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Latest News

@Home Can End Service

by Maarten Goldstein, Nov 30, 2001 1:03pm PST
Related Topics – Bankruptcy

A judge has cleared the way for Excite@Home to shut down its Internet service, according to MSNBC (thanks SatansFist). In fact @Home could end its service as soon as late tonight which might affect some 4 million people. Of course, cable companies which use @Home's network and have not found a replacement network yet, are appealing the decision.

Bankruptcy Judge Thomas Carlson said Redwood City-based ExciteAtHome could reject its existing contracts with the cable companies as early as 3 a.m. EST Saturday, when their contracts expire. Carlson gave ExciteAtHome the leeway to end the contracts after concluding they had become “clearly burdensome” to the company. Under the contracts, ExciteAtHome executives said the company was losing up to $6 million per week.
This news story on CNet paints a somewhat different picture about the situation, and makes it appear less likely that service will actually be shut off.




Comments

55 Threads | 145 Comments












  • Some bits from CNet (http://news.cnet.com/news/0-1004-200-8031722.html):

    "Despite threats from the cable companies, Carlson and numerous attorneys for bondholders and unsecured creditors said that shutting off service was highly unlikely--chiefly because such a move would be detrimental to all parties involved. Excite@Home and various cable partners, including AT&T Broadband, Cox Communications and Comcast, share infrastructure and content, and the companies split revenue that comes from paying subscribers."

    "But attorneys for bondholders and unsecured creditors said the cable companies' protestations are nothing but idle threats--an attempt to hang onto lucrative contracts without having to renegotiate them at potentially less favorable rates."

    "Even the cable companies say that the odds of a shutdown are slim. Cox Communications and Excite@Home executives were busy trying to negotiate contracts on Friday afternoon, in an attempt to "do everything possible to avoid an outage." "

    "Sources close to the deal said few of those involved in the talks really want a shutdown of Excite@Home, and some bondholders are willing to accept bids even marginally more than $307 million. "



    So clearly, there have to be new contracts, and that's all. Excite@home needs more revenue, and the cable companies have to share a little more of that huge pie.

    My prediction? Nothing is going to happen in terms of service disruption. It would mean a very big blow to the cable networks.

    booyaka