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This article does not cite any references or sources. (March 2007) Please help improve this article by adding citations to reliable sources. Unverifiable material may be challenged and removed. |
Contents |
Demon Internet
Demon Internet is a British Internet Service Provider. It was one of the earliest ISPs, one of the UKs first, especially targeting the "dialup" audience starting on 1 June 1992 from an idea posted on CIX by Cliff Stanford of Demon Systems Ltd. The branch in the Netherlands started in 1996, and was sold to KPN in June 2006. The business was financed early on by Internet pioneer David Tabizel of Durlacher and received substantial backing from Apax Ventures.
In the early days users were expected to connect to a BBS and download basic internet connection software based on the KA9Q implementation of TCP/IP. In 1995 the company acquired Chris Hall and Richard Clayton's Turnpike suite for Windows.
Its first service was the "standard dial-up" (SDU) - full TCP/IP access on a static IP address allowing users to receive SMTP mail and other IP traffic direct to their computers. It was possible to operate independently of Demon or to make use of Demon's mail, news, IRC, web-proxy, DNS, etc. servers.
The SDU was and still is priced at £10 a month plus VAT, described in the sales literature as a "tenner a month". They still offer this service at the same price today, but more customers today use ADSL.
In 1998 Demon was bought by Scottish Telecom, a wholly owned subsidiary of the private utility company Scottish Power. Scottish Telecom rebranded as Thus plc in October 1999 and floated on the London Stock Exchange. Thus plc fully demerged from Scottish Power in 2002. After the sale of Demon Internet to Scottish Telecom Cliff Stanford founded the company Redbus.
The public telephone number of the company, and many of the dialup access numbers, end with 666 (the supposed Number of the Beast), a deliberate pun on the name Demon. Also, after a spate of "access" related names (e.g. gate, post) many of its original servers' hostnames started with dis, being the initial letters of Demon Internet Services as well as the name of a part of Hell in Dante's Inferno and another name for Lucifer.
Early Days
Demon Internet was born of Demon Systems, a bespoke business software development company formed by Cliff Stanford, Grahame Davies and Owen Manderfield. In a discussion of the need for a home-oriented dialup IP service on the CIX boards, Stanford suggested that if 200 people stepped up with a year's subscription, he would use Demon's infrastructure to create such a service.
The original Demon service was hosted using mainly Apricot servers including a gigantic pair of LSI towers named "gate" and "post".
When Demon started WinSock was still a new concept. Most PC users had to use "KA9Q" or "NOS" - a command line style client - to establish their TCP/IP connection to use ftp, gopher, telnet, etc. The Worldwide Web had not yet arrived.
Thanks to Demon Systems, Demon Internet always had a strong programming team allowing it to create solutions to emerging issues in-house. All three directors were programmers and Stanford wrote many business-critical pieces of software, writing modules to adapt MMDF to Demon's purposes. Mark Turner, originally one of Demon System's developers, wrote many of the accounts and operational systems. As Stanford was increasingly absorbed with corporate activities, Neil McRae eventually took over the work on the mail system. Oliver Smith moved from Systems to Internet to run and automate services for corporate customers. Later on, Peter Galbavy was brought in to develop solutions for interoperability issues and Ronald Khoo developed low-level networking solutions that allowed the company to run on free operating systems and PC-based hardware.
Many other key Demon people started out as developers - Giles Todd, Clive Feather, Richard Clayton.
Armed with so many developers, many of whom made names for themselves within the developing industry, Stanford used the company's ability to contribute its developments to the Open Source community as a means of developing Demon's reputation beyond what its actual Internet Service commanded.
Because the Internet was still a relatively new phenomenon, the domain of academics and geeks, Demon's home-dialup focus was also its Achilles heel. British Telecom were very dubious of Demon's projected growth and did not provide for expansion, resulting in a regular shortage of lines and regular re-digs of the top end of Hendon Lane to lay down additional cables.
In June 2008 Cable & Wireless made a predatory offer for Demon's parent, Thus.
The bid of 180p a share values Thus at £361m, including debt.
Many investors are thought to be keen on a deal with C&W, as Thus has never made a profit or paid out a dividend. However given Cable & Wireless's track record of absorbing company's that have an excellent track record (eg Bulldog)and ending up with a much inferior performing operation customers of Demon may not be so pleased.
Last year (2007) Thus made a pre-tax loss of £2.7m on revenues of £576m.
A successful bid from C&W could prompt a clearout of senior management at Thus, starting with chief executive Bill Allan who is likely to leave with a seven-figure payout.
Allan is a former C&W veteran, racking up 26 years at the company before joining Thus in 1999. The company was floated on the stock market the same year valued at £2.5bn. With the dotcom boom at its height, the company even made it into the FTSE 100 the following year, but its value has shrunk steadily since.
It suffered a blow when it lost out to BT in a lucrative deal to provide home phone services to BSkyB.
The acquisition of Thus would lead to further consolidation of the business telecoms market and bolster C&W's British revenues as it works towards the demerger of its international assets.
