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    PSINet Inc.
    list rank

    From the April 28, 1997 Washington Post


    '96 (in $ 000s) % Change From '95
    Revenue 89,800 131.9
    Net Income (55,100) --
    Rank Last Year: 96

    Description:
    PSINet sells connections to the global computer network known as the Internet. It also provides Internet-related technical services. It has business clients in the United States and abroad, including other Internet service providers, for whom it functions as an access "wholesaler." Its Internet access offerings range from dial-up telephone connections to special high-speed circuits. Its network covers 220 cities.

    Business Resume:
    • Contact Info --
      510 Huntmar Park Drive
      Herndon, Va. 20170
      703-904-4100
    • Main Business --
      Internet access
    • Founded --
      1989
    • Chairperson --
      William L. Schrader (CEO)
    • President --
      William L. Schrader
    • Employees --
      517
    • D.C.-Area Employees --
      275
    Developments:
    PSINet changed its corporate strategy last year, withdrawing from the consumer market and making the business market its sole focus. The company concluded that consumers were too costly to serve.

    The company struck a deal in June to transfer its consumer subscriber accounts to MindSpring Enterprises Inc., an Atlanta Internet service provider. That included the sale of the Pipeline business, which PSINet had purchased in 1995. PSINet said in July that MindSpring would pay $23 million by the end of the year, but the payment was pegged to the number of subscribers who actually transferred, and only about half of the subscribers were opting to go with MindSpring. As a result, the actual payment was significantly less, Chief Executive William L. Schrader said.

    The company recently sold its software subsidiary, InterCon Systems Corp., to Ascend Communications Inc. for $12 million, plus $8.5 million to repay debt that InterCon owed PSINet.

    In September PSINet formed a joint venture with investors George Soros and the Chatterjee Group to build an Internet network in Europe.

    Over the past year, the company replaced seven senior managers.

    PSINet's customers have been using 20 percent to 25 percent of the company's network capacity, and the network would become profitable when the volume reaches about 40 percent of capacity, Schrader said. That could happen in about a year, he predicted. The number of corporate customers grew to 17,800 as of Dec. 31 from 8,200 a year earlier.

    The company sees significant growth potential in some of its new services, such as one that allows businesses to send international faxes over PSINet's network at lower prices than with phone lines.

    Copyright 1997 The Washington Post

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