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WorldCom users ask, 'What if . . .?'

July 15, 2002 12:00 PM ET

Computerworld - WASHINGTON -- The contingency planning that IT manager Barry Brunetto developed for his company, Blount International Inc., covers a lot of scenarios, including failed circuits and earthquakes. But he never imagined that a company of WorldCom Inc.'s stature could be a disaster, and Brunetto is now looking for a safety net for his data services. He's not alone.

Brunetto, the Portland, Ore.-based director of information systems at the sporting goods and power equipment maker, thought he had a viable business-contingency protection strategy in place: restricting business agreements to "Tier 1" companies—the most reliable ones. That was then.

"One of the reasons we deal with Tier 1 vendors is the stability issue," said Brunetto. "But now it doesn't look like anything is stable."

The WorldCom mess has become a bad dream for many in IT. None of the IT and telecommunications managers interviewed for this article said that they seriously believe that WorldCom's service is going to be switched off because it's too vital. But they also noted that they have no choice but to consider "what if" scenarios.

Gary Rosenberg, telecommunications manager at Nortek Inc., a manufacturer of building products in Providence, R.I., relies on WorldCom for voice and data.

Rosenberg is a 42-year telecom veteran, but WorldCom's problems are prompting him to think in new ways. He's talking with vendors about providing a standby service—having lines in place and ready to go if WorldCom fails.

But having seven T1 backup lines in just one facility could cost $100,000 a month, said Rosenberg. The cost is high because the vendors don't have pricing mechanisms for