Covad Set To Emerge From Bankruptcy

powerlord writes "All of us still rooting for Covad can let out that deep breath we've been holding. According to an article on the Seatle IP Wire Covad is set to emerge from bankrupcy. They claim they've managed to shed most of their debts and are concentrating on 50 major metropolitan areas right now. They expect 40 of the markets to be cash positive by year end, with the entire company cash positive by mid 2003. Their stock rose $0.75 to $1.39."

This is really good news.

[Anonymous Coward]

Posting as AC for a reason.

I work for a Covad ISP and we have had to deal with major hassles for the last year or so in keeping our customers happy and buying despite the obvious uncertainty surrounding their finances. (The collapse of the other vendors - Northpoint, Rhythms, et al. didn't help.) When they finally did announce bankruptcy and the deal to get their affairs in order, we all breathed a sigh of relief - but still held on for dear life until the thing was completed.

Through all this, they have kept service levels very high. I'm quite impressed.

Too little too late

[AntiPasto]

As someone who lost their job (and one that I really really liked too) because of the bankrupcy, I'd just like to say that this is nice and all, but what are we to learn about emerging markets?
We were a reseller, and well, perhaps we jumped into it soon, but heck, we couldn't compete with cable, and DSL was the first to offer a sales chain so that we could keep our customers. We lost our customers, so they had to let me go (the reprovisioning person!!! hehe ah well).
The big bells still have DSL by the balls (I mean, after all it is their stuff, and they get support/technical/installation priority), so is small business connectivity provisioning going towards the relm of the phone/cable companies?

80% isn't enough?

[cperciva]

They expect 40 [out of 50] of the markets to be cash positive by year end, with the entire company cash positive by mid 2003.

Either there's some interesting accounting going on, or they'r expecting to lose *lots* of money in the remaining 10 markets -- like over four times as much as the average profit from the profitable markets.

Why postpone your funeral when youre ready to die?

[Error629]

Why postpone your funeral when youre ready to die?

If Covad really wants to make it, they need buy a vowel and change from a CLEC to ILEC. :)

Debt WAS the problem

[Anonymous Coward]

These guys ridiculously overexpanded; sent huge rebate checks to customers who signed up for service; spent tons of $$ on advertising; failed to get operational costs under control; and generally burned a billion dollars. (Yes, Virginia, billion.) Bankruptcy gave them a second chance that was much better than the alternative of liquidation. The ILECS contributed to the fuckups but were by no means the sole source.

Strange

[yoink!]

I find it really strange to hear about all these high speed service provider bankruptcies in the US. It seems like every few days or so, /. is running another story about a failed Cable or DSL provider.

What puzzles me even more is the widespread success, at least here in Montreal, Quebec, of high speed internet (both G.lite DSL and Cable.) In fact the biggest provider, Bell Canada, is going to RAISE it's dial-up rates in January, lower it's DSL rates (via a few special sign up offers) and attempt to force the remaining dial-up users over to domesticated dedicated internet connections. It must be getting to costly to keep up all those modem pools with fewer and fewer users on them.

Re:This is great news

[automatic_jack]

I use SpeakEasy too. After getting burned by Flashcom and their HORRIBLE service, Speakeasy has been a dream come true. Four static IPs, a 384kbit pipe, and dialup to use when the high-band is down, although the only times that has happened have been when FUCKING VERIZON PIECE OF SHIT TECHS unplug us.

I live in an apartment building, and twice in the last year our DSL has died. When Covad comes to look at it, the first time the wire was unplugged from the block, and the second time it was unplugged and actually cut, in three places. Apparently Verizon techs will cut Covad wires if they see them, because the Covad guys are not union. The second time this happened we had to pay $200 for repair. ARGH!

Actually it makes sense...

[sterno]

If they are taking the profits from those 40 cities and investing them in infrastructure and expansion in those other 10, then it makes sense that they wouldn't be profitable overall in the short term.