US cable operator Cox Communications is in the process of setting up its own high-speed internet network in an attempt to end its dependence on bankrupt broadband provider Excite@Home.
Cox has around 550,000 customers signed up to its lucrative web access service, supplied by Excite. At some point next year, these subscribers will be shifted onto the new network, which will cost around $150 million to set up.
On filing for bankruptcy protection recently, Excite vowed to continue its services [WAMN: 02-Oct-01]. However, earlier this week it warned its residential connections could be cut off as soon as Friday. Although Cox’s contract with Excite does not run out until June 2002, the cable company’s customers could temporarily lose internet access should the bankrupt firm cease operations before Cox’s new network is built.
The proposed $307m sale to AT&T of Excite’s network assets was challenged by the latter’s creditors, angry that the sum was not high enough [WAMN: 22-Oct-01]. A ruling by a bankruptcy judge on their request to have the service shut down is due in the next week.
News source: MediaWeek.com (US)