CacheFlow speeds onto
Road Runner's highway
By Owen Thomas
Red Herring Online
April 29, 1999
The giants of the cable industry are waging boardroom
wars -- but for the technicians set on wiring the world
with cable modems, it's business as usual.
Today, CacheFlow announced that
it has inked a $5 million deal with
Road Runner, the second-largest
cable Internet service. Over three
years, Road Runner will buy and
install the Sunnyvale company's
hardware-based "Internet
accelerators" throughout its
network.
Road Runner, a joint venture of Time Warner (NYSE:
TWX), MediaOne (NYSE: UMG), Microsoft (Nasdaq:
MSFT), Compaq (NYSE: CPQ), and
Advance/Newhouse, has signed up 250,000 subscribers
for its high-speed service to date, and is marketing its
services to the 8 million households served by Time
Warner and MediaOne that have Internet-ready cable
connections.
@Home Network (Nasdaq:
ATHM), owned by a competing
cable consortium, has
approximately twice as many
subscribers, but has lagged in
meeting subscriber growth targets.
As a result, lead investor AT&T
(NYSE: T) has had to cede more
control to fellow investors Cox
Communications (NYSE: COX)
and Comcast (Nasdaq: CMCSA). Road Runner,
meanwhile, has been exceeding expectations for
signups, according to the company.
CORPORATE POLITICS
The rival cable services are building out their networks
even as their parents wage a high-stakes corporate war.
Comcast bid to merge with MediaOne last month, only
to see AT&T offer a $58 billion cash-and-stock deal for
the cable system. According to reports, Comcast is now
seeking the help of Microsoft -- a Road Runner investor
-- and America Online (NYSE: AOL) in besting
AT&T's bid. Either bid could recast the broadband
Internet landscape.
The uncertainty over who will control both services isn't
slowing down their investments, however. "We still have
the same course of action," says Steve Van Beavers,
Road Runner's senior vice president of operations.
CacheFlow isn't the only company to seize an
opportunity in broadband infrastructure. Last year,
@Home linked up with Inktomi (Nasdaq: INKT) to
build Inktomi's software-based Traffic Server into its
network; more recently, it signed a deal with AT&T to
host its bandwidth-hungry Net backbone.
In February, Inktomi also signed up SoftNet (Nasdaq:
SOFN), an upstart cable- and satellite-based Internet
service provider, as a Traffic Server customer. |
