Spot the ISP don't panic over NorthPoint letters → Telocity press release

Contacts:
Bill Chandler, Telocity, (408) 863-5983, bill.chandler@telocity.net
Debbie Mesloh, Telocity, (408) 863-5574, Debbie.mesloh@telocity.net

TELOCITY WORKING TO MINIMIZE IMPACT OF THE OUTCOME OF NORTHPOINT BANKRUPTCY PROCEEDINGS ON CUSTOMERS

CUPERTINO, CA (March 22, 2001) – Telocity (NASDAQ NM: TLCT), a leading nationwide provider of residential broadband services, announced the steps it is taking to help customers who will be affected by today’s outcome of NorthPoint’s bankruptcy proceedings.
Telocity has already begun switching its customers served by a DSL connection provided by NorthPoint to other last-mile carriers.
As a result of today’s ruling in the bankruptcy court regarding NorthPoint’s assets, AT&T has purchased NorthPoint’s national DSL network and NorthPoint’s hard assets only. This will impact the Telocity customers who had their lines installed through NorthPoint.
“The filing of Chapter 11 by NorthPoint was unfortunate in and of itself; the outcome of the bankruptcy proceeding comes as another piece of difficult news to the ISP customers served through NorthPoint,” said Ned Hayes, Telocity’s Executive Vice President and Chief Financial Officer. “As a result, Telocity is working around-the-clock to minimize the impact this situation will have on our customers. This is an unfortunate situation, but we are already in the process of switching our customers to the last-mile carriers we work with regularly.”
Since its inception, Telocity has employed agreements with a variety of last-mile providers to ensure the widest footprint and most reliable service possible for its customers. Telocity currently works with five last-mile carriers nationwide.
Tomorrow Telocity will send emails to all of its customers to describe the bankruptcy ruling and to outline the steps it is taking to transfer the current customers served through a NorthPoint connection to other carriers. In addition, Telocity will assure its customer base that this problem is limited to the NorthPoint customers only. In the emails, Telocity will also give customers a special Web site address and a toll-free telephone line to answer all customer questions.
Telocity is exploring several options, from negotiating with the new owner of the circuits to keep the network active until the customers can be switched, to aggressively working with an ISP coalition to potentially fund the operation of NorthPoint’s network during an orderly transition period.
“Our priority during this process is to ensure our customers are affected as minimally as possible, and that is what we are working around-the-clock to accomplish,” said Hayes.
Telocity’s long-term viability in the residential broadband space is assured with the announcement of Telocity’s pending acquisition by HUGHES Electronics. HUGHES plans to bundle Telocity’s DSL services and DIRECTV to create a “whole house” entertainment and information solution that will offer consumers the largest number of channels available plus value-added broadband services -- all via one home portal and without geographic limitations.

About Telocity
Telocity is a leading nationwide provider of integrated residential broadband services. Telocity improves today’s dial-up, or narrowband, experience through faster and reliable services that enhance Internet surfing, shopping and communications. Telocity intends to expand its broadband services to packaged value-added services that may include secure telecommuting, home monitoring and automation, voice bundling, and entertainment
services. Telocity currently provides high-speed broadband services through DSL technology. As Telocity expands its services nationwide, the company intends to choose the most reliable, flexible and cost-effective broadband access technologies (including DSL, cable, and wireless) available in each local market. Telocity’s current broadband footprint covers over 150 major U.S. Metropolitan Statistical Areas (MSAs) across the United States. Telocity recent announced that HUGHES Electronics Corp., the world's leading provider of digital television entertainment, satellite services and satellite-based private business networks, will acquire Telocity to expand its ability to offer Internet and broadband services to consumers throughout the United States. With the acquisition of Telocity, HUGHES will be the country's first provider to offer on a national basis a portfolio of consumer entertainment and information services that includes digital multi-channel television, and wired and satellite broadband Internet access. For more information, contact Telocity at phone (408) 863-6600; fax (408) 777-1451; www.telocity.net, or mail at 10355 N. DeAnza Blvd.; Cupertino, CA 95014. For more information, contact Telocity at phone (408) 863-6600; fax (408) 777-1451; »www.telocity.net/, or mail at 103455 N. DeAnza Blvd.; Cupertino, CA 95014.

