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Your turn: @Home subscribers sound off

The Excite@Home debacle has angered employees, shareholders and millions of subscribers.


Your turn: @Home subscribers sound off

By CNET Staff
December 26, 2001, 8:00 a.m. PT

The Excite@Home debacle has angered employees, shareholders and millions of subscribers.

Customers complain of a messy switch to AT&T Broadband's slower network, and employees are worried about their jobs. Many people in both groups feel they've been sacrificed in a high-stakes game motivated by corporate greed.

"This whole situation has left me with a bad taste in my mouth for these corporations that are controlling the industry and making moves that have dramatic effects on us 'lowly' consumers," said Brent Hoefling, a network engineer in Norwalk, Iowa. "My trust in the Internet access companies will never be the same."

After filing for bankruptcy in September, Excite@Home bondholders rejected AT&T's offer to pay $307 million for the Net access provider's assets. On Nov. 30, a bankruptcy court judge ruled in favor of the bondholders, saying Excite@Home could end its contracts with its cable partners and seek more revenue through new contracts.

What followed was a brief but ugly standoff between Excite@Home creditors and AT&T. Bondholders wanted AT&T to raise its offer price and said Excite@Home would cancel its contracts with AT&T and other cable partners that night unless new deals could be agreed on.

Customers were left waiting to see if their Internet access would be cut off on a Friday evening, and when it was, they found themselves on hold on customer service lines as they tried to figure out what to do.

see CNET Internet: Find a broadband provider Since then, Net access has been restored for most customers, but at a slower speed. Meanwhile, Excite@Home has announced it will shut down for good in February.

CNET asked readers for their reaction to the collapse of Excite@Home, once one of the Net's most promising companies with a market value of some $35 billion. These are some of their responses, which have been edited for length and content:

Nightmare for employees, families
My husband works at Excite, and we moved here from Los Angeles seven months ago. It was hard for us to decide to move: We didn't know anyone in the Bay Area, I had to quit my job, and we all know how expensive it is to live here. Finally, we found a decent house, and we're moving soon. I had to request a school transfer for my son. We had PG&E turned off here and (turned) on over there, the phone, the change of address, all that. I guess what I'm trying to say is that this is unfair. There are families that are going to suffer a great deal because of this. Christmas, too, is just around the corner.

I am scared, upset, and (I) couldn't sleep for a week...because of this. I am worried for my family. I just hope this nightmare will soon be over. I feel bad for all the clients and families out there who are affected by this.

--Portia Esteban, home worker, Hayward, Calif.

As a small-town @Home user, my family feels cutoff from the rest of the world without Internet access. My daughter is attending college, and I was surprised to find out how much course work is done using the Internet. They have classes and labs online. Having an Internet connection is not an option in my household anymore--it is a requirement.

Our local cable provider is Mediacom. That fateful Friday, my Internet connection was cut off and not fully restored until Saturday evening. I have been trying to contact Mediacom and have had no reply. There has been no statement of what their plans are for cable-modem access, and they have recently increased our rates (again). Because I live in a small town, I don't even have the option for switching to DSL--it's just not available.

This whole situation has left me with a bad taste in my mouth for these corporations that are controlling the industry and making moves that have dramatic effects on us "lowly" consumers. My trust in the Internet access companies will never be the same.

--Brent Hoefling, network engineer, Norwalk, Iowa

As one of the 500,000 AT&T customers moved to the new network, I can tell you this is just the start. Though in theory I should have Internet access now, I am still unable to connect to the new network. AT&T provides a "configurator" program to change settings to reconnect with their new service, but it obviously is not foolproof. The AT&T "Customer Care" telephone line is playing a recording saying that because of the call volume they cannot take calls and to try back later. Their online chat support has queues of 1,200 people.

It is clear that it will take much longer for customers to really be re-connected, and satisfied.

--James C. Smith, market analyst, Berkeley, Calif.

(Editor's note: More than 850,000 customers have been switched to the new network.)

"Mismanagement and greed"
How stupid was Excite@Home to think they could do better than the $307 million AT&T offered? They should have taken the hint when no one else bid on the company. The worst, though, was when they cut AT&T off from their service. Good for AT&T for dropping the bid; it's another $307 million they can invest in new technology.

--Aleksandr Bromfield, student, South Hamilton, Mass.

The mismanagement and greed displayed by the players would be a good study for an M.B.A. course on how not to run a company. I will stay with Comcast for now, but one more false step and Comcast will be history.

Shame on the judge for siding with the greedy bondholders--he may be the worst offender in this mess. I hope someone appeals and his opinion is reversed. He evidently had no regard for those of us customers caught up in this battle. We were given no consideration at all.

--Emilie McAlevy, Comcast subscriber, Longboat Key, Fla.

I am sure I speak for the vast majority of cable modem users when I say that we don't give a rat's ass who provides the backbone for the cable companies, as long as we can experience the (relatively) high-speed, (almost) always-on Internet access we have come to know and pay big bucks for.

--Gil Poulsen, computer consultant, North Plainfield, N.J.

I am a very minor shareholder in Excite@Home as well as a subscriber (to) Comcast Internet service. Suppose Excite@Home assets are distributed to the cable companies during the transitioning phase. During this phase the "sub-debt" bondholders recoup 20 cents for every dollar, but there is no money to distribute to shareholders. It would be nice if a minor shareholder in Excite@Home had some way to pick up a server or two at "fire sale" prices during the "transitioning" phase.

