Digex

Digex

Industry	Telecommunications
Founded	1991; 34 years ago (1991)
Founder	Doug Humphrey Mike Doughney
Defunct	2003; 22 years ago (2003)
Fate	Acquired by Worldcom
Headquarters	Laurel, Maryland, United States
Key people	George L. Kerns, CEO & President T. Scott Zimmerman, CFO
Services	Internet service provider
Revenue	$187 million (2002)
Net income	-$246 million (2002)
Total assets	$220 million (2002)
Total equity	-$42 million (2002)
Number of employees	785 (2002)
Footnotes / references [1]

Digex, Inc. was one of the first Internet service providers in the United States.

During the dot-com bubble, its stock price rose to $184 per share; the company was acquired for $1 per share a few years later.^[2]

History

Digital Express Group, predecessor to DIGEX, was founded by Doug Humphrey and Mike Doughney in the basement of Mr. Humphrey's townhouse in Greenbelt, Maryland in 1991, offering web hosting services and Internet access.^[3]

In 1995, the company raised $8 million from Grotech Capital and Venrock.^[3]

In October 1996, the company became a public company via an initial public offering.^[4] The company employed 260 people by that year.^[5]

In 1997, the company was acquired by Intermedia Communications, a competitive local exchange carrier based in Tampa, Florida.^[6]

In 1999, Intermedia completed the partial corporate spin-off of Digex.^[7]

In 2000, Microsoft and Compaq invested $100 million in Digex.^[8]

In September 2000, WorldCom acquired Intermedia Communications and gained a majority stake in Digex.^[9]

In 2003, WorldCom acquired the remainder of the company.^[10]

Verizon acquired Worldcom in 2006 and integrated the company into Verizon Business.

Streaming media

In 1995, Digex launched ISP-TV, a network of linked CU-SeeMe videotelephony servers from multiple ISPs to provide for large-audience webcasts via streaming media.^[11]

In 1996, ISP-TV began producing original video content in one of the first "cyberstudios" in Laurel, Maryland. Shows included "Head" (a beer show) and "Meeks Unfiltered" with MSNBC correspondent Brock Meeks.^[12]

Digex also streamed Bud Bowl during the Super Bowl for Anheuser-Busch.^[13] In 1999 Apple hired Digex to stream the Star Wars trailer in QuickTime format. This industry first saturated the internet bandwidth at the time but proved that video streaming had a future.

References

1. "DIGEX, INCORPORATED 2002 Form 10-K Annual Report". U.S. Securities and Exchange Commission.
2. Handley, John (2005). Telebomb. Amacom. ISBN 9780814428894.
3. Swisher, Kara (April 10, 1995). "DIGEX FLOURISHES WITH INTERNET'S POPULARITY". The Washington Post.
4. Mullaney, Timothy J. (October 18, 1996). "Digex initial stock offering sells 4.5 million shares Md. Internet provider is worth $125.4 million". The Baltimore Sun.
5. Starzynski, Bob (October 11, 1996). "High-tech firms head to market". Washington Business Journal. Archived from the original on November 28, 2002. Retrieved November 20, 2023.
6. "Intermedia Will Acquire Digex In a $147 Million Stock Swap". The Wall Street Journal. June 5, 1997.
7. Noguchi, Yuki (September 6, 2000). "Deal to Give WorldCom Control of Digex". The Washington Post.
8. "Microsoft, Compaq invest $100M in Digex". American City Business Journals. January 12, 2000.
9. Deogun, Nikhil; Solomon, Deborah (September 5, 2000). "WorldCom Closes Deal to Buy Intermedia, Gaining Control of Web-Hosting Business". The Wall Street Journal.
10. Clabaugh, Jeff (November 17, 2003). "WorldCom buys out Digex in dollar sale". American City Business Journals.
11. Neely, Esme (October 12, 1997). "Faster connections should boost use of video calls". American City Business Journals.
12. JOSSI, FRANK (May 1, 1997). "Live, from Cyberspace". Wired.
13. "Internet Pioneer and Co-Founder of Digex, Doug Humphrey, Joins Savtira Advisory Board" (Press release). PRWeb. March 23, 2012.