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AT&T's Identity Crisis
Buy Covad? Find another way home?
(old news - 07:13PM Tuesday Feb 25 2003)
tags: dsl · business
AT&T sold its broadband service to Comcast because, as Vik Grover, an analyst at Kaufman Brothers suggests, "broadband was a dream for the old AT&T"; the company now focusing on local phone service where "an easy dollar can be made." The recent FCC ruling (if it stands) in essence gives AT&T three more years before it may be forced to start building its own facilities, a situation that leaves the company looking for a "more capital efficient way (to reach customers) than trying to wire every home," says AT&T Chairman David Dorman. Despite the company's failed Northpoint experiment, at least one columnist thinks that AT&T should seriously consider buying Covad.

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Forums » AT&T's Identity Crisis
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Go Chargers7
Fa Shizzle Ma Nizzle
Premium
join:2002-09-24
Huntington Beach, CA


edited

They had it...and sold it...

Wait a minute. Am I missing something? Didn't they just sell off the unit that HAD EVERYONE WIRED, or at least a few zillion...the unit that made them HUGE money (so sayith their annual reports, profits in the billions from their broadband unit). If they wanted a chunk of the local service pie all they had to do was finish the telephony rollout and acquire more franchises. They're looking for a capital efficient way...there's nothing more efficient than being wired to end users and making a HUGE profit doing it.

Now, they're 3 months into this thing and looking for ways to get back service to end users? Genius.

WTF...where did these guys get their degrees? Cracker Jacks?
--
When yer a pioneer, you're bound to get a few arrows in the butt.

[text was edited by author 2003-02-25 19:21:49]

Combat Chuck
Too Many Cannibals
Premium
join:2001-11-29
Erie, PA

Re: They had it...and sold it...

A brief look into the near future:

-------
To: AT&T investors
From: AT&T
Re: recent AT&T broadband spinoff

Dear investor;
Oops.
-------

Now I just wonder if the bigwigs at AT&T realize what they've done yet or not.
--
The USA is not alone!

batageek
Slave To The Duopoly
Premium
join:2003-01-25
Batavia, IL
See someone who's been saying the same thing (AT&T buys COVAD) for a while now.....

»www.eprairie.com/news/viewnews.a···rID=4360

Mike
Premium,Mod
join:2000-09-17
Pittsburgh, PA
clubs:
·Verizon Online DSL

Host:
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World of Warcraft
Alltel Axcess
Verizon Wireless

Another Northpoint

AT&T bought Northpoint and turned it into the ground face first. They illegally kicked off 'a few' thousands subscribers overnight and got away with it.

I'm glad it turned sour for them.

There is always at least one idiot out there... that columnist is it.
--
root sounds cooler than administrator anyhow
What this country needs is a good five dollar plasma weapon.
cmaenginsb
Premium,MVM
join:2001-03-19
Palmdale, CA

Re: Another Northpoint

AT&T never had any rights to the Northpoint subscribers, nor did they actually buy Northpoint. The bankruptcy court auctioned off the assets piecemeal. AT&T ended up with the DSLAMs and other equipment but not the right to continue to service on the lines.

Do you really think they would have turned off the subs if it wasn't out of their control, I mean come on that's like free money.

pnh102
Reptiles Are Cuddly And Pretty
Premium
join:2002-05-02
Mount Airy, MD

Re: Another Northpoint

said by cmaenginsb See Profile:
The bankruptcy court auctioned off the assets piecemeal. AT&T ended up with the DSLAMs and other equipment but not the right to continue to service on the lines.
That's still very stupid of AT&T... how long would it have taken for them to check to see if they could legally run service on the lines they got from Northpoint? Surely it would have involved less cost than buying the assets and finding out they got a bunch of expensive paperweights instead.

