DSL Firm's Demise Overstated?

Like the Massachusetts woman given up for dead by paramedics only to be heard coughing inside a body bag by a surprised mortician, regional DSL provider Vitts Networks is showing signs of life.

by Colin C. Haley of boston.internetnews.com [January 30, 2001]

The New Hampshore-based digital subscriber line provider, which last week said it would close Feb. 28, has secured eleventh-hour financing and is encouraging customers to stay with it.

But Vitts Networks isn't completely out of financial danger just yet.

"We have short-term financing but we also need to have long-term financing," said Karen Lloyd, a Vitts spokeswoman.

Short on staff, not cash
Vitts is privately held and has always been tight-lipped about financing. That hasn't change with this bailout backing. Vitts would not disclose the amount, whom it came from, nor how long it would last.

While the news may be good for Vitts' 1,000 business customers, employees weren't reprieved. Vitts won't rehire any of the 270 workers it fired earlier this month. Company executives are exploring ways to run the business with the remaining skeleton crew of 70.

Again, Vitts would not elaborate, however one option likely under consideration is the scrapping the DSL business and concentrating on other Internet-related services, that require less overhead to operate, such as Web site hosting.

The strategy is beginning to pay dividends for HarvardNet, a Medford, Mass., company that recently signed a deal to host Ask.com traffic.

PR suicide
In addition to raising additional funds to expand, Vitts also acknowledges the daunting task of convincing customers from Maine to Massachusetts to stick with it, after committing a painful public relations blunder.

"I think reassuring people at this point is a very difficult thing," Lloyd said. "Regardless of what you say, people will remain rattled. We have provided an excellent service and will continue in that vain."

—End