Monday, October 02, 2006
Switch & Data filed for a $150M IPO. Interesting, considering they used to have more revenue and had profit - and now they have less revenue and losses. "For the six months ended June 30, Switch & Data lost $5.8 million." This IPO is definitely so the VC funds can cash out. "It will use IPO proceeds to repay bank debt." [Luckily, Vonage has shown them that the market is still filled with fools looking for a quick payday.] And no mention in any articles about th eongoing lawsuits against S&D's leases, in which one lawsuit ended up with a $40M ding. Meanwhile, S&D is getting squeezed at a few locations, because their business model directly competes with the building owner. For example, S&D has 2 locations in 56 Marietta, a building telx bought. S&D has an issue getting conduit outside its space to connect to other people in the building. Telx tenants don't have that issue. On top of that, a new generation of data center is being built by the search engine companies like Google and Ask, who lease mucho space from companies like S&D. Jon Price of ISPCON points this out in his blog post about a Wired article: "In fact, if you thought 1&1 was a threat to your shared hosting account and domain service package, I've got news for you AND 1&1, it's over."