December 1, 1998 1:25 PM PST

Prodigy names Trachtenberg to COO post

Prodigy Communications confirmed today that it appointed David Trachtenberg as its new president and chief operating officer.

As previously reported, Trachtenberg is leaving his position as MCI WorldCom's executive director of online marketing to join the online services company.

"Prodigy has many unique assets," said Trachtenberg in a statement today. "It's an industry leader with a national brand, broad distribution channels, and a substantial customer base. I look forward to joining the executive team."

In making the move, Trachtenberg will be leaving a company whose consumer Internet push is in limbo and will be going to a company that is reinventing itself after losing its top online position amid new Internet companies.

MCI, a major player in current telcommunications merger fervor, earlier this year sold its Internet business to Cable & Wireless at the behest of federal antitrust regulators. But MCI is not giving up on the Net business, MCI spokeswoman Kelly Seacrist said. "We are certainly going to be in the Internet business," she said. "We're committed to that market."

The company has retained a dominant role in business Internet services and backbone communications through its UUNet division, acquired by WorldCom about a year before the MCI merger. Its plans for the consumer market are less clear, however.

Seacrist failed to be more specific but a message on the MCI Web site says the company is in the process of developing a new home Internet service, which is expected to be available within the next few months. Already, the company has announced plans to roll out a nationwide high-speed digital subscriber line (DSL) network by the end of the year, targeting both business and home users.

Prodigy, on the other hand, is attempting to resurrect itself. The 15-year-old online pioneer in September announced its intentions for an initial public offering.

But Prodigy has been trying to jump start itself for some time, and whether it will be successful remains to be seen.

"It really hasn't shown the rapid customer growth that we've seen in MindSpring and Earthlink. And it has no acquisition policy. It simply intends to be a well run ISP that's profitable with its existing base of customers," said Peter Krasilovsky, an analyst with Arlen Communications.

Krasilovsky added that he was critical of Trachtenberg's tenure at MCI but that his name could nevertheless help Prodigy. "David didn't really have a successful track record at MCI but he will give good curb appeal for Prodigy's IPO."

Analysts have put Prodigy at less than 400,000 subscribers, representing a fraction of the subscriber base of its one-time rival America Online, which claims 14 million members.

 

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