Veteran internet service provider AppliedTheory Communications Inc has been looking for an investor for some time to help grow its network and its reach, and now it has found not one, but two. IXC Communications Inc has purchased a 34% stake in AppliedTheory and IXC investor Grumman Hill Investments III has bought an further 17% of the Great Neck, New York ISP. IXC paid somewhere between $10m and $15m for its stake. IXC is a Nasdaq-traded long distance telephony and internet network provider that recently signed an agreement with PSINet Inc – an AppliedTheory spin-out – to sell it 10,000 miles of OC- 48 capacity fiber in return for a 20% stake. Through yesterday’s deal, AppliedTheory gets access to IXC’s network, helping it on its path to building what it claims is the world’s first terabit per second network. IXC said it would be ready to talk about specific bandwidth issues in a couple of months. IXC gets access to AppliedTheory’s illustrious customer base, which includes Bank of New York, General Electric, Department of Labor and Eastman Kodak Co, as well as its expertise in internet technology. AppliedTheory was a 1996 spin-out from NyserNet, which was established in 1985 to link New York’s universities over the internet. Two years later NyserNet was the first company to connect commercial customers to the internet, including IBM Corp and General Electric Co. AppliedTheory did not return calls yesterday.