AT&T really needs to take an "Al Dunlap" approach to saving its skin... kill all the non-profitable divisions... or else.
--
DRM == Doesn't Read MP3s

airhockey
Got Airhockey?
Premium
join:2001-03-01
San Jose, CA

Re: Another Northpoint

The problem is ATT has only non profitable divisions left. They sold the only one that has been making them money ATT Broadband.

richb01803
Rich

join:2001-02-14
02100

AT&T will be dissolved

said by airhockey See Profile:
The problem is ATT has only non profitable divisions left. They sold the only one that has been making them money ATT Broadband.
Sounds just like Digital Equipment Corporation circa 10 years ago. The hard drive group went to Quantum, the networking group went to Cisco, the chip-fab went to Intel.

The core group left was something they'd now call "professional services". Seems like every company thinks there are huge profits to be made in consulting.

But that only works if you've got the consultants attached to complicated proprietary technology that you can lock customers onto an upgrade treadmill. The folks at Compaq only figured that out after blowing a huge wad of money buying up the gutted shell of DEC, minus its crown jewels.

I guess management at most companies, when faced with a dire cash crunch, will sell off the crown jewels one at a time rather than enter bankruptcy. Of late, though, it's becoming evident that those who have tried bankruptcy on for size are keeping their firms intact, perhaps to live another day.

AT&T has nothing left. They are as relevant today as DEC was in 1995. Doesn't take a crystal ball to see what's in store for them: absorption into some other phone company.

KoolMoe
Aw Man
Premium
join:2001-02-14
Annapolis, MD
clubs:
·Verizon FIOS
·Speakeasy

Re: AT&T will be dissolved

I disagree that they're irrelevant - they have a huge phone switching system. However, they may be made irrelevant if they don't keep on top of VOIP.
If AT&T is focusing on local service, then partnering with Covad would make good sense so they can offer DSL with their POTS service.

And DEC may have sold off the 'crown jewels', but they retained a LOT of intellectual property and patents (the Alpha being a big one), which did make them a fairly valuable company for Compaq to aquire...
Though I agree they overpaid.
I also agree AT&T's future is cloudy, but don't think it's as doomed as you postulate...
KM

VinnyJ

@aol.com

AT&T Corp. will never go away. One reason the name along is the best known WORLD WIDE in telecom. Two, only AT&T has the power to reach every telephone in the world, no one else can claim that. Three, AT&T's network is not just the world's largest telecom network, but it is also one of the world's largest IP network. Four, AT&T is the only company that has the ability to replace, within 24 hours with mobile trucks and swtiches, an entire central office, as they did for the first time in their entire history on 9-11. Time and time again, AT&T has changed and moved on, granted this time i think they were really screwed over by Armstrong, I know they will still go on to lead the industry. AT&T may appear to be just a phone company, but in reality the are one of the most trust, and with good reason, communications providers.

BrianDamage
We Are The Hounds From Hell
Premium
join:2001-08-14
Rowlett, TX
clubs:

Re: AT&T will be dissolved

Let me detail some history here.
AT&T Corp. will never go away. One reason the name along is the best known WORLD WIDE in telecom.
AT&T is not the same company it was prior to divestiture. Yes, the name is well known, but that is based on what people remember before the breakup. It is like calling a cotton swab a "Q-Tip" or a finger bandage a "Band-Aid"...it is what people remember, but not entirely accurate representation of the truth. They are proper names, that are easily remembered and referenced in a conversation.
AT&T has the power to reach every telephone in the world, no one else can claim that.
So could Worldcom or many other phone companies that offer local service. One does not have to own all the facilities globally in order to get a call through to anywhere in the world.
AT&T is the only company that has the ability to replace, within 24 hours with mobile trucks and swtiches, an entire central office, as they did for the first time in their entire history on 9-11.
That was Verizon that did that, not AT&T. Additionally, the former company that was the incumbent prior to merger upon merger was Nynex. They hadn't been AT&T since divestiture, which was 1984.
Nice AT&T plug, though, but AT&T is a shadow of it's former self, and continues the name recognition based on the 125 year long legacy of the phone business. That doesn't make the popular perception these days accurate, though.
--
The rich get richer, the poorer get the picture, the bombs never hit you when yer down so low...some got pollution, others evolution, there must be some solution but I just don't know....briandamage@dslr.net

Jim Gurd
Premium
join:2000-07-08
Plymouth, MI
·Comcast

said by pnh102 See Profile:

AT&T really needs to take an "Al Dunlap" approach to saving its skin... kill all the non-profitable divisions... or else.