Safe Harbor
Investors are cautioned that statements that are not strictly historical constitute forward-looking statements, including, without limitation, statements regarding the expected acquisition of Telocity by HUGHES, statements regarding value-added services and the expectations therefor, and product plans and performance. In accordance with the Private Securities Litigation Reform Act of 1995, important factors that could cause Telocity's actual results to differ materially from those expressed or implied by such forward-looking statements include but are not limited to the pending acquisition of Telocity by HUGHES, the highly competitive and evolving nature of the broadband market, the availability of financing, the ability to satisfy the conditions to the tender offer and merger, the successful deployment of Telocity's rollout plans and strategies, customer demand for Telocity's services in target markets, the pricing environment for Telocity's basic and value-added services, and the success of the company's strategic relationships. Readers are encouraged to review Telocity's recent filings with the Securities and Exchange Commission, including the Schedule 14D-9 filed by Telocity, Offer to Purchase filed by DIRECTV Broadband Inc., Telocity's current quarterly report on Form 10-Q, and its other filings with the Securities and Exchange Commission, copies of which may be accessed through the SEC's web site at »www.sec.gov.
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Here's a copy of the email I got from Telocity:

quote:

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Dear Friend:

Thank you for your interest in Telocity and your question(s) regarding Northpoint. We have anticipated your questions, yet might not be able to answer your detailed questions today. We will continue to update both active/installed Northpoint customers, as well as customers with Northpoint orders in progress. The following are a list of Frequently Asked Questions and Answers for your review.

Best regards,

Telocity Customer Care

Question: How do I order service with Telocity if you're not placing orders with Northpoint?

Unfortunately, Northpoint's bankruptcy means that we are unable to take orders in some areas. To check your availability, please visit our website at www.telocity.com
.

Question: What's going on with Northpoint?

As a result of bankruptcy proceedings, Northpoint Communications has sold its nationwide data network to AT&T. Because AT&T does not intend to use this network to deliver DSL service, this event will have a significant impact on both existing and pending Northpoint customers. Telocity is working on two fronts to minimize this impact to our customers: (1) we are negotiating to maintain the existing DSL service currently provided by Northpoint's network, and (2) we are ordering new DSL lines for all of the affected customers.

Question: How do I know if I'm a Northpoint customer?

The wall jack for all Northpoint DSL lines is labeled with the word "Northpoint."

Question: My DSL line wasn't delivered by Northpoint. Will this affect me?

No, there is no impact to customers whose DSL line was not installed by Northpoint.

Question: My DSL line was delivered by Northpoint. Will the speed of my DSL service change?

The speed of your DSL line may change, depending on which of our alternate circuit providers can install a new circuit to your residence.

Question: I have an order, but no DSL service yet. Will this affect me?

If the order for your DSL line was placed with Northpoint, we have placed a new order for a DSL line to your home with a different circuit provider. We are currently estimating that it will take an additional 4 to 8 weeks for this circuit to be delivered. Because the purchase of Northpoint's network will have a nationwide impact on DSL orders, it's unlikely that placing an order with another DSL provider would allow you to get service more quickly.
Although this event delays the delivery of your DSL service, we are working to push these orders through as quickly as possible.

Question: Is Telocity going to go bankrupt, too?

No, Northpoint's bankruptcy will not affect Telocity's financial stability.

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Here is the letter I got yesterday from Telocity.

Dear Telocity Customer,

We are writing with some urgent and unfortunate news about your DSL service.
As you may know, NorthPoint Communications installed the DSL line to your
home. A bankruptcy ruling involving the sale of NorthPoint's national DSL
circuit network has been concluded. The winning bidder who purchased
NorthPoint's national network has decided to suspend its operations
immediately.

This unexpected event will most likely mean you will lose your DSL
connection within the next week, but we are working hard to transfer you to
another carrier as quickly as possible. (If you are unsure if this affects
you, please check the wall jack into which your gateway is plugged.
NorthPoint wall jacks are labeled with "NorthPoint.")

