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To: craig crawford who wrote (115637)	1/17/2001 11:51:07 PM
From: H James Morris	Read Replies (1) \| Respond to of 164684

Craig, your reminding me of KIS lately. Btw Lets buy anything DSL. >Bazillion.com, which closed its doors last week after failing to secure more financing, said yesterday it was in talks with strategic partners who might be interested in its business. The provider of high-speed Internet services dismissed its remaining 125 employees without severance pay Thursday after it failed to secure additional funding. At its peak last year, the Seattle company employed 160 people. The start-up, which had spent $50 million in venture capital since its inception, was seeking an additional $35 million to $50 million from Dallas-based investment firm Hicks, Muse, Tate & Furst. Another $6 million was available from an unnamed source if those discussions progressed, Bazillion Chairman Vern Fotheringham said yesterday. Internet hardware maker Cisco Systems also had pledged an additional $60 million contingent on the Hicks Muse funding, he said. But those hopes collapsed when Hicks Muse refused to agree to initial terms for an investment, forcing Bazillion to close quickly. "We had nothing available (for employee-severance pay) when the existing investors did not see the Hicks Muse deal go to a term sheet," Fotheringham said. Hicks Muse declined to comment. New York-based Riverside Management Group, which supplied a large portion of the initial $50 million that is now lost, wasn't available to comment. Bazillion had attracted 5,000 subscribers since its inception, promising fast Internet access and 400 minutes of long-distance calls for $49.95 a month. Its voice network reached 60 percent of the U.S. and was popular with some users. But Bazillion hit the same difficulties that have beset other digital subscriber line providers, who claim competition from phone companies is eroding their business. Those companies are required to open their networks to the likes of Bazillion, but also offer competing service, which dulls their incentive to cooperate in installing the lines that link competing subscribers to the main phone networks. "They practice strategic incompetence," Fotheringham said. "It's not against the law to be late for appointments." Spotty service in recent days alerted some subscribers to trouble at Bazillion. Many hadn't received an e-mail sent Saturday announcing Bazillion's closure, although they had paid for January service. "They could have left a machine on the phone saying we're gone," said Rob Hylton, a subscriber in San Diego. Fotheringham said he regretted any inconvenience to subscribers. What happens next depends largely on whether any companies are interested in parts of the business. If not, Bazillion could file for bankruptcy protection. Fotheringham did not name potential partners he is talking to. "We're looking at all the alternatives that would be available to protect creditors and employees and stakeholders," Fotheringham said. "That includes the possibly of a Chapter 11 filing. However, that's not been decided yet."