WorldCom woes

THESE DAYS, EITHER Dayne Sampson, vice president of IT at Emeryville, Calif.-based Internet search company Ask Jeeves, or someone on his staff is in daily contact with WorldCom, the troubled telecom carrier that provides co-location services from its New Jersey facility.

With questions in the air about the effect on voice and data services — due to the July 21 bankruptcy filing by the Clinton, Miss.-based voice and data service provider — Sampson is monitoring the situation closely.

Despite the uncertainty surrounding WorldCom’s fate, Sampson says he is prepared for any outcome from the bankruptcy. Ask Jeeves has access to more network connectivity from San Jose, Calif.-and London-based vendors. It is redundancy that ensures the company’s network is always on and guarantees the availability of its Web service, which gets about 5 million hits a day. Additionally, the vice president has recently experienced the flameouts of other service providers, so he has adjusted his IT contracts and contingency plans accordingly.

With the news remaining grim in the telco sector — the financial failings of WorldCom, Denver-based Qwest, Madison, N.J.-based Global Crossing, among them — CTOs are paying close attention to make sure they aren’t left without connectivity due to the untimely demise of their service providers.

Be prepared

Some chief technologists say they have been preparing for months for uncertainties in Internet service, data services, and bandwidth connectivity as a growing number of providers began to develop serious problems.

Immediately after WorldCom dropped a financial bomb June 25 — reporting it hid $1.2 billion in losses by failing to report $3.85 billion in expenses and that it would lay off 17,000 employees — Gartner issued a warning. The Stamford, Conn.-based research firm believes that more layoffs are to come, potentially reducing the telco to half its current size by mid-2003, provided the entire company or its units have not been acquired by others. Gartner is now advising WorldCom customers to make contingency plans to guarantee service while the giant telco’s fate unravels.

Although experts have historically debated the relative merits of having a single network provider (to foster a close relationship) vs. having two or more carriers, now is clearly the time to have more than one provider, says Ted Chamberlin, a Gartner networking analyst.

“This advice is definitely for WorldCom customers, who have some choices to make, but also for customers of Qwest, Global Crossing, and for the remaining CLECs [competitive local exchange carriers],” Chamberlin says. “For any customer of a network service provider, the potential is there for gloomy times. So we tell our customers that having a dual-carrier strategy is essential.”

Gartner also advised enterprise IT decision-makers who are currently signed up with WorldCom to delay signing up for new WorldCom services, to extend expiring contracts for only six months, to duplicate data, and to consider alternate hosts for Web sites currently hosted by WorldCom or its Digex affiliate (see “Avoiding voice/data service disruptions” ).

Although much of the telco news this year has been grim, Sampson says contingency plans at Ask Jeeves had been in place long before this year’s problems. “We started taking precautions some time ago — years [ago] — with redundant systems. We have centers in the United Kingdom, on the East Coast, and on the West Coast — and none share the same network.” Sampson declines to name the service providers used by his London and San Jose facilities.

Last year, Ask Jeeves survived brownouts during the California energy crisis and the bankruptcy of Web hosting service provider Exodus Communications without suffering an outage. Exodus was bought by the giant telco Cable & Wireless without interrupting service to customers. “We expect we’ll have the same situation with WorldCom,” Sampson says, adding that he doesn’t expect government regulators will allow one of the larger suppliers of the Internet backbone to halt its service.

Still, Sampson says he is leaving nothing to chance. “We are in daily contact with our WorldCom team and they have been extremely proactive in helping us and keeping us up-to-date on what’s going on,” he says. “And we’ve done due diligence … so any financial issue that WorldCom has, if it starts to impact technology operations, we’re in a position to make changes.”

Making changes

Some IT executives say they are ready to make changes if network service is indeed interrupted.

A CTO of a major health care provider, who asked that his name and company not be published, says he is looking for a possible replacement for Digex, the Web hosting company of which WorldCom has a controlling interest. With scheduled funding from WorldCom unlikely to come through, Gartner analysts expect Digex will have to raise funds to continue operations past the first quarter of 2003. In a statement in late July, Digex distanced itself from WorldCom, stating that it is a separate, publicly held company. Cash flow and funding commitments, however, were not addressed at the time of the announcement.

The CTO says Digex in the recent past had assured him of continued service, despite its financial problems. Still, as an alternative strategy he is evaluating is another Web hosting service provider. “We’re still working things out,” he says. “We’re considering another vendor.”

Not all enterprises are big enough to have redundant networks. At Housing Works, a nonprofit housing organization in New York, CTO Duane Ebesu has advice for other IT executives who may not have contingency plans — act now to find alternative service.

Ebesu says the bankruptcy filing in February of New York ISP Globix caught him by surprise, and the company didn’t provide him with enough warning of its financial problems. As a result, he switched to Verizon, hoping service from the larger company would be more reliable. Housing Works never lost network service, but Ebesu says he changed providers because of the uncertainty and the way Globix handled the situation.

The CTO says his repeated calls, asking if there might be services interruptions, were met with sound denials. “When Globix filed for bankruptcy, the way we found out about it was a form letter, although the industry had been talking about [the possibility],” Ebesu says. He was not pleased.

“I didn’t expect the carrier to say ‘We are going under in two months.’ But it was a slap in the face for them not to show a modicum of honesty and say, ‘You’ve been a customer for half a decade and there are going to be some changes,’ he says. That’s part of having good customer relationships. Is someone able to handle themselves in a stressful situation? It was one of those things that was not about technology, but about making an executive decisions.”

For Ask Jeeves’ Sampson, the stress caused by WorldCom’s bankruptcy is building, but he says the redundancy of his networks is affording a measure of confidence. “Fortunately, we’ve been able to distribute our network geographically and across different carriers,” he says. “We’ve kept our services with different vendors and we’ve made so many contingencies in our contract that if there is any breach in service, we can walk.”

Source: www.infoworld.com