I don't know about that. "Chainsaw Al" destroyed Sunbeam with shady accounting practices like stuffing the pipline with inventory and booking sales months in advance of actually delivering the merchandise.

rockjock

@65.103.x.x

Re: Another Northpoint

"I don't know about that. "Chainsaw Al" destroyed Sunbeam with shady accounting practices like stuffing the pipline with inventory and booking sales months in advance of actually delivering the merchandise."

Can you say "Q W E S T"??

Sounds quite similar to what most telecoms did over the last 5 years with line swapping.

BrianDamage
We Are The Hounds From Hell
Premium
join:2001-08-14
Rowlett, TX
clubs:

Wrong. ATT did buy Northpoint's assets, DSLAMs and all, but you are correct when you stated that ATT ws not entitled to NP's subscriber base.
The plan was to let the network go dark, relinquish all the network circuits, and then turn them all back up using their own facilities as much as they could and then relight the network.
The problem was, ATT did not realize prior to their actual purchase of NP that their contracts with the cable providers PROHIBITED them from providing other broadband type services, DSL specifically.
Somebody missed the fine print, and in their zeal, paid the 155 mil not fully realizing until after the fact that the entire DSL network in place would be unusable by them, because of agreements and contracts already in place.
I know this because a manager from ATT's then newly created DSL unit contacted me about a position, and we discussed this fact in detail.
At that time, they were still attempting to get past the legal ramifications of the purchase, but it turned out that they never could overcome that, and I had a feeling that such would be the way.
--
The rich get richer, the poorer get the picture, the bombs never hit you when yer down so low...some got pollution, others evolution, there must be some solution but I just don't know....briandamage@dslr.net

KoolMoe
Aw Man
Premium
join:2001-02-14
Annapolis, MD
clubs:

Re: Another Northpoint

SO now with ATT Broadband sold off, they can start relighting all the Northpoint DSLAMs and such, and contract Covad for the areas that NPT equipment doesn't cover...
Right?
KM

BrianDamage
We Are The Hounds From Hell
Premium
join:2001-08-14
Rowlett, TX
clubs:

Re: Another Northpoint

Theoretically, yes, if the sale of the assets releases them from obligation to the contracts they have signed.
But, there is a problem.
I am familiar with Northpoint's lineups.
In the COs, a lot of times, Northpoint's lineups were right next to ours (I worked for both Covad and Ryhthms at different times), and NP had primarily the Copper Mountain platform in use, which at Rhythms, we had also, in addition to Paradyne and Cisco equipment.
As such, I am familiar with all of that equipment.
The thing is, the NP DSLAMs have sat there for so long now that before they could be relit for any useful purpose, they would need to be upgraded.
That is going to be a very expensive proposition, albeit a good one for Copper Mountain. I am sure those guys could use the sales.
Not beyond the realm of possibility, mind you, but an expensive proposition.
How ready they are to do that is questionable.
--
The rich get richer, the poorer get the picture, the bombs never hit you when yer down so low...some got pollution, others evolution, there must be some solution but I just don't know....briandamage@dslr.net

DrTCP
Yours truly
Premium,ExMod 1999-04
join:1999-11-09
Round Rock, TX

said by Mike See Profile:
AT&T bought Northpoint and turned it into the ground face first. They illegally kicked off 'a few' thousands subscribers overnight and got away with it.
Mike, as far as I remember AT&T only bought the assets of Northpoint. The customers was belonging to Northpoint till the very end and if someone has cut off the customers' service it was Northpoint itself by selling all its equipment by auction. AT&T had no obligation to provide free service to anyone.

Mike
Premium,Mod
join:2000-09-17
Pittsburgh, PA
clubs:

Re: Another Northpoint

Does the FCC policy of 30 days termination notice mean anything? Or was that a loophole?

