SoftNet Systems Solutions Inc. reported that revenue for
its just-completed fiscal year more than quadrupled, while its net loss soared, due partly
to the costs of deploying more cable-modem systems.
The San Francisco-based broadband-services provider
reported a net loss of $50.5 million for the fiscal year ended Sept. 30, including $12.9
million in noncash stock-compensation charges. That compared with a year-earlier loss of
$17.3 million, including $27,000 related to stock options.
SoftNet said the figures also reflected higher capital
spending due partly to accelerated growth in turnkey cable-modem-system deployments by its
ISP Channel unit, which saw its customer base rise by 82 percent in the company's last
quarter, to 7,376 subscribers and 62 cable headends.
As of Nov. 30, ISP Channel had more than 9,000 customers
and 67 cable headends deployed. Through the end of its fourth quarter, ISP Channel had
2.45 million contracted homes passed with cable-operator affiliates and 562,000 marketable
Besides increased costs of sales, operating expenses
increased due to engineering expenses from around-the-clock staffing of SoftNet's
network-operating center and its new field-engineering services, plus sales and marketing
costs from increased staffing and new national and regional advertising campaigns.
Total operating expenses rose to $48.6 million from $10.2
million a year earlier.
Total revenue for SoftNet rose to $4.14 million in the year
ended Sept. 30, including $1.35 in the fourth fiscal quarter, compared with $1.02 million
for the previous year.
SoftNet said its Intellicom satellite-data network,
acquired in February, totaled $1.6 million of revenue since then, including $511,000
during the final quarter. Intellicom has installed 98 very-small-aperture-terminal
satellite systems, including 25 that serve ISP Channel.
Also last week, SoftNet named Compaq Computer Corp.
technologist Andrew Cromarty as its chief technology officer.
SoftNet indicated that Cromarty would have a crucial role
in the company's plans for expanding its product line beyond the cable platform. He will
be responsible for defining SoftNet's technology strategy, creating new services and
products and directing research and development.
At Compaq, Cromarty worked for the Network Systems
Laboratory, which is best known for creating the AltaVista search engine, and for the
Internet Exchange, where he focused on such areas as new Internet-service business models
and high-performance multimedia internetworking.
Before Compaq, Cromarty founded and managed a provider of
commercial Internet services and contract research and development to government and
private-sector clients, and he held senior marketing, management and technology positions
at Advanced Decision Systems, a provider to the government of applied
artificial-intelligence expertise and systems.
"His business-strategy background and broad,
multifaceted Internet experience is an ideal fit with SoftNet," CEO Lawrence
Brilliant said. "As SoftNet matures and evolves into a 'broadband everywhere'
company, we are pleased to have a chief technology officer of the caliber and
technological prowess that Cromarty brings to the post."