8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): March 3, 2005

Internet America, Inc.

(Exact name of registrant as specified in its charter)

Texas	000-25147	86-0778979
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

One Dallas Center

350 N. St. Paul Street

Suite 3000

Dallas, Texas 75201

(Address, including zip code, of principal executive offices)

Registrant’s telephone number, including area code: (214) 861-2500

Not applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.05. Costs Associated With Exit or Disposal Activities

Pursuant to action taken March 3, 2005, the Board of Directors of Internet America, Inc. (the “Company”) authorized the Company to effect a reduction in workforce plan (the “RIF”) aimed at both reducing the corporate expense structure and to better position the Company to pursue its growth plans for the rural wireless Internet market. The RIF was carried out by Company management on March 4, 2005, resulting in an approximate 17% reduction in the Company’s workforce.

The Company expects to incur one-time termination benefits, consisting of severance payments and related payroll taxes, of approximately $83,000.

Item 9.01 Financial Statements and Exhibits

Exhibits:

99.1 Press Release Dated March 7, 2005

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	INTERNET AMERICA, INC.
Date: March 7, 2005	By:	/s/William E. Ladin, Jr.
		William E. Ladin, Jr. President and Chief Executive Officer

INDEX TO EXHIBITS

Item Number	Exhibit
99.1	Press Release dated March 7, 2005, announcing the workforce reduction.

EX-99.1

EXHIBIT 99.1

CONTACT
Internet America, Inc.	March 7, 2005
214.861.2500
investor.relations@airmail.net

Internet America announces workforce reduction; Move aims to further

align company to pursue rural wireless Internet market

Dallas, March 7, 2005–Internet America (OTC Bulletin Board: GEEK—News), a leading Internet services provider, today announced a reduction in its current workforce of approximately 17% effective March 4, 2005. This reduction was aimed at both reducing the corporate expense structure and to better position the company to pursue its growth plans for the rural wireless Internet market.

“While we expect to take a charge to earnings in the current quarter of approximately $83,000, we anticipate an annual savings in wages and benefits of approximately $1.0 million. We feel that this reduction will allow us to continue to grow our business and earnings in future quarters,” said Billy Ladin, Chairman and CEO of Internet America.

Ladin continued, “This reduction in workforce will allow us to more efficiently pursue our growth and acquisition plans in the rural markets. By consolidating resources and simplifying operations of our wireless Internet access business, we feel that we will be better positioned to execute our strategy of acquiring dial-up Internet customers and growing our wireless Internet operations.”

About Internet America

Internet America is a leading Internet service provider primarily serving the Texas market. Based in Dallas, 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 Fax2email, online backup and storage solutions, parental control software, 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

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 provide our subscribers with access to broadband fast enough to grow our subscriber base, including DSL and commercial services customers, (2) we will not improve EBITDA, profitability or product margins, (3) we will not continue to achieve operating efficiencies, (4) we will not be competitive with existing or new competitors, (5) we will not keep up with industry pricing or technological developments impacting the Internet, (6) needed financing will not be available to us if and as needed, and (7) we will be adversely affected by dependence on network infrastructure, telecommunications providers and other vendors, by regulatory changes and by general economic and business conditions. These risk factors are not intended to represent a complete list of all risks and uncertainties in the Company’s business and should be read in conjunction with the more detailed cautionary statements included in the Company’s most recent SEC filings.