At Home Expects AT&T to Miss Customer Targets (Update1)
Bloomberg News
April 8, 1999, 12:53 p.m. PT
At Home Expects AT&T to Miss Customer Targets (Update1)
(Adds company comment in 4rd paragraph. Updates shares.)
New York, April 8 (Bloomberg) -- At Home Corp., which
provides high-speed Internet services over cable-television
lines, said it expects AT&T Corp. and its affiliates to miss an
undisclosed target on June 4 for adding customers.
AT&T, the largest U.S. phone company, has a 71 percent
voting stake in At Home. Cox Communications Inc., Comcast Corp.
and Cablevision Systems Corp., three of the largest U.S. cable-TV
companies, also have stakes in At Home.
Cox and Comcast waived the right to drop At Home as their
exclusive Internet access provider because of the missed target.
In exchange, AT&T agreed that At Home's board couldn't take any
action without the approval of Comcast or Cox, with the majority
of board members. AT&T will also increase its subscriber target
for the 12-months beginning in June.
At Home has ''always been successful in building consensus
among our (board) members,'' said Matt Wolfrom, an At Home
spokesman. He declined to comment on the customer targets.
AT&T has agreed to pay an unspecified number of shares of At
Home to Cox if AT&T falls short of targets for adding customers
in the next 12 months, Cox said. The Wall Street Journal first
reported the news, citing unidentified people.
AT&T received its stake in Redwood City, California-based At
Home through its purchase last month of Tele-Communications Inc.,
the No. 2 U.S. cable-TV company.
Under the original At Home partnership agreement of 1996,
TCI promised to sign up tens of thousands of new customers for At
Home's Internet services. If it didn't, TCI was subject to
penalties, including the possibility that the cable partners
could end their contracts with At Home.
Shares of At Home fell 4 3/16 to 161 5/8 in late trading,
while AT&T dropped 11/16 to 84 3/16. Comcast's Class A shares
fell 29/32 to 66 5/8 and Cox declined 1 7/16 to 77 1/2.
|
