A San Francisco judge ruled on Friday that bankrupt ISP
Excite@Home could sever its distribution agreements with its cable
company customers because the agreements are financially
unfavourable to Excite. The cable companies were told that they
must negotiate new agreements acceptable to Excite or risk the
possibility that the service may be terminated.
The Excite broadband service is used by over four million
broadband customers in the US, or 45% of the cable modem users in
the country. The court case was opposed by the cable companies,
including AT&T Broadband which has attempted a hostile takeover
of Excite. The owners of Excite are hoping to find an alternative
offer, arguing that AT&T’s offer is insufficient to repay its
creditors.
On Saturday, AT&T Broadband’s 800,000 customers were
disconnected from the web following the court’s ruling. However,
according to the Washington Post, the company yesterday reached a
deal with 12 other cable companies to keep the remaining network
operational, at least for now. The companies will together pay
Excite over $300 million to keep the network running for at least
three months. A final agreement is due to be announced today.
