Gigabell AG

» see gigabell.de as it lived, on the wayback machine

~ the eulogy ~

Trading was suspended at twenty past three on the afternoon of 14 September 2000. The following day Gigabell AG filed at the district court in Frankfurt, giving impending insolvency as its reason, and became the first company on the Neuer Markt to fail outright. Germany's growth market had been open three and a half years by then and had been sold to private investors as the future of the country. Gigabell went first.

The company started in 1996 as IPF.NET, short for Internet Provider Frankfurt, selling access and server hosting to businesses. It renamed itself Gigabell in 1999. The founder was Rudolf Zawrel, who had spent an earlier career as a Schlager singer and who ran the company under his stage name, Daniel David.

Two things underneath the holding company are worth remembering. One was OKAY.NET, a consumer dial-up account at a flat 25 marks a month on top of whatever the phone call itself cost. The other was a call-by-call business on the dial code 01036, big enough that Yahoo used the Gigabell platform for its own German access. In January 2000 the company announced it would buy half of dtg Deutsche Telefongesellschaft. A free service called freeOKAY.NET was announced for that summer and never launched.

The IPO had been on 11 August 1999 at 38 euros. The share went on to touch nearly 132. Losses were running ahead of revenue by the first quarter of 2000, which did not stop the chief executive telling the market in July that the year's revenue would quadruple to 127 million marks. On 25 August an English investor signed an agreement to put 48 million marks into a capital increase. The money never came. Three weeks later the company was in court.

~ the dossier ~

~ twenty-five marks a month ~

The flat rate was the argument of the year in Germany. A dial-up account had always cost money by the minute on top of the call, and the companies that started offering one fixed monthly price grew quickly and bled quietly, because the minutes underneath them were not fixed at all. Gigabell sold the fixed price and bought the variable one, and that trade was most of the business.

Where I was dialing from, the clock never came off. The account was metered and the call was metered on top of it, so the habit you built was knowing what you had come online for before you connected. Flat rate was a word I read about in other people's countries for years.

~ sloppiness ~

Dirk Pfeil, the administrator put on the case, made serious accusations against the founder and against the banks that had taken the company public, among them HSBC Trinkaus and DG Bank. Heise ran its report under a headline that translates as sloppiness at the insolvent provider Gigabell, and the detail behind it was that the bookkeeping was poor enough that the company's own assets were at times unclear. No court ever found fraud here. What the record holds is a share price moving on announcements while the figures went the other way.

~ the finnish ending ~

The operations and the customer base were sold out of the bankruptcy to the Jippii Group of Finland for 10 million marks, and the German business carried on as Jippii GmbH. Jippii had bought an operator that was already dead and nearly went down with it. By late 2001 the Finns had pulled out of Germany, and the Jippii name itself was in trouble at home.

No reliable subscriber number for Gigabell survives anywhere I could find, which tells you something about a company whose own administrator could not establish what it owned. The name is still in somebody's hands, too: a request to gigabell.de lands on a redirect into an ad network, twenty-six years after the court date.

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