We wanted to inform you right away and to assure you that we are doing
everything we can to minimize disruption for you.

TELOCITY IS ALREADY TAKING STEPS TO MINIMIZE DISRUPTION
Telocity is working around-the-clock with other line providers to enable you
to resume service as quickly as possible after that time. Depending upon
how the NorthPoint network is suspended, you should be able to access your
Telocity account for the next five to seven days.

TELOCITY WILL TRANSFER YOUR LINE TO ANOTHER CIRCUIT PROVIDER
Telocity must transfer you to another circuit provider in order to resume
your service. We will take care of this entire process for you. You do not
need to do anything at all to activate this process. We will place your
order with another circuit provider by the end of today so your service is
resumed as quickly as possible. It will take approximately 4 to 8 weeks to
transfer your service to another line provider.

You will Not be Billed for Disruption of YOUR SERVICE
You will not be charged for Telocity service during those times when your
service is interrupted as a result of the NorthPoint bankruptcy. When
your account is resumed, Telocity will provide you a credit for one month of
service at no charge.

YOU CAN ACCESS YOUR EMAIL
You can continue to access your email by going to
.

We Will Keep You Constantly Updated
We will continue to contact you through the postal mail service with regular
updates. We have also established a special Web site and 800 number to
ensure you receive the most up-to-date information.

For updates and information, please go to: . The
dedicated toll-free number is 877-629-4513.

We sincerely apologize for this inconvenience and we understand this is a
frustrating situation. We value you as a customer and will work as
quickly as possible to resume your service. We look forward to continuing
to serve you.

Sincerely,

DSL Assistance Team
Telocity, Inc.

Dear Telocity Customer,

You may have heard or read in the news lately about the bankruptcy of
NorthPoint Communications, a company that installs DSL lines to homes.
NorthPoint's hearings have been concluded and its national DSL network was
sold. We wanted to update you about the situation and describe how it will
affect only those Telocity's customers whose lines were installed by
NorthPoint.

WE ALSO WANT TO ASSURE YOU THAT YOUR SERVICE WILL NOT BE AFFECTED AT ALL.

Telocity contracts with NorthPoint and several other carriers around the
nation to install DSL lines into the homes of our customers. This
flexibility with last-mile providers gives us the ability to move customers
from one carrier to another, if necessary.

NorthPoint customers had separate lines run to their home for their DSL
connection. Customers who had their DSL line provided by NorthPoint have
jacks that are labeled "NorthPoint." To confirm that you will not be
affected by the NorthPoint sale, we have set up a service check feature for
you at our Membership site. Simply go to ».home.telocity.com and
enter your user name to confirm your status. This site will also provide
you the most comprehensive and up-to-date information about this situation.
We ask that you go to this Website first for answers to your questions, as
we are trying to keep our phone lines open and available to help the
customers who may personally affected by this situation.

We will send a longer communication to the Telocity customers served through
NorthPoint to provide further details about how we will continue to serve
them. We are working around-the-clock with other DSL line providers to
address the problems created for our customers served by NorthPoint
installed lines.

We wanted to inform you right away. We ensure you will have the latest
information on this situation. We appreciate your business and we look
forward to continuing to serve you.

Sincerely,

DSL Assistance Team
Telocity, Inc.

The address given by Telocity (».home.telocity.com) does not make any sense.

The Telocity link was copied incorrectly.
To see if the demise of NorthPoint will effect you, visit »home.telocity.com and use the Telocity NothPoint Identification Tool to confirm whether or not NothPoint owns your line.

If you are a Telocity subscriber, visit »home.telocity.com and use their NorthPoint Identification Tool to determine whether or not you might be effected by NorthPoint's demise.

home.telocity.com just brings up their members site which advertises their upgrade feature. There use to be information and FAQ's regarding what it's doing for those people who had Northpoint as it's carrier. As of 4:39pm mst, Telocity is not posting any information.

I'm a Telocity customer who is connected through Northpoint. There's no information about this situation when calling tech support, no information on their web site, and I never received any communication via email from Telocity. Had poor service before this, and this situation hasn't been handled very well.