Want CNET to notify you of price drops and the latest stories?

Many Excite@Home customers disconnected

Many customers are unable to access some services from their high-speed ISPs, and they're worried that the problems are a result of the company's complicated bankruptcy proceedings.

5 min read
Many Excite@Home customers were unable to access some services from their high-speed Internet access providers on Saturday, and they're worried that the problems are a result of the company's complicated bankruptcy proceedings.

Customers throughout the United States told CNET News.com on early Saturday morning they could not access Web sites and were experiencing slow or flaky connections from their normally swift cable modems. Numerous Excite@Home customers, including those in California, Washington, Illinois and Michigan, said that service was down entirely, forcing them to revert to relatively lethargic dial-up service to send e-mail or surf the Web.

But Excite@Home spokesperson Londonne Corder said that Excite@Home had not "flipped the switch" to turn off or tamper with service for the Redwood City, Calif.-based company's 4.1 million customers. She blamed the isolated problems on breakdowns at regional cable companies.

"To my knowledge, no decision was made to block service," Corder said Saturday morning. She also said that she was unaware of any plans to block Excite@Home service in the next few hours or days.

Despite that denial, customers are concerned that the outages and disrupted service go far beyond localized failures. The problems, which started arising for customers as early as 6 a.m. PT, come less than 24 hours after a key court decision that threatened to terminate service for Excite@Home customers.

On Friday, a San Francisco bankruptcy court judge ruled that angry bondholders and cable partners of Excite@Home must go back to the bargaining table. In the weeks leading up to the decision, the cable companies threatened to cut off service if their contracts, which expired at midnight Friday, were terminated.

The cable companies are upset about having to renegotiate contracts, in large part because they fear that the new contracts will siphon revenue from them toward Excite@Home, which filed for bankruptcy protection in September. By some estimates, Excite@Home is burning through $6 million per week because of outdated contracts with the cable companies.

Although the contracts are complicated documents and vary widely depending on the cable partner, the agreements are weighted in the cable companies' favor. With the average cost of Excite@Home service around $46, the cable companies collect roughly 65 percent of that, while Excite@Home collects only 35 percent.

Interim contracts that parties negotiated in October are slightly different than the official contracts that are now being renegotiated, but the interim agreements still funnel a disproportionate amount of money toward cable companies. Contracts are also slightly different in Canada, where cable companies take as much as 80 percent of the revenue, leaving only 20 percent for Excite@Home.

Because Excite@Home filed for Chapter 11 bankruptcy protection in September, U.S. Bankruptcy Court Judge Thomas Carlson said Friday that Excite@Home may legally break its existing contracts to increase its chances of survival. He rejected the cable companies' argument that the contracts should be maintained to preserve the Internet service of 4.1 million customers, who represent 45 percent of the cable modem users in North America.

"Bankruptcy typically causes much disruption," Carlson said. "While the cessation of customers' Internet access is regrettable, it does not jeopardize public health or safety."

But customers were far less understanding on Saturday, when their normally fast Internet service began limping or not functioning at all.

Many users, including home-based business operators and others who rely on their connection for income, have been monitoring service almost continually since the judge's decision. Many complain that it would be difficult to find a new high-speed provider quickly, and they gripe about the prospect of going back to dial-up service.

"I was unable to connect via my cable connection and they have left me in the stone age with a backup dialup connection I have," said John Decker, an Excite@Home customer in Sacramento, Calif., whose AT&T Broadband service was cut off entirely as of about 7 a.m. PT. "I feel a bit like Osama bin Laden in a cave in Afghanistan."

Many customers found that their service was disrupted or terminated in stages--and they got little or no help from cable companies' toll-free hotlines.

David Lyman, an Excite@Home customer who connects through Comcast in Royal Oak, Mich., woke up to find that he could not surf the Web by typing in the uniform resource locator (URL) into the Web address line. Instead, he could connect to some sites--but not all--by typing in the Internet Protocal (IP) address, a series of numbers that uniquely describes every Internet site.

For several hours Saturday morning, Lyman's e-mail was functioning normally, but it stopped functioning around 9 a.m. PT. That put an end to Lyman's Saturday morning plan to investigate alternative high-speed service, including digital subscriber lines (DSL), from his home computer.

"I wanted to see what else I can get in this area as a backup," said Lyman, who uses his connection for both work and recreation. "But now I'm screwed."

An agent who took calls on a toll-free hotline for Comcast's southeast Michigan customers said Saturday morning that the problems were the result of a failure at a regional substation. Cable companies rely on a domain name server (DNS) to translate an address such as "www.yahoo.com" into its numerical counterpart. DNS is one link in a chain of required functions that can break down--and it's not an uncommon failure.

Many cable companies that provide service through Excite@Home, including AT&T Broadband, Charter, MediaOne and Comcast, could not immediately be reached for comment.

Cox Communications spokesperson Susan Leepson said that the cable company had not cut off any service intentionally as part of the contract renegotiations. She said Excite@Home and Cox executives planned to go back to the bargaining table Saturday, after a marathon negotiation session Friday.

"We're still hopeful that we can reach an agreement," Leepson said. But she noted that it's impossible to say how long the contracts--or the service--will last. "It's so fluid at this point," she said.

Comcast and other cable companies' Web sites did not reflect users' troubles.

"At this time, round-the-clock negotiations continue with Excite@Home and its creditors to prevent any interruption of service," according to an official bulletin from Comcast. "Currently, we are not aware of any planned service interruptions and will update this hotline if the situation changes. We apologize for any inconvenience this situation has caused and thank you for your loyalty to Comcast."