Bankrupt WorldCom may take the internet down with it. Theauction site eBay is already busy makingcontingency plans. "If the service ain't there, it ain'tthere. That's the bottom line," says eBay spokesman KevinPursglove. "It doesn't matter why or how it happened. Wejust need contingency plans to take care of customers."
In case of a WorldCom crash, eBay has spread out its e-mailson different servers, and found backup providers for critical jobs. And it?s notthe only one: Around the world, companies are interviewingbackup vendors and adding emergency clauses to business contracts. WorldCom owns MCI, the second largestlong distance provider and UUNet, which carries most of thetraffic on the internet.
"Although we do not expect any immediate cessation ofWorldCom services, its financial straits along with thepending layoff of 28 percent of its work force will resultin diminished service levels," says a recent report from theresearch firm Meta Group.
Wall Street is taking a hard look at communication companiessuch as Verizon and SBC. Michael Powell, chairman of the FCC, thinks the industry isin a state of "utter crisis" and expects more bad news. Thishas prompted a sense of imminent disaster at companies thatrely on Internet or cellphone connections.
"We know that the small providers are in trouble, but howmuch better off are the Sprints, Qwests and AT&Ts?? says Tom Jenkins, vice president ofTeleChoice. ?It's not a matter of switching from one to theother; it's a matter of protecting yourself from everyone.You can't predict anything anymore."
Things are bad in Europe as well. KPNQwest, a joint venturebetween Dutch carrier KPN and Denver-based Qwest, declaredbankruptcy in May. The network once covered 18 countries,from Finland to Portugal. Bankruptcy court trustees haveonly a short time to find a buyer for the company, whichcarries one-fourth of its region?s internet data. But mostpotential bidders, including AT&T, have backed out. KPNQwestinternational customers include Nokia, Dell Computer andNational Semiconductor. Eric Paulak of Gartner Research saysthe fate of WorldCom customers is "not as dire [asKPNQwest]--yet."
According to estimates, E-commerce companies could lose from$1 million per hour to $1 million per minute if the net goesdown. When Amazon.com suffered a series of disruptionsduring the Thanksgiving weekend in 2000, it?s estimated thatone 20-minute outage deleted 20,000 product orders and$500,000 in revenue. "Ask yourself, what are theconsequences of being down for one hour, one day, one week?"says Janis L. Gogan, who teaches computer informationservices at Bentley College. "There really aren't many largecompanies in this country that would be OK if they werewithout internet access for a week.?
Gogan thinks U.S. firms should copy the disaster plansdevised in India, where there is an unreliable power grid."If you don't already have a contingency plan, you shouldfind one immediately," Gogan says. "It might help to getcreative in where you look at how you pull it together."
Last week, a bulletin appeared on the KPNQwest site saying,"During this week you can already expect outages to happenthat we cannot solve any more. At the end of this week weexpect that larger parts of the network will be down." WillU.S. internet users see similar messages on their computerscreens soon?
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