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Open Range Files For Chapter 11
Lights Out for Rural WiMax ISP
by Karl Bode 09:25AM Friday Oct 07 2011 Tipped by WHT See Profile
Yesterday we noted that WiMax ISP Open Range Communications was closing up shop, the company's CEO already having left the company and Open Range employees being informed their services were no longer needed. A notice on the Open Range website now notes the company has filed for Chapter 11 reorganization, directing users to this website for some additional detail on the filing. The company has not responded for requests for comment. In 2008 Open Range received a $267 million loan from the U.S. Department of Agriculture’s Rural Development Utilities Program to improve rural connectivity, followed by $100 million in equity from One Equity Partners.

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FFH5
Premium
join:2002-03-03
Tavistock NJ
kudos:5

Chapter 11 bankruptcy inconsistent with closing up shop

The fact Open Range filed for chapter 11 instead of a chapter 7 bankruptcy indicates they intend to stay in business. They listed having between $100 million to $500 million in assets. Of course staying in business may just mean they may be looking for someone to buy their infrastructure and takeover their customers. The fact that they didn't do this before filing for bankruptcy may mean they couldn't find a buyer willing to pay enough to sell to at a profit. But now those buyers may be interested in buying at a big discount.
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»www.rickperry.org/
openbox9
Premium
join:2004-01-26
Germany
kudos:2

Re: Chapter 11 bankruptcy inconsistent with closing up shop

said by FFH5:

The fact that they didn't do this before filing for bankruptcy may mean they couldn't find a buyer willing to pay enough to sell to at a profit. But now those buyers may be interested in buying at a big discount.

Bingo. If the company can shed some/all of the debt (another win for the taxpayers ) in reorganization, then it is more likely to be sold.

Kosh
We are all Kosh
Premium
join:2005-11-16
Z'ha'dum
Reviews:
·CenturyLink

Re: Chapter 11 bankruptcy inconsistent with closing up shop

Meh, the government loans they had were $267 million or so.

In perspective, we pay $428 million a day in Iraq and Afghanistan, (assuming my math isn't fuzzy). Not making a statement on the war, just sayin' we have bigger fish to fry, so to speak. I'm still not happy about the loss, but at least we have some additional useful infrastructure built in our country. Hopefully this will work out for their rural customers.
--
"I'm just a human being trying to make it in a world that is very rapidly losing its understanding of being human." - John Trudell
openbox9
Premium
join:2004-01-26
Germany
kudos:2

Re: Chapter 11 bankruptcy inconsistent with closing up shop

No doubt bigger fish exist, but every little penny helps As for useful infrastructure, I guess that depends on how the bankruptcy proceedings go and who wants to pick up the pieces.

BUCKEYECOM

@buckeyecom.net

Re: Chapter 11 bankruptcy inconsistent with closing up shop

this doesn't show they're going to close. They're getting rid of their debt. and Any carrier can come in and pick them up without a problem during that or after. And pick it up for CHEAP.
openbox9
Premium
join:2004-01-26
Germany
kudos:2

Re: Chapter 11 bankruptcy inconsistent with closing up shop

Yes, that was my point. It depends on who comes in and picks up the pieces
tmc8080

join:2004-04-24
Brooklyn, NY
Reviews:
·Optimum Online
·ooma
·Verizon FiOS

crafty, caveat emptor

however, banks, wall street and venture capital organizations have wide eyes & long memories of the history of a company... unless rural wimax is a profitable business, nobody will want it at ANY price. You don't see Verizon running like a bat out of hell to put LTE or other wireless in rural West Virginia do you?

perhaps some cherry picking in A&T's Bell South geographies might take a bite out of DSL/docsis 2 non-upgraded geographies. much higher density customer base and piss poor competition.

DaDawgs
Premium
join:2010-08-02
Deltaville, VA
Reviews:
·Metrocast Commun..

Re: crafty, caveat emptor

said by tmc8080:

You don't see Verizon running like a bat out of hell to put LTE or other wireless in rural West Virginia do you?

perhaps some cherry picking in A&T's Bell South geographies might take a bite out of DSL/docsis 2 non-upgraded geographies. much higher density customer base and piss poor competition.

Well said. You will never see Verizon go into rural markets because they understand that the money is in denser population areas.

I have said for many years that deploying the last mile of fiber/cable in this country will take as many years as it took to deploy the last mile of copper.

If it is not profitable for the Verizons because of their overhead, it is a business opportunity for the WISP community because their overhead is so much better managed. Verizon is like the defense department, they do not want for money to burn.

Rural WISPs are a viable proposition. It simply takes innovative management and competent engineering. Actually rural areas are the most promising for WISPs because they are not interesting to the Verizons or other "Cherry Pickers".
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Once we IPv6 enable every device on the Internet we will have toasters, baby monitors, and security cameras joining the bot nets which today are populated only by idiots that can not refrain from clicking, "Yes I would like to see those titties..."

Kosh
We are all Kosh
Premium
join:2005-11-16
Z'ha'dum
Reviews:
·CenturyLink

Golden Parachute for the Execs?

Just curious if anyone knows, was there a big severance package for CEO Bill Beans? I couldn't find any info on that, lol.

Looks like they had a government loan of $267 million, and another $100 mil from Government Chase bank.

»www.bizjournals.com/denver/stori ··· page=all

I loved this quote from the CEO last year:

“Getting the financing took five years,” he said. “In one year since then, we’ve taken a company from being on PowerPoint to building a whole back office, the front office, the networks and the middle mile, too.”
...and another year to file for bankruptcy protection. Epic lulz.
--
"I'm just a human being trying to make it in a world that is very rapidly losing its understanding of being human." - John Trudell

knightmb
Everybody Lies

join:2003-12-01
Franklin, TN

It's tough out there

Running an wireless ISP is certainly tough, but companies like this remind me how much waste can happen when you let technology get out of control. I'm sure they were using only the most expensive (but not necessarily better) tower equipment, renting towers at insane rates instead of building their own, etc. I've seen it happen to many a wireless ISP companies around me.
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WHT

join:2010-03-26
Rosston, TX
kudos:5

Re: It's tough out there

said by knightmb:

I'm sure they were using only the most expensive (but not necessarily better) tower equipment, renting towers at insane rates instead of building their own, etc.

There's a WISP the next country over that got a grant for WiMax and the local 2.4/5.8 WISPs still beat their pants off.

DaDawgs
Premium
join:2010-08-02
Deltaville, VA
Reviews:
·Metrocast Commun..

Re: It's tough out there

said by WHT:

said by knightmb:

I'm sure they were using only the most expensive (but not necessarily better) tower equipment, renting towers at insane rates instead of building their own, etc.

There's a WISP the next country over that got a grant for WiMax and the local 2.4/5.8 WISPs still beat their pants off.

There is truth in that. It ain't about the licenses you hold. It is about the engineering staff and management's ability to pay attention to them... or not.
--
Once we IPv6 enable every device on the Internet we will have toasters, baby monitors, and security cameras joining the bot nets which today are populated only by idiots that can not refrain from clicking, "Yes I would like to see those titties..."