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@Home Post Mortem: Who or What Killed @Home?
bofus writes: "This article from CNet points to AT&T taking over the @Home board as the nail in the coffin for @Home. It starts out as a tale of possible corporate espionage, with a top techie from AT&T moving to @Home and then back to AT&T, but the guy in question seems to have done nothing but good for @Home while he was there."
Jesus christ. Every goddam analyst on the planet seems to think they know why @Home failed. It's not rocket science, it's basic accounting.
You dump a few billion dollars into a nationwide network, and then you convince every cable television provider you can shake a stick at that broadband internet is within their grasp, and that you'll help them deploy it by being their internet access point. You get a few hundred cable systems online, and all is good. You get 50% of their profits for providing the bandwidth, and they are happy because they've found a new source of revenue.
Your market share continues to rise as your cable systems count skyrockets past the thousands. Everything is great! But then it happens. Being that cable systems are greedy bastards, they start eyeing up your 50% of the profits. Then, the guy in their NOC that actually had the cluestick long enough to set up the whole damn headend for broadband internet has an idea. Why don't we just drop @Home and get our bandwidth from the local telcos? After all, DS3's from Chicago cost thousands more than DS3's from the Bell office down the street.
And one by one, every cable system that @Home helped set up, went independant. I worked in the cable industry at the time, and I saw it coming from a mile away. Hell, I watched the DS3 from @Home go dead. I day I heard that every one of our markets in the entire state was ditching @Home was the day I told everyone I knew to sell all of their @Home stock.
But it gets better. @Home wasn't stupid. They knew that cable providers would eventually catch on. So they made lengthy contract with them. The problem is, the contracts ended up benig too market specific. For months, we supported both @Home, and our proprietary network. All new markets going live with broadband internet wouldn't even know what @Home was, as we only offered our proprietary network in new markets.
Eventually, we bought out the remainder of the @Home contract. @Home was stupid as all hell to let that happen too. That market's size has more than doubled in the past year. They would have been rolling in it. But then again, I supposed that when you're billions in debt, lump sums of cash can sure be appealing to your accountants as they try to fend off the lenders.
Making a long story short, @Home's demise had little to do with their network, and everything to do with unrenewed/prematurely-ended contracts. @Home's network was incredibly fast. Surprised the hell out of our network engineer at several times. But, you just can't run a business when you're not generating revenue.
Excite. Originally, Excite was bought by @Home simply to provide content. However, when Excite's CEO took over, that idea was quickly turned around - @Home's only purpose from then on was only to provide money to the cash-hemorrhaging, media-obsessed, dot-com-fetishists screaming "I'm not quite dead!" after having lost the "portal wars" to Yahoo long before. Had Excite not been the parasite that it turned out to be, @Home would have been profitable, strong, and still expanding today. They had a product that there is clearly a demand for, and (as the article states) in spite of Excite's draining away of every penny that @Home took in (and then some), they still managed to serve over 45% of all home broadband connections in the US. It would surprise me greatly to see any other company even come close to that accomplishment. What killed @Home Network? Excite@Home did.
-NOC Monkey (OOK!) Experience is what allows you to recognize a mistake the second time you make it.
No joke. The amazing thing about @Home was that they were all so damn arrogant, but didn't know $#!+.
I worked for a CMTS vendor for almost five years, and every contact with @Home was an exercise in insanity.
1: We were installing gear at an @Home site, and needed changes in the routing made to light up the new gear. Called the NOC a dozen times over the two days I was onsite with no response. I finally turned off one of the (redundant) power supplies on the @Home 7200 in the headend. Sure enough, the NOC called us within a minute. I had the guy who called find the Routing Diva (that's what her card said!) before I turned the supply back on.
2: They were constantly beating us up to make sure that the modems wouldn't bind to IP addresses learned from ARP, since then you could just statically configure an IP address you wanted to steal. No, they insisted that we sniff DHCP, that way their magical DHCP-integrated-with-billing server could be authoritative. We actually preferred using DHCP to ARP (since we had to relay DHCP anyway) and added a switch to disable learning from ARP. So far so good, except that their DHCP implementation was non-standard. It completely ignored giaddr, and assigned the IP based on client ID. (That caused countless other problems, as you might imagine...) Fine, except that the Client ID was also the hostname in @Home's DNS.
For those of you who lack a devious mind, this means that all you had to do was a reverse lookup on the address you wanted to steal, enter that as your client ID, and the DHCP would assign you the address you stole.
You have violated Robot's Rules of Order and will be asked to leave the future immediately.
I was an @home tech support agent....so I got info from the inside
@home started up the service and contracted out to cable companies
we all know this
problem was the cable companies were pretty money grubbing...in fact @home only got between 25 and 30 percent of profits per subscriber (not the 50% that one person noted) and because @home was losing money from this, they attempted to get the cable companies to alot them 50% of the profits, which halfway happened...they get maybe 40-45 in the end...and the cable companies decided to hike their prices to make even more money (none of them would've been losing any profits by keeping prices the same but they tried to put it off as only @home hiking the prices...bs)
Att actually built up their network before the contract crisis began and didnt tell anyone (I cannot tell you how I know this for I get killed =] ) and when they knew beforehand that they were already going to cancel their @home contract...or end up buying them. Att opted out as we know, but @home managed to keep contracts with some of the remaining larger contracts. These were to be extended for a short time period but there was too much money to be lost and @home had to just cancel it all. All the money was gone. The reason @home died was almost entirely because the cable providers refused to pay the money to keep the service connected through their lines, and it would've been too expensive of a venture to run the lines themselves.
and if they are mod me down. But here are the facts.
.. @Home should have stuck to the basics and became a pipe. Not to mention should have snuggled themselves really close to Yahoo and went into a partnership with them.
.. you heard me .. AT&T destroyed this company because they wanted the broadband. In 1999 they bough a portion of @Home and were in control of it. So many people do not pay attention to this fact. AT&T found it more beneficial to destroy @Home and switch over the subscribers then by out the remaining shares of the other cable companies.
1) Overspending. They thought there stock would go to 1000000. Spend, Spend, Spend.
2) Excite. 6 BILLION!!! in cash and stock swap. OBTW, Excite was sold off a few months ago for $175,000
3) AT&T YES
Hey, for what its worth @Home was great. I will be honest, I had the service for 4-5 years and ALWAYS had a static IP address (though they liked changing it around now and then). Service was always up, and could do whatever I wanted.
Well as we know times are changing, but if anything, from the way things look, I am happy to be a Cox customer then any of the others.
-- Knowing too much can get you killed, but knowing who knows too much can make you rich.