December 3, 2001
Not long ago, cable companies were touting high-speed Internet access as the service that would make them indispensable. That was before the bankruptcy of Excite@Home, whose collapse left 850,000 consumers without Internet access today and more than three million others dangling uncertainly.
Excite@Home furnishes "back-end" services to cable companies, providing the connectivity to the Internet that cable companies then passed on to their end users. Its customers include the largest cable companies -- AT&T, Cox Communications and Comcast.
Beyond connectivity, Excite@Home also operates the servers that provided email and personal Web pages to cable customers. Its collapse means that, even when connectivity is restored, customers will need to switch to new email addresses and will have to rebuild their Web pages.
Those hit hardest and fastest are about 850,000 AT&T customers whose service was shut off Saturday after AT&T refused to meet demands for a reported $100 million to maintain the service. AT&T is building its own network and says it will have most of its customers back in service within 10 days. Fewer than 100,000 in Vancouver and Washington State have already been connected to the new service.
The fate of Comcast and Cox customers remains uncertain. Both companies are negotiating with Excite@Home and its creditors, who are basically calling the shots. Comcast and Cox are both building new networks but they won't be ready until next June. Unless an agreement is reached, those customers could be without service for at least seven months.
AT&T has been trying to buy Excite@Home. Its latest reported offer was $307 million but that was rejected by the company's creditors, who are owed $1.3 billion. Excite went to court Friday and won a judge's permission to shut down rather than continue losing hundreds of thousands of dollars a day, leaving consumers in the lurch.
Not all AT&T, Comcast and Cox customers are threatened since some are served by Road Runner, an AOL TimeWarner venture, and MediaOne, a cable venture previously purchased by AT&T.
What Can Consumers Do?
Unfortunately, there's not much individual cable customers can do, other than go back to dial-up service. Since cable modem service is up to 100 times faster, that's quite a blow for those who use their home computers for work. Telephone companies provide high-speed digital subscriber line (DSL) service but it is not available everywhere and installation can take weeks or even months in many areas.