DrTCP
Yours truly
Premium,ExMod 1999-04
join:1999-11-09
Round Rock, TX

Re: Another Northpoint

said by Mike See Profile:
Does the FCC policy of 30 days termination notice mean anything? Or was that a loophole?
FCC had no enforcement on AT&T since they were not AT&T customers. Remember FCC bought only the equipment very much you buy equipment at Ebay but in this case seller said come and pick up the equipment (no shipping)

FCC could try to enforce it on Northpoint but I doubt bankrupt Northpoint having sold its equipment could do anything to satisfy that. You cannot kill dead twice.
2farfromCO7

join:2000-10-14
Farmington, MI

If this is doable, WHERE IS THE HELL IS IT????

Why are there ZERO, ZILCH, NADA, ABSOLUTELY NO WISPs in most metropolitan area(the bay area does not count)? We aren't dealing with a few areas not covered. We are dealing with NO AREAS COVERED. Why is there so much speculation of wireless broadband, but ABSOLUTELY NO ACION AT ALL?? The only wireless access for most people is to use their 3G cell phone and violate the TOS. As to that, I say extreme situations require extreme measures. If broadband is not available to you, you should legally be allowed to use any and all means necessary legal or illegal to get it. If the infrastructure providers don't like, start deploying and stop complaining.

Go Chargers7
Fa Shizzle Ma Nizzle
Premium
join:2002-09-24
Huntington Beach, CA


edited

Re: If this is doable, WHERE IS THE HELL IS IT????

Someone is desperate In our town we have 4 WISP's and Comcast. Of course the ILEC is sitting on it's ass as usual. It's a bad business plan to rely on other businesses...especially those who end up being yer competitor.
--
When yer a pioneer, you're bound to get a few arrows in the butt.

[text was edited by author 2003-02-25 19:23:45]
2farfromCO7

join:2000-10-14
Farmington, MI

Re: If this is doable, WHERE IS THE HELL IS IT????

California doesn't count. That's not the real world. The fact that people in your area were convinced completely that Webvan had a good business model is all the evidence I need to prove that California is not the real world.

Go Chargers7
Fa Shizzle Ma Nizzle
Premium
join:2002-09-24
Huntington Beach, CA

Re: If this is doable, WHERE IS THE HELL IS IT????

LOL...

We need to export our WISPs and our Politicians...a little good with the bad.
--
When yer a pioneer, you're bound to get a few arrows in the butt.

pnh102
Reptiles Are Cuddly And Pretty
Premium
join:2002-05-02
Mount Airy, MD

said by 2farfromCO7 See Profile:
We are dealing with NO AREAS COVERED. Why is there so much speculation of wireless broadband, but ABSOLUTELY NO ACION AT ALL??
Why not take a bunch of your friends who are pissed off about this, pool your funds (or get some business loans), get a fractional T1 and some WAPs and set that up for subscribers to buy into?
--
DRM == Doesn't Read MP3s

CoxCable4
Temp banned from BBR more then anyone

join:2002-10-02
PwnZone

thats sad

even a large dsl provider like covad that resells to other companies can be tossed around bought and sold easily by monsters like at&t. id like somebody to toss around at&t for once. btw, wheres my northpoint dsl? (i kinda liked it)

Mike
Premium,Mod
join:2000-09-17
Pittsburgh, PA
clubs:

Re: thats sad

sitting in a warehouse just like the red cross 9/11 refund donations

Tomek
Premium
join:2002-01-30
Brooklyn, NY
·Packet8
·Verizon VoiceWing
·Verizon Online DSL

FCC

Recent problems are all caused by FCC. CoVaD may need stronger capital to compete with local phone companies when serving DSL.
As I believe, AT&T currently offers DSL via CoVaD. Buying CoVaD would save costs. (AT&T promises to keep 39/mo rate for a year)

That FCC ruling has to be appealed. That creates monopolistic situation in DSL industry.
Mr_Hanky00

join:2003-02-25
Riverton, NJ

Re: FCC

I agree
clecrupt9

join:2002-01-22
GA

Smoke and Mirrors

Something just isnt right. T sells off cable to Comcast then wants to buy Covad? After this latest ruling?

I say they wanna merge with a telco.
kmoss

join:2002-09-14
Lisle, IL

At&t buy Covad?

