Fast Breaks Newsfront: September 3, 2001
Amazon Wades In
Amazon.com is heading into murky retail waters, announcing late last week that it will start selling PCs online. The announcement came the same day the Department of Commerce said that online purchases had dropped 1.8 percent to $7.46 billion in the second quarter, after slipping 14.5 percent in the first quarter.
Ericsson and Sony said they have agreed on terms to merge their unprofitable handset units and should unveil Sony Ericsson Mobile Communications by Oct. 1. Together, they should be able to challenge market leaders Motorola and Nokia.
Loudcloud reported a net loss of $76 million on revenue of $14.1 million for the second quarter, after taking a restructuring charge of $30.2 million. The managed service provider ended the quarter with $170 million in cash and cash equivalents, which it expects will pave its path to profitability as the company transitions from providing service to mostly dot-com operations to an enterprise focus.
Cable ISP Excite@Home saw its chances of avoiding bankruptcy wane sharply after losing two of its original customers, Cox Communications and Comcast. The cable operators are bowing out of their contracts with Excite next June. With creditors closing in, Excites board agreed to hire an investment bank to review financial options and restructuring plans.
Reeling It In
Terremark Worldwide arranged a $48 million line of credit from Ocean Bank, but needs to look elsewhere for another $12 million to continue operating NAP of the Americas, said Jose Segrera, Terremarks acting chief financial officer. The center is envisioned as a major data exchange hub for U.S. and Latin American traffic, and claims signed contracts with 36 carriers.