Rhythms tries to kick-start its stock and Covad jump-starts its installs. While one national DSL provider hires up a legal team to look at its options another keeps merrily rolling along.

by ISP-Planet Staff [April 4, 2001]

Rhythms NetConnections, Inc. hired a slew of attorneys this week in order to take a long hard look at its business options. Under fire from auditors to find operational cash, the DSL wholesaler's flagging stock value has put the company in danger of being booted out of the stock market.

Rhythms officials said NASDAQ is preparing to issue a formal notification, which would delist the national DSL provider because its stock has been trading at less than $1 for more than a month.

Restructure, consolidate or sell
Officials haven't said whether they would appeal a decision by NASDAQ, but according to its 10K filing with the Securities and Exchange Commission, if the company doesn't appeal the stock index's decision, it will try to get Rhythms listed on the Small Cap Market board.

Rhythms hired investment banking firm Lazard Freres & Co. to evaluate its strategic and financial operations. Lawyers will determine the best course for Rhythms shareholders, not necessarily its DSL customers. Exit options include debt financing or restructuring, asset or equity securities sales, consolidation, or public or private sale. A company spokesperson would not comment on the status of Rhythms operations, and would not speculate on the fate of its customers should the company go out of business.

Speaking of easy
Meanwhile, Covad Communications this week introduced its JumpStart Install Kit, designed to be one of the most user-friendly DSL installation kits available to consumers today.

Covad's DSL JumpStart Kit walks the consumer through a simple three-step installation process, which includes preparing the consumer's home by attaching DSL blockers to every telephone, connecting the DSL modem to the computer; and installing software that will automatically connect the consumer's computer to the Internet. Most self-installations are expected to take approximately 30 minutes to complete.

Eric Moyer, Covad director of consumer product marketing, said the DSL JumpStart Kit enables the company to offer consumer broadband solutions eliminating associated install costs and delays.

" Covad's intuitively designed DSL JumpStart Kit is exactly what the industry has been waiting for—a kit that simplifies DSL installation and improves the overall consumer DSL installation experience,'' Moyer said.

The DSL JumpStart Kit is currently available through Speakeasy.net, one of Covad's national ISP partners. Within the next few weeks, additional Covad affiliate ISPs, like Prodigy, will also offer the DSL JumpStart Kit.

Mike Apgar, Speakeasy.net chief executive officer, said Covad's DSL JumpStart Kit would improve the efficiency of its DSL installation process.

"Given the continued high demand Speakeasy.net is experiencing, Covad's consumer self-installation offering is a critical step towards our goal of providing DSL service to our customers more quickly,'' Apgar said.

—End