AT&T has already ploughed $3bn (£2bn) into the company and it does not want to invest any more capital into the struggling ISP.
However, the telecoms giant is reported to be interested in buying its network assets so its 1.3m cable customers can continue to access the Excite broadband service.
If AT&T does bid for the network, it is thought likely that it will make a similar offer to $315m (£213.7m) it paid for the assets of bankrupt US telecoms firm Northpoint.
Excite has $1bn (£678m) in debt and has a cash burn rate of between $20m (£13.6m) and $25m (£17m) a month. If it continues operating, it will run out of money by December.
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