Subscribers to the high-speed internet offering of AT&T found themselves abruptly offline on Saturday after bankrupt broadband provider Excite@Home – upon which AT&T relied for the package – cut off its service.

On Friday, Excite’s creditors won a legal battle to close the network if new deals were not reached with the cable companies using its services – AT&T, Cox Communications and Comcast Corporation. It yanked its broadband access from over 850,000 AT&T customers after failure to renegotiate contracts, although it is still in talks with Cox and Comcast.

The creditors argued that closing the network would force the cable companies to pay a fairer rate for Excite’s services, and would encourage AT&T – which holds a controlling stake in the broadband operator – to raise its bid for the bankrupt firm’s network assets from $307 million to over $1 billion [WAMN: 22-Oct-01].

AT&T spent the weekend desperately trying to find alternative ways to offer the service. It says around 86,000 subscribers have been switched to a new AT&T network.

News source: Financial Times