--Roy E. Heistand, retired system programmer, Sarasota, Fla.

As a blind person, I sure am not happy with this new AT&T Broadband service. The speeds are terrible. I did have Pac Bell's DSL service but wasn't happy so (I) switched to cable. I had @Home for about two weeks and now this. I got a taste of great speed and it was wonderful, but now it's almost as bad as a modem.

I'm surprised no one is fighting for the consumer. Hopefully this will all shake out. I depend on my computer.

--Don Coco, software technician, Sacramento, Calif.

No more cable for me
AT&T cannot compensate me for losing my Net identity, the e-mail address I've used for over two years, and all the services and subscriptions I have under that address. Their "2 days for 1 day" offer is completely laughable.

I've put in an order for DSL service. It might not be any better, but...being a network technician, the phone company will find it harder to bluff me when things go awry like the cable company could.

--Guy Teague, WAN analyst, Euless, Texas

I'm another angry Excite@Home cable customer who was switched to AT&T's cable services without permission. I noticed a definite decrease in performance for even doing standard things like downloading software updates, watching videos, and uploading digital photos.

Back when Excite@Home bumped their monthly rate from $39.95 to $45.95 I was annoyed, but because I realized they offered higher bandwidth than what my neighbors were getting with DSL, I stayed. Now that I am getting what I see is less than DSL, I'm definitely switching to DSL.

--Phil Dunn, product line manager, Menlo Park, Calif.

I don't have a home landline (using a cell phone instead), so establishing DSL service is difficult. However, the events (and service level) of the last few weeks have been the last straw. I'm not going to pay $49 a month for what has become dial-up, and several DSL companies include the cost of a landline in their packages.

--Dave Sheranko, sales associate, Harrisburg, Pa.

I was at one time considering getting @Home service through Cox cable. I am glad I didn't. The whole thing is a big, ugly mess. I can see it being tied up in court for years, everyone slapping a lawsuit on everyone else. I think I will stay with my dial-up service. I am confident they will be around a long, long, long time.

--Barbara Zola, cab company shift supervisor, Phoenix, Ariz.

Good riddance, Excite@Home
Excite@Home has been spending the money from cable subscribers to keep a losing portal alive. I say good riddance.

--Marianne Bush, retired, Belmont, Calif.

It seems to me that Chapter 11 provides a way for people who should be held accountable to go free. Internet service is now so universal and essential that it is effectively a public utility and should be regulated as such.

I have no service because of the idiots who evidently could not run a Sunday school outing. Do I need it back? Yes. Am I hurting? Yes. Am I angry? Yes--very.

--Michael Buss, software engineer, Santa Ana, Calif.

The people who ran this company into the ground should consider themselves lucky that they won't get what they deserve.

--Bob Huffman, chemical consultant, Flat Rock, N.C.

Not the end of the world
Labeling the possibility of being shut off from your broadband Net access as a "crisis" is a severe overstatement. Didn't we develop a broader perspective in the aftermath of 9/11?

--Daniel P. Mullen, PR executive, Seattle

I was disappointed at the disruption on Saturday, but by Tuesday everything was back up and working. Yes, I had to reconfigure for some changed IP service addresses, but the information was easily available and accurate.

Overall, given the circumstances, I'm OK with how AT&T handled things.

--Daniel Rosenblatt, software engineer, Littleton, Colo.

I don't think it's necessarily Excite@Home's fault. If the cable companies had given them more money in the first place, Excite@Home might not have had such financial difficulties.

I'm a Comcast@Home subscriber from New Jersey who uses the broadband service for personal use. My thoughts? I'll live. It's the end of a company, not the end of the world.

--Erika Dankovits, copy chief, Clifton, N.J. 

Consumers face narrow broadband marketNext page

By the numbers
$307 million: AT&T's offer to buy Excite@Home, rejected by bondholders as inadequate

$205 million: Estimate of what will be left for bondholders and creditors from the $355 million in new cable partner contracts

$6.7 billion: The price @Home paid to buy Web portal in January 1999

$10 million: The price rival iWon paid to buy's assets in November 2001

$780 million: What Excite@Home paid for online greeting card company Blue Mountain Arts in October 1999

$35 million: What American Greetings paid to buy Blue Mountain Arts from Excite@Home in September 2001

$35 billion: Excite@Home's approximate market capitalization in 1999

$5 million: Excite@Home's approximate market capitalization in 2001

$99: Excite@Home's all-time share price high

$0: The amount shareholders can expect to get for stock held

4.1 million: The number of Excite@Home customers in November 2001

45 percent: The number of U.S. home broadband subscribers whose Net access was provided by Excite@Home networks

Source: CNET

Sound off
Here are a few places that consumers can register their opinions on the Excite@Home meltdown:

• Sign an online protest petition

• Contact your congressional representative. Enter your ZIP code at this Web site to identify your representative. Also, contact information for all representatives is available at the Senate and House Web sites.

• Contact the Senate Committee on Commerce, Science and Transportation via phone and mail addresses listed on this Web site. Or e-mail Chairman Sen. Ernest Hollings or e-mail ranking Republican Sen. John McCain.

• Contact the Federal Communications Commission (FCC).

• File a complaint online with the Federal Trade Commission (FTC).