Things got a little tougher for the already beleaguered Excite last week. Cox Communications told its high-speed-data customers that it's severing its ties to the company and plans to offer its own high-speed-data service.

Cox e-mailed its HSD customers Nov. 14, saying it realized they were concerned about Excite's precarious financial status. ?Rest assured we are taking all the necessary steps?(to create) a new Cox-managed network,? the e-mails said.

The MSO has been preparing to take its data service in-house for some time, but stepped up its efforts after Excite filed for bankruptcy protection Sept. 28. Cox began its first multiple ISP technical trial with EarthLink and America Online in September in its El Dorado, Ark., system; the trial is expected to last six months. Cox chose that system because the El Dorado property isn't part of the Excite network. Cox acquired the system when it bought TCA Cable TV two years ago; the MSO offers its own Cox Express HSD service there.

Cox and Comcast Corp., both charter Excite affiliates and at one time part owners of the company, have been trying to extricate themselves from the financially strapped Excite for months. Both operators said earlier this year that they would sever their exclusive affiliation deals with Excite on Dec. 4 and would back out of their contracts completely when they expire in June 2002.

Cox began officially shifting away from Excite the day after the HSD company filed for Chapter 11.

?Cox customers like our products and they trust our brand,? Dallas Clement, Cox's SVP-strategy and development, told Cable World last month. ?We'd like the Cox brand to be more visible in some shape or form with this service.?

Since then, the company has been putting together the infrastructure necessary to take its high-speed data service in-house. Last week, the MSO made it official by telling customers to expect a new Cox-branded HSD service soon.

Meanwhile, Excite reported last week that it added some 417,000 new North American customers in the third quarter, for a total of 3.69 million. The company, which was expected to post its full results Nov. 19, told analysts last week that it would record a $271.3 million third-quarter total net loss. The latest net operating losses, which excludes nonoperating, reorganization and other costs, totaled $51.2 million for the period. The company recorded a $41.6 million pro forma loss for the third quarter of 2000. Revenues also slipped, totaling $138.4 million in the latest quarter compared to year-ago pro forma revenues of $169.9 million. The company had $157 million in cash and short-term investments as of Sept. 30; some $140.1 million of that total is unrestricted.

The company managed to bump its revenue in October after it cut deals with its cable affiliates, which agreed to pony up more money if Excite resumed pro-visioning new customers. The high-speed-data company had refused to sign on new customers unless the affiliates made up-front payments. Those contracts expire Nov. 30, and the company said in a filing with the Securities and Exchange Commission last week that there is no assurance that those contracts will be extended or renewed.

At the same time, Excite continues to shed assets. The company may have found a buyer for its Excite portal. Bellevue, Wash.-based InfoSpace, an infrastructure provider, is willing to put up $10 million for the asset and then turn it over to Irvington, N.Y.-based iWon.com, a Web portal company. InfoSpace would manage a new Excite.com portal. The buyer is expected to get domain names, trademarks and user traffic, but no physical assets. The bankruptcy court must still approve the deal. But $10 million is a fraction of the $7.8 billion paid for the portal two years ago.

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