The news has been making the rounds that internet-over-television outfit NetChannel Inc, is in the midst of a financial meltdown and is in need of funding or a financial partnership to keep it out of Chapter 11 bankruptcy proceedings. The company denies that anything is drastically wrong and asserts that it’s proceeding as scheduled with long-term plans to seek financing. A spokesperson said that Chapter 11 is not impending and that none of the San Francisco-based company’s employees have been pink-slipped. That contradicts several reports that NetChannel’s chairman David Atkinson said that the company’s board of directors is considering a Chapter 11 filing, but hasn’t made a decision yet. The spokesperson also said the company is very close to the kind of long term deal that it’s been seeking and should be making an announcement shortly. Sales at NetChannel have never really arrived and the company has relied on continuous rounds of financing since its founding in May 1996. The long-term partnership, something which would effectively represent a fourth round of funding, has been in the works for some time. NetChannel says that spring of 1998 had always been its deadline for securing such a deal. Rumors were swirling around in past few weeks that America Online Inc was looking to buy NetChannel and create a combination that would instantly rival Microsoft Corp’s WebTV unit. It’s likely that AOL will end up being the financing partner announced although it wouldn’t comment on the speculation and NetChannel would only say that AOL would be a perfect fit for a partnership with the company. When asked about the situation at NetChannel, Randy Brasche, marketing manager for Network Computer Inc (NCI) – which supplies NetChannel with the software its boxes run – said only, the network is still up and that we don’t anticipate any interruption of service.
