Silicon Valley PR slumps as broadband firms cut back

SAN FRANCISCO: The dot-com industry is not the only sector of the economy on a deathwatch. A tidal wave of layoffs has now hit broadband companies selling high-speed Internet access, and hi-tech PR firms and in-house departments are beginning to feel the ripple effect.

SAN FRANCISCO: The dot-com industry is not the only sector of the economy on a deathwatch. A tidal wave of layoffs has now hit broadband companies selling high-speed Internet access, and hi-tech PR firms and in-house departments are beginning to feel the ripple effect.

SAN FRANCISCO: The dot-com industry is not the only sector of the economy on a deathwatch. A tidal wave of layoffs has now hit broadband companies selling high-speed Internet access, and hi-tech PR firms and in-house departments are beginning to feel the ripple effect.

Excite@Home in Silicon Valley, which offers broadband Internet access through cable TV lines, last week announced it planned to eliminate 250 jobs, or 8% of its 3,000-strong workforce.

Citing a slowing market for online advertising, PR director Alison Bowman said some of the positions eliminated were within the in-house communications and PR ranks. She confirmed that her department had been downsized from 10 to six full-time employees, and that director of corporate communications Melissa Walia left the company in November.

Excite@Home does not intend to discontinue its relationship with its PR agency of record, Text 100. However, San Francisco general manager Ryan Donovan said the agency budget had been 'slightly' scaled back.

In Colorado, DSL provider Rhythms NetConnections, which in January announced layoffs of 450 employees - 23% of its workforce - took the opposite tack. Earlier this month, the company terminated its relationship with the Weber Group and brought its PR effort in-house. Weber Group's Palo Alto, CA, and Denver offices had serviced the Rhythms account since October 1999.

Like Silicon Valley's Covad Communications Group and now-defunct companies such as NorthPoint DSL, FlashPoint Technology and Zyan Communications, Rhythms has had a tough time keeping costs down and competing for customers with regional telephone companies.

Excite@Home has encountered similar difficulties, in addition to suffering a series of management defections and missteps.



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