Posted on 11/30/2001 1:22:42 PM PST by John Jorsett
A federal bankruptcy court judge in San Francisco today said that the broadband network of Excite@Home will be shutdown on Friday at midnight PST (3:00 AM EST) if a deal with its cable partners and creditors is not reached, sources at the proceedings tell Dotcom Scoop.
Excite@Home has the right under the ruling to renogiate its Master Distribution Agreements with its cable partners and with the approval of creditors, according to published reports. Excite@Home said it is losing $6 million per week keeping the network operational.
Judge Thomas Carlson said he felt that a deal could be reached quickly so that service would not be interrupted. Excite@Home representatives are currently negotiating new operating agreements with cable partners, which creditors must approve, according to the Associated Press.
The decision could affect approximately 4.1 million cable Internet access subscribers using @Home's service through partners such as AT&T, Charter Communications, Comcast and Cox.
If the network is shutdown, AT&T will attempt to migrate customers to its own existing network. Cox is in the process of finishing work on its network, but indications are that customers won't be moved until next year. Comcast is also in the process of building its own network, but there is no timetable for customers to be moved. Both Cox and Comcast have suggested that subscribers use free ISP NetZero as an alternative.
At the heart of the argument was a bondholders motion which asked that the court re-evaluate Excite@Home's broadband assets, which are set to be acquired by AT&T for $307 million. Owed almost $750 million, bondholders contended that the value of the assets is more than AT&T is offering and that fair value could only be known if the network was shutdown and cable partners were forced to find alternative providers. Today's ruling is a clear victory for bondholders.
Dotcom Scoop first reported about the possible shutdown on Nov. 8.
For the first time in my life, I want to sue somebody!
Sure, I'll give them my phone number and address. Yup.
I have ATT Broadband in Massachusetts, and they say today that there will not be a connectivity or e-mail problem as a result of this pending action. It will only affect ATT Broadband customers with a excite@home webpage, which will not be accessable for a while.
We will find out soon enough. Actual mileage may vary.
I guess that special rate is cancelled, huh?
And here I was, planning to fish ethernet cable this weekend..... :o(
No seriously, this sucks for @home customers. I lost a bundle investing in their stupid money-losing company. Luckily I sold it before it really crashed! Bad management, bad negotiating, and they set themselves up for this defeat. The worst thing is that AT&T thinks they can scoop it up cheap... but this has destroyed the reputation for cable all across the land. It could have been a much better service than DSL but they were way too slow to roll it out, way too slow with the self-install kits, way behind on the technology. In the ideal world Cable would've killed DSL, but they didn't attract the corporate customers or serious users (no dedicated IP, no servers, no networking) and they wouldn't guarantee a minimum speed (theoretically it could've killed DSL in bandwidth but they didn't want to invest in it).
Besides, don't you think it would be unsightly for you to be roaming the streets with a sign that says "WILL WORK FOR INTERNET ACCESS?"
http://www.dotcomscoop.com/athm.html
""Are they afraid of AT&T?" said one shareholder. "Why hasn't there been an expose in The Wall St. Journal or the New York Times?""
"I think there is a huge story here. I personally think, and have written for months, that AT&T purposely drove Excite@Home into bankruptcy. I think that AT&T, Comcast and Cox have conspired to doom the company in an effort to relieve themselves of further write downs associated with their investments and to acquire the @Home broadband customer base."
"Excite@Home should have been positioned to be an amazingly successfully company; but it will simply disappear."
"Billions of dollars have been squandered and there are thousands of people waiting for these questions to be answered."
"This is not another stupid dotcom crashing and burning. This is not Pets.com, Kozmo.com or Webvan. This is a company that has no excuse for not being successful."
"And cash is an interesting issue for Excite@Home. The company's Chapter 11 bankruptcy issurprising considering the company appears to be cash flow positive now thanks to hastily renegotiated terms with AT&T, Comcast and Cox. The simple fact seems that Excite@Home could sell its media assets and operate as a profitable company within eighteen months."
"The moves by AT&T and Cox has caused more legal wrangling. Brian Lewis, an Excite@Home shareholder and lawyer, has filed a motion with the bankruptcy court seeking the asset sale to be blocked. Lewis argues that AT&T and Cox have breached agreements with Excite@Home by building their own networks."
"Fraud accusations are flying. Checks are bouncing. Customers are being threatened with service disruptions. The clouds surrounding Excite@Home grow darker each day and many close to the situation wonder whether the media will be able to expose the true story before it's too late and whether the government will investigate what some are calling the Fraud of the New Economy."
"Rarely do I ever scrutinize a company like I have Excite@Home. But rarely do sources from so many points of view, from so many backgrounds and so many levels, come out of the woodwork to rat on a company. Something that can best be described as "business terrorism" has taken place here. If I am wrong, then all the evidence is a sick coincidence."
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