So, Covad is going to be both SBC and NOW At&t's bitch? I don't think so... leave it someone named "Bambi" to conceptualize such a stupid proposition. I have an executive level contact at the old ATT broadband (now Comcast). He told me that ATT screwed around with wireless broadband years ago and decided against deployment at the time. My guess, they're waiting for the price to catch up with technology for wide-scale deployment of wireless broadband+Voip (and if the bandwidth is there, VOD). Then, all they do is throw up the broadcast points on existing cell towers. It's plug and play technology, doesn't involve upgrading Coax neighborhood networks, and deployable everywhere. Just my 2 cents.

KrK
Heavy Artillery For The Little Guy
Premium
join:2000-01-17
Tulsa, OK
·Cox HSI
·AT&T Southwest

Somebody should buy Covad....

...That way monopolies and the FCC would have to stop pretending there is still competition and admit there are no more CLEC's in data services, other then a few small bit players who will probably be dead after the FCC's latest ruling anyway.

Once people realize that no, this isn't a 'Free Market' and that competition DOESN'T exist, maybe they'll start looking at reigning in the Big Bullies who are wrecking America's broadband future.
--
"When the day comes that anyone can bend our country’s laws and lawmakers to serve selfish, competitive ends, that day democratic government dies" -- Preston Tucker, 1948 (Yep, it's dead.)

DSLTech

join:2000-12-30
San Jose, CA

ATT DOES use the old NP infrastructure..

Currently ramping up hiring down in Emeryville, CA for the same positions that handled background setup and troubleshooting of new/faulty DSL circuits (and virtual circuits).

Something is going to come of it yet, its just a matter of time.

Agent 86

Stupid article...ATT will not buy Covad

Why would they want to buy into a declining, unprofitable business? Much smarter to be a reseller.
FCC_clowns

join:2003-02-26
Beverly Hills, CA

Covad -logical fit with ATT local package offering

T's local bundle offer simply can't compete with the ILEC's if they don't include a DSL solution and its already well known that T ditched its own DSL network and has aligned itself with Covad.
Line-splitting between T and Covad has been under full investigation for almost one year.
Exactly what part of this puzzel isn't completely obvious?
ross

join:2000-08-16

Re: Covad -logical fit with ATT local package offering

Moreover, they deserve each other!
mlohrwork

join:2001-05-30
Laurel, MD
·Cingular Wireless

Please say it ain't so!!

Having wonderful support from my local ISP (charm.net) offering Covad it would be a tragedy for the future of Covad to allow ATT to destroy a viable service. AT&T doesn't have a clue since it keeps flounder with broadband why assume now that it will do any better with Covad then it previous forays into broadband.
FCC_clowns

join:2003-02-26
Beverly Hills, CA

Re: Please say it ain't so!!

Because the idea wouldn't be to tamper with Covad at all. The idea is either for ATT to work with Covad as a stand alone DSL provider or to buy Covad and allow them to continue to operate as they do today. Covad is a very lean
and efficiently run co nowadays (yes its still burning cash but should the bundling idea take off that will quickly be taken care of). They only have about 1300 employees nationwide and the company clearly doesn't carry any dead wood.
T doesn't have the required level of DSL technicians to run the ship. So if it aint broke why fix it.
russotto

join:2000-10-05
Collegeville, PA

Buy Covad? Why?

The anti-lineshare decision blows away Covad as well. There's thus no benefit in buying Covad.

DSL Repairman

@covad.net

Re: Buy Covad? Why?

What you fail to realize is that it is perfectly feasible for T to offer DSL thru Covad via Line Splitting. Hoffman himself has said this deal is being looked at very seriously (along with other UNE-P providers, so they may they may also offer complete services by bundling with Covad), and no matter what the final FCC decision, this is completely viable. This then enables T (and other UNE-P providers) to offer a completely bundled service, adding data to their local/long distance services, just as the ilecs do now. Covad is far from dead - hell, the FCC statement isn't even official policy yet, and god knows anything can change in the next few weeks regarding their errant line sharing decision... including the Courts shooting down the entire decision.
Forums » AT&T's Identity Crisis


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