Global Crossing

» see globalcrossing.com as it lived, on the wayback machine

~ the obit ~

i missed global crossing. the fiber it laid was thousands of miles of submarine cable for a corporate-and-carrier customer base i was not part of. in 1999 i was fifteen, on a 33.6k ttnet dial-up at home. the bandwidth war i was paying attention to was whether the cafe down the street had finally upgraded their cable connection so counter-strike pings would drop below two hundred. global crossing's forty-seven billion dollar market cap was happening on a frequency the consumer internet did not hear.

the company was founded in march 1997 by gary winnick, who had spent the eighties on the bond desk at drexel burnham lambert under michael milken before drexel collapsed. winnick took the playbook from drexel-era junk-bond financing and applied it to laying transatlantic fiber. the bet was that internet traffic was about to grow by an order of magnitude per year, and whoever owned the cables under the ocean would own the future of telecom. for two years it looked correct. global crossing went public in 1998 and was briefly worth more than ford motor company.

they laid roughly 100,000 miles of fiber across four continents, with atlantic crossing and pacific crossing as the headliners and a tangle of land-based links connecting them. frontier communications was acquired for eleven billion dollars in 1999 to get a U.S. footprint. a profitable quarter never arrived. the bandwidth demand projections that justified the build never materialized because compression got better faster than traffic grew.

~ the rap sheet ~

~ the postmortem ~

by late 2001 the company was bleeding billions a quarter against revenue of well under one billion. in january 2002 it filed chapter 11 with twelve-point-four billion in debt. at the time it was the fourth-largest bankruptcy in U.S. history, just behind enron, which had filed seven weeks earlier. the SEC opened an accounting investigation into how global crossing booked capacity swaps with other telecoms as revenue. gary winnick had already cashed out around 750 million dollars personally before the filing.

singapore technologies telemedia bought a majority stake out of the bankruptcy in 2003. the company limped on as a smaller B2B carrier for another eight years. in october 2011 level 3 communications absorbed the remnant for three billion dollars, and the global crossing brand was retired into the level 3 catalog. level 3 was itself absorbed by centurylink in 2017, which renamed itself lumen technologies in 2020.

~ the inheritance ~

the fiber is still in the water. most of the transatlantic capacity built during the bubble was so far ahead of demand that for almost a decade afterwards it sat at single-digit-percent utilization. the term "dark fiber" became a way to describe everything global crossing and its peers had laid that nobody was lit up on yet. by the late 2000s when youtube and netflix actually arrived, much of that dark fiber finally turned on, and the bandwidth glut that destroyed global crossing's revenue model was the same glut that made consumer streaming video physically possible.

winnick lives on a real estate empire in los angeles. the bondholders got pennies; the engineers who had laid the cables found new jobs at the buyers.

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