
in costs associated with connectivity and operations and general and
administrative expenses. The Company expects to report final audited results
around the end of September 2010 in connection with the filing of its annual
report on Form 10-K with the Securities and Exchange Commission.

Billy Ladin, Chairman and CEO, said, "We are pleased with our earnings progress
over the last fiscal year and particularly the last quarter, and we believe that
our EBITDA profitability will continue and possibly improve over the foreseeable
future. During the fourth fiscal quarter, we elevated three experienced managers
to Vice Presidents, returned over 90% of the employees whose salaries had been
reduced as part of the salary reduction plan that began in January to their full
compensation levels, and turned our major focus to top line growth. While we are
now more focused on revenues, we do not intend to take our eyes off of our goal
to improve profitability."

Internet America is a leading Internet service provider serving the Texas
market. Based in Houston, Internet America offers businesses and individuals a
wide array of Internet services including broadband Internet delivered
wirelessly and over DSL, dedicated high-speed access, web hosting, and dial-up
Internet access. Internet America provides customers a wide range of related
value-added services, including Fax-2-Email, VoIP, desktop video conferencing,
online backup and storage solutions, and global roaming solutions. Internet
America focuses on the speed and quality of its Internet services and its
commitment to providing excellent customer care. Additional information on
Internet America is available on the Company`s web site at
http://www.internetamerica.com.

In this press release, the Company refers to a non-GAAP financial measure called
adjusted EBITDA because of management`s belief that this measure is a financial
indicator of the Company`s ability to internally generate operating funds.
Management also believes that this non-GAAP financial measure is useful
information to investors because it is widely used by professional research
analysts in the valuation and investment recommendations of companies in the
Company`s peer group. Adjusted EBITDA should not be considered an alternative to
net income, as defined by GAAP.

This press release may contain forward-looking statements relating to future
business expectations. These statements, specifically including management`s
beliefs, expectations and goals, are subject to many uncertainties that exist in
Internet America`s operations and business environment. Business plans may
change, and actual results may differ materially as a result of a number of risk
factors. These risks include, without limitation, that (1) we will not be able
to increase our rural customer base at the expected rate, (2) we will not
improve adjusted EBITDA, profitability or product margins, (3) we will not form
additional partnerships with public entities seeking to participate in grant
programs or those partnerships may not be successful, (4) we will not expand our
coverage in public-private partnerships with state or local governments, utility
providers, or other entities, (5) Internet revenue in high-speed broadband will
continue to increase at a slower pace than the decrease in other Internet
services resulting in greater operating losses in future periods, (6) financing
will not be available to us if and as needed, (7) we will not be competitive
with existing or new competitors, (8) we will not keep up with industry pricing
or technological developments impacting the Internet, (9) we will be adversely
affected by dependence on network infrastructure, telecommunications providers
and other vendors or by regulatory changes, (10) service interruptions or
impediments could harm our business, (11) we may be accused of infringing upon
the intellectual property rights of third parties, which is costly to defend and
could limit our ability to use certain technologies in the future, (12)
government regulations could force us to change our business practices, (13) we
may be unable to hire and retain qualified personnel, including our key
executive officers, (14) future acquisitions of wireless broadband Internet
customers and infrastructure may not be available on attractive terms, and if
available we may not successfully integrate those acquisitions into our
operations, (15) provisions in our certificate of incorporation, bylaws and
shareholder rights plan could limit our share price and delay a change of
management, and (16) our stock price has been volatile historically and may
continue to be volatile. These factors are not intended to represent a complete
list of all risks and uncertainties inherent in our business, and should be read
in conjunction with the more detailed cautionary statements included in our
other publicly filed reports and documents.

Internet America, Inc.
William E. Ladin, Jr., 713.968.2500
investor.relations@airmail.net

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