Digital Island may drop Hawai'i
By John Duchemin
Advertiser Staff Writer
The owner of Digital Island, a high-speed communications network company founded in Hawai'i, is deciding whether to eliminate its Honolulu network operations and engineering center as part of a worldwide round of cost-cutting.
If Cable & Wireless, the British telecommunications company that bought Digital Island for $340 million last year, closes the former Digital Island headquarters, it would end the run in Hawai'i of one of the most recognizable local technology companies.
Digital Island is one of the few Hawai'i companies whose stock became wildly popular — and then crashed — during the Internet stock bubble of the late 1990s.
Cable & Wireless has merged Digital Island with Exodus Communications, another formerly high-flying telecom service provider. The parent company plans to consolidate Exodus and Digital Island operations and eliminate unneeded facilities, said Adam Martinez, an Exodus facilities manager who helps oversee the company's San Francisco Bay area network of data and communications centers.
The Honolulu center is one of many Digital Island centers that could be closed, Martinez said. A major factor is whether Cable & Wireless can end its lease at 1132 Bishop St., he said.
"Nothing is concrete yet, and whether we keep it depends on a lot of things: What employees, departments and locations we want," Martinez said.
He said a decision will be made by later this year. He did not know what the effect would be on the several dozen Honolulu employees, which include engineers and network operations staff.
The Honolulu center's operations manager, Ray Chan, was traveling and could not be reached for comment.
Digital Island in the late 1990s was the darling of the small Hawai'i high technology and telecommunications industry.
Founded by entrepreneur Ron Higgins, the company raised millions of dollars from local and national venture capitalists attracted to its plan of running a worldwide high-speed data network. Among the early investors was the state government's Hawaii Strategic Development Corp, which put in $450,000.
