FIRETAP Experiment Comes to an End
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Like a 'Dear John' letter, only much more expensive, FIRETAP Communications officials told investors Thursday they were closing the door on operations by the end of June.
Homestore.com, a one-stop information and service site for the real estate industry, was a major investor in the broadband start up, providing a high-speed Internet access option to its customer base of realtors and online visitors.
The fate of FIRETAP employees is unknown at this time. The company Web site was shut down last night, before news of the closure was announced. No announcement was made, either, regarding the company's customers, who will need to find new Internet and telephone service by the end of the month.
Homestore.com and FIRETAP officials could not be reached for contact.
With offices at its headquarters in Thousand Oaks, CA; Scottsdale, AZ; Dallas; and Washington, D.C., the competitive local exchange carrier (CLEC) hoped to switch real estate professionals and consumers to its offering. The CLEC opened its doors to business in May 2000.
The company made all the right moves, bringing in a founder of DSL reseller Rhythms NetConnections, Eric Geis, to head up operations and signing an alliance with America Online, Inc., to provide co-branded Internet service.
Unfortunately, the service never found traction with potential customers or its own members in the real estate business and funding by investors like Encore Venture Partners wasn't enough to keep the company afloat.
The company said it would take a $6-9 million loss on its investment, a mostly non-cash one-time charge to its second quarter earnings. According to officials, FIRETAP accounted for less than one percent of Homestore's first-quarter revenues.