The stream of bad news flowing from WorldCom has left network managers concerned about potential lapses in their Internet services, and they're searching for strategies to ensure that they don't fall victim to WorldCom's failures.
"We've received lots of inquiries from WorldCom customers and all of them are concerned," said Lisa Pierce, a research fellow with Giga Information Group, a Cambridge, Mass., research firm. While keeping a wary eye on the troubled Internet services industry, network managers are monitoring their service providers more closely than ever before. They are setting up backup plans to make sure their access to the Web continues uninterrupted. But as the list of defunct Internet service providers and Web hosting companies lengthens, some are finding it a challenge.
Dan Agronow, vice president of technology for Weather.com, Atlanta, the online component of the Weather Channel, uses colocation services from UUNet, the WorldCom subsidiary that provides ISP and Web hosting services to Internet giants such as AOL Time Warner Inc. He is monitoring his service closely but remains satisfied.
"The service has not changed," Agronow said. "I talk with our representative once a week and we get very reliable, consistent service. There have been no problems or outages."
Contingency plan a must
Nonetheless, Agronow said he would be remiss if he were not looking around for a contingency plan. That, he said, is part of business, regardless of the headlines his service provider generates.
Lloyd Taylor, vice president of technology at Keynote Systems, San Mateo, Calif., Systems, which provides Web monitoring services, said that with 2,000 customers in 100 cities, his company cannot afford an outage. Even before the bad news from WorldCom, Keynote employed three different backbone providers and managed the routing itself.
AOL and Earthlink, an Atlanta-based ISP, have taken a similar approach, contracting with a number of hosting services to ensure that if anything goes wrong with one, they can turn to another, so customers do not experience problems. Linda Beck, Earthlink's executive vice president of operations, said that redundant systems have been a normal part of Earthlink's strategy for some time.
But in an environment where new accounting scandals and Securities and Exchange Commission investigations seem to break every week, and the ISP and Web hosting industry continues to implode, finding a safe alternative can be a problem.
For example, AOL employs both Qwest and Genuity. Qwest is under an SEC investigation, and many believe Genuity will file for bankruptcy protection imminently.
Keynote's Taylor said that companies must be much more aware of potential shortcomings with any single service provider.
"As the level of uncertainty grows, companies have to take more hands on responsibility for their own business," he said. "The days of outsourcing and trusting that alone are long gone."
Finding an alternative difficult
For some global companies, finding a replacement for WorldCom may be a challenge. WorldCom offers one of the industry's most complete international ISP and Web hosting packages. Any replacement will likely involve a number of service providers to help fill in the gaps, said Forrester Research principal analyst, Maribel Dolinov.
The core of WorldCom's ISP and hosting services comes from the 1996 acquisition of UUNet. UUNet also operates the largest share of the Internet backbone. In the midst of WorldCom's gloom, it has remained one of the company's bright spots.
WorldCom spokeswoman Debbie Lewis dismissed concern over WorldCom's services. The bankruptcy has not had an impact on UUNet's ability to deliver service, she said.
But some analysts said customers should be wary. While UUNet has a solid track record as an integrated part of WorldCom, it is hardly immune to the bankruptcy and financial problems that plague the company, Dolinov said. As a result of the company's recent financial restatements, WorldCom's debt-to-equity ratio has changed, which may make banks less inclined to lend money to the company. And with WorldCom in bankruptcy, the debtors will have a much larger say over how the company restructures. While UUNet is a strong point for WorldCom, there is some possibility that the unit may be sold off, Dolinov said.
All that means is that the level of customer uncertainty will continue to rise. But in the short term, there is almost no chance that UUNet will simply close its doors, Dolinov said. Fears over UUNet's closure and the potential problems that its closure would cause the Internet backbone are simply unfounded, she said.
Pierce agrees that the short term looks good for UUNet.
"I'm not suggesting that customers run away screaming from UUNet, but you should not just have a contingency plan, but be as close as you can to throwing the switch," she said.
Keeping records important
In addition to developing an exit plan, Luis Medina, an independent network consultant based in Burlington, Mass., said that WorldCom's customers should be vigilant in keeping records of any changes in performance and customer service. Users should keep in regular contact with their WorldCom representatives.
Though Weather.com's Agronow is happy with his service from WorldCom, he said that one thing has changed in the months since the scandal broke. Now, when he looks for backups to WorldCom, he has a new criterion to consider. On top of the company's track record, service agreements and price, he now spends time looking at the company's financial picture, something he paid little attention to before this summer.
"It's the prudent thing to do," he said. "I wouldn't want to move into a similar situation a year from now and have to do it all over again."