Hughes Closes Telocity Deal
By Monica Hogan -- Multichannel News, 4/3/2001 12:07:00 PM
DirecTV Inc. parent Hughes Electronics Corp. said Tuesday that it has closed its acquisition of digital-subscriber-line provider Telocity Inc.
Hughes wants to be able to market both DirecTV television and a choice of high-speed-data services from Telocity or Hughes Network Systems' DirecPC operations.
Hughes said about 94 percent of Telocity's shares had been tendered by the close of business Monday. Shares of Telocity's common stock will cease to exist at the close of business Tuesday. Shareholders that did not tender their shares will receive $2.15 per share.
Telocity serves customers in 150 metropolitan markets through partnerships with last-mile DSL providers, including regional Bell operating companies and competitive local-exchange carriers.
Among its last-mile providers had been NorthPoint Communications Inc., which plans to shut down its DSL service. Telocity has assured customers that it will do its best to find alternative last-mile providers. In addition, the company won't bill for service missed, and it will offer a free month's service in the event of an interruption in service.
A DSL option can help DirecTV to compete more directly with cable operators that are aggressively deploying high-speed cable modems and a two-way interactive pipe for digital-cable television.
Making high-speed Internet access available to all homes across all DirecTV markets is something the company must do for competitive reasons, DirecTV global chairman Eddy Hartenstein said at 'The Big Picture' conference in New York Tuesday. He added that DirecTV plans to become a whole-house provider of services to its customers.
At least initially, the DSL service will continue to be branded Telocity. The subsidiary's headquarters will continue to be located in Cupertino, Calif.
No related content found.
VIEW ALL GALLERIES
