Unable to reach an agreement with AT&T to buy their assets for $307 million (US), broadband Internet company Excite@Home shut down their service last weekend in protest. With close to a million Excite@Home broadband customers without Internet access, a revolt against the big corporations that control the Internet is imminent. Consumers will no longer tolerate the awful treatment given them by an arrogant mega-corporation like AT&T! If nothing else, the FCC must be involved and government regulation should be imposed upon the Internet businesses so that a massive shutdown like this never happens again!

>Shik-UH< >Shik-UH< >Shik-UH< *WHACK!* *WHACK!* *WHACK!*

That was the sound of me shaking you all by the lapels and slapping you back into reality. What are we talking about here? Are we really talking evil mega-corporations, an embattled Internet portal with millions of loyal customers and a big money hostile takeover here? Are you all Japanese cartoon characters living in Neo-Tokyo 2017? Excite@Home isn't going under because of some AT&T-led industrial sabotage, kids. Excite@Home is bankrupt because they overextended their reach into markets they couldn't compete in, spent too much money, believed all the hype of the "Internet Economy" and made bad business decisions. It is that simple, and I'm shocked nobody else sees it.

What is even more shocking is how many of the techno-libertarians have suddenly regressed into screaming pink babies wanting government nannies to kiss their boo-boos and make it all better. David Coursey, a borderline techno-libertarian commentator with ZDNet, complained that Excite@Home was an "essential" service and should be protected by the government. Coursey said in his latest commentary "a program for orderly transitions when companies like Excite@Home go bust [is needed]. Since companies can't be counted upon to do this themselves, the government needs to protect us. The best - perhaps the only way - to do this is through regulation."

Coursey claims the Internet (and therefore Excite@Home) is a vital public service like the electric company and the airline industry. Dave, you lost me at the airline industry as a "vital public service" bit. To people like Coursey, deregulation caused murderous thugs to slam four jetliners into the Pentagon, WTC and a field in Pennsylvania. Thanks to that mindset, we can now expect the same hassle-free service from government employees at the airport that citizens get from the Post Office, Department of Motor Vehicles, Social Security office and Internal Revenue Service. Give me a break! I know a couple of pilots, but none of them ever called their jobs a "vital public service." Flying is as vital a public service as dry cleaning.

Speaking of dry cleaning, I found a dry cleaner that is also a broadband Internet user. James B. Bond, Jr. owns a dry cleaning business in Arlington, Texas and was an Excite@Home subscriber. Mr. Bond's story was quite different from what I had been seeing and hearing in the tech press concerning the Excite@Home shutdown. Unlike most people interviewed on the subject of AT&T and Excite@Home's feud, Mr. Bond said that AT&T was actually the good guy. "AT&T has been really great about the transition," he said on Tuesday. "I was informed well in advance that they might migrate my service over if things fell through with Excite."

I wondered, how can this be? All reports in the media paint AT&T as the big evil corporation, low-balling Excite@Home with a puny $307 million bid for their company (which is probably $306,999,632.48 more than I'll ever see in my lifetime)! Sure, AT&T had pumped hundreds of millions into Excite@Home in the past, partnered with them in hooking up Excite@Home customers in certain markets and held 79 percent voting interest in the company, but that doesn't mean Excite@Home deserves $307 million when they ask for $1 billion! According to the tech press, it was @Home's only recourse to cut off their partner's service in such an abrupt manner. Wasn't Mr. Bond angry about his Internet service being cut off so suddenly over the weekend because of this hostile takeover?

"No, I think @Home sucks for trying to extort money from AT&T and other broadband companies by threatening to shut down the pipeline." Mr. Bond said. "I was only down for about 72 hours, and I was told about it about two weeks in advance. Plus I got a credit for twice the downtime." Of course, Mr. Bond's dry cleaning business is not a business that relies on the Internet for their transactions. I wonder why Mr. Bond was the only person out of 850,000 Excite@Home customers to get two weeks notice about the outage?

There are plenty of inconsistencies with how the Excite@Home bankruptcy has been covered by a squishy left-leaning tech press. Allow me to break it down for them in easy to understand concepts:

1) Excite @Home did not think that $307 million from the partner that had 79 percent voting interest in their company was a good enough deal. The $1 billion figure was an appraisal done by Excite@Home, not some independent firm. To top it off, Excite@Home owed their creditors (including AT&T over $1 billion). This is like telling your boss "pay me a gazillion dollars a year or I walk", when you are working as a part-timer in a Krispy Kreme and you've already spent the two months salary your boss advanced you the first day on the job.

2) @Home bought web portal/search engine Excite in a $6.7 billion stock swap in January 1999. Once they had merged into Excite@Home, the company continued to buy and buy and buy. When Excite@Home noticed that they weren't making more money than they were spending, they just borrowed more money. This is part of the reason AT&T has 79 percent voting interest in Excite@Home. In other words, Excite @Home should've spent their money more wisely.

3) Excite@Home does not heat your home, supply you with fresh water to drink, take out your garbage or provide any other essential service required for human beings to live. They are a company that allows you to email your friends, send e-greetings, play video games, steal music off of Napster and look at porno. These are conveniences rather than vital services.

4) If your business, no matter how essential you think it is, makes stupid business decisions and borrows too much money, it is NOT the government's place to bail you out. Corporate welfare should be an extremely abhorrent idea no matter what your politics are. Yet, Democrats and Republicans both know that a fat pork package to Silicon Valley guarantees plenty of votes on Election Day. Avoid the temptation to redistribute our hard earned money to pay for some Excite@Home board member's golden parachute.

Of course, in a few weeks this won't mean much. AT&T has gone from "acquisition" to "transition" mode with the customers they gained when partnering with Excite@Home. The other cable companies like Comcast and Cox are also coming in to take what they can from their partnerships with Excite@Home in the coming weeks and months. With that, the battle for Excite@Home will be lost, and another victim of the New Internet Economy hype rolls to the densely populated graveyard.

Can lessons be learned from Excite@Home's failure? Is a government bailout followed by massive regulation really the answer? Let me know scott@worldtechtribune.com
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