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ISPs React to WorldCom's Demise

When one company serves 44 percent of the U.S. wholesale Internet market, that company's collapse is bound to create unease. We asked the experts on the ISP-Tech list how they'd react, and found calm rather than fear.

by ISP-Planet Staff [July 5, 2002]

Today, Friday July 5th, WorldCom is due to be delisted from the Nasdaq.

Many ISP professionals have mixed emotions as they watch the WorldCom monolith collapse under the weight of a multi-billion dollar accounting fraud. It's great to see the end of a company whose billing practices appear to have been notorious, but WorldCom's UUNet division retains the affection and admiration of many throughout the industry.

A report in February claimed that WorldCom had 44 percent of the U.S. ISP wholesale market. The company is huge. What would happen if problems occured at the company?

We asked the members of the ISP-Tech list, most of whom are network decision makers at small- and medium-sized ISPs in North America and around the world, "Would you disconnect from UUNet? Are there places in the US where UUNet's all there is?"

One respondent in Canada said that UUNet's prices were high, and customer service was poor. With irony, this Canadian noted, "the likelihood of my becoming a UUNET customer has not been affected by this recent scandal."

A respondent in the U.S. wrote of being billed for six months after canceling a leased line contract with WorldCom, and also of other recurring billing disputes with WorldCom's MCI unit.

Another member of the list noted, "What's sad is that the people losing their jobs are the ones who worked hard. The perpetrators seem to have cashed in nicely." The respondent added that the company they work for is not worried about any potential shut down because their company has always believed in multihoming, designing a network with more than one carrier at every critical junction so that if one of the carriers goes down, traffic will simply flow through the other.

Some jumped to the company's defense. One respondent wrote to us, "Despite its high prices, UUNet is quite good. I broker VoIP deals and virtually all the carriers use UUNet because it offers superior performance in terms of latency and packet loss on international routes."

Another wrote, "Why would you leave if the service is good? Do you really think WorldCom is just going to get turned off?

Returning to the original question, one respondent noted that some cities in the Western areas of North Carolina might get cut off if UUNet shut down.

Perhaps what's most disturbing about WorldCom is that it was little different from the other incumbent telephone companies. It provided poor service to small customers, but so did others. It would continue to send bills after disconnecting service, but so do other phone companies. Its prices seemed high to many ISP operators across North America, but so do the prices of other phone companies.

Given recent accounting revelations at WorldCom, Global Crossing, and to a lesser extent at Qwest, we may find that WorldCom's fraudulent accounting practices were also an industry norm.

— End