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Today's report from Web Editor
Susan Rush
• DSL.net Slashes Jobs
• NorthPoint Ponders Lawsuit
• POV: Cisco's John Chambers Speaks
• Broadband Briefs
• Next Week In Broadband
DSL.net Slashes Jobs
High-speed Internet provider DSL.net Inc.
will cut its workforce by 28 percent as part of a restructuring plan to reduce spending and "extend the timeframe the company needs to raise additional capital." The deletion of the 141 employees from the payroll is expected to save the company $8 million in fiscal 2001. The company will incur a one-time restructuring charge of no more than $1 million.
"The decision to reduce the workforce was made in conjunction with our decision to slow down the deployment of our network into new territories, and then focus on continued revenue growth..." says Keith Markley, president and CEO of DSL.net. Since joining the company in November, Markley has focused his efforts on improving the efficiency of the company. "The actions we are taking are designed to proactively prevent the financial difficulties other Internet-based companies are experiencing in today's market climate," he continues.
DSL.net's actions were seen as proactive on Wall Street today, the company's stock price shot up 35.2 percent to $1.44 during this morning's trading. Despite the jump, the company is still teetering close to its 52-week low of 93 cents.
Related Story:
Broadband Battle: DSL vs. Cable, Broadband Week, 9/00
NorthPoint Ponders Lawsuit
All rise, court may soon be in session. NorthPoint Communications Group Inc.
is reportedly considering taking legal action against Verizon Communications Inc.'s
decision earlier this week to nix its buy in a controlling stake in the company.
As BroadbandWeek Direct reported yesterday, Verizon said that "the material adverse changes" at NorthPoint prompted the termination of the agreement as permitted under the terms of the contract. NorthPoint disagrees. "We do not believe that Verizon is entitled to terminate the merger agreement nor its agreement to provide interim financing," said Elizabeth Fetter, NorthPoint's president and CEO during a conference call. Fetter would not comment on possible future legal actions against Verizon.
To help fund the fight, NorthPoint is reportedly talking with creditors about gaining access to $165 million in already pledged bank credit, according to a Wall Street Journal report.
NorthPoint's stock was trading at 53 cents a share this morning; Verizon shares were trading at $56.
Related Stories:
NorthPoint's Stock Tanks, BroadbandWeek Direct, 11/30/00
NorthPoint's Stock Drops, BroadbandWeek Direct, 11/20/00
The Latest News From The Western Show:
POV: Cisco's John Chambers Speaks
Cisco Systems Inc.
CEO John Chambers sees a market where the broadband connection is merely the ante and the real game is in execution and services.
In a private session with trade journalists Thursday - away from the clamor of the Western Cable Show floor, Chambers emphasizes the winners in the volatile broadband Internet game will be those that get to market early and don't get caught behind the commoditization curve. Such is the case for long-distance voice service and shortly, high-speed data as well, he says. And while cable networks may have the early market lead, they will only win the battle against telephony competitors if that commoditization process moves quickly.
"What will be interesting is the how long people need to have time to make the transition," he says. "I personally think that if it happens rapidly, the cable players have a much higher probability getting margin market share."
Two to three years is the window," he adds. "If the cable company doesn't have the market share in two to three years they are going to have a real challenge from the ILECs. They have deeper pockets, they have more of the branding and customer touch."
"It's a perfect jump ball. Technology and conversion wise there is no difference between an ADSL implementation and a cable implementation - and probably wireless," he adds. "It comes down to who executes the best."
Broadband Briefs:
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It's official, a $9.8 billion investment gives NTT DoCoMo
a 16 percent stake in AT&T Wireless. As part of the deal, the duo will jointly develop high-speed wireless services.
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360networks plans to develop metro rings in 35 major cities by the middle of next year. The company is targeting cities in North America, Europe, South America and Asia.
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Microsoft Corp. has signed a memorandum of understanding with Octal, a group of system engineers in Portugal, to develop a prototype advanced set-top box for European digital video broadcasting and North American cable set-top box markets.
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California state regulators are investigating Qwest Communications International Inc.
for unlawful sales practices. The California Public Utilities Commission says it has received more than 40,000 complaints against the company between January and May of this year. Qwest says it already fired the company it believes was responsible for the problems earlier this year and will work with the state during the investigation.
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HighSpeed Surfing Inc.
launches a wireless home networking solution at the Western Cable Show in Los Angeles. The 11 Mbps wireless networking hub supports Windows 95/98/2000/NT.
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ExtremeSports.com will provide its adrenaline-packed sports clips over
Ecast Inc.'s broadband network. The two-minute streaming video clips will feature extreme sports, including surfing, snowboarding and
BMX.
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Entel Bolivia teams with STM Wireless Inc.
to deliver broadband Internet services to business customers in Bolivia and other select Latin American countries.
Next Week In Broadband
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