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Net Wreckage
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from the January 8, 2001 issue of Broadband Week
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The carnage in the competitive digital subscriber line market continues. Here are a few of the more notable recent setbacks and flameouts:
- Struggling DSL ISP Telocity was snapped up by Hughes Electronics for a $180 million. The Cupertino, Calif.-based company has itself been taking on residential customers whose service providers have failed, such as Phoenix Networks and Flashcom.
- Flashcom let go 105 of its 360 employees, started selling off parts of its customer base and is in Chapter 11. It forged deals with resellers Rhythms NetConnections and NorthPoint Communications to transfer over about 7,000 customers and is working on a similar deal with reseller Covad Communications Inc. Rhythms will reconnect customers to Earthlink, while NorthPoint will turn over its customers to Telocity.
- Digital Broadband Inc. let go most of its workers and then filed for Chapter 11 bankruptcy protection. The New England ISP claims about 1,000 customers in Massachusetts, New Hampshire, Rhode Island, Connecticut, New York, Pennsylvania and Maryland.
- Zyan Communications Inc. filed for Chapter 11 and laid off about 160 of its 230 employees. Primarily a business ISP claiming 17,000 clients nationwide, Zyan will continue supporting its existing customer base while it restructures its debt and operations.
- Seattle-based Bazillion bailed out of the DSL game altogether after Covad terminated its service agreement. The company plans to refocus its efforts on voice service and messaging.
- HarvardNet also bailed out of the DSL game to focus on Web hosting and managed services. The East Coast network operator axed 280 jobs in the restructuring, which company officials blamed on the souring financial market for DSL.
- DSL.net Inc. cut its workforce by 141 employees to help curb costs in the coming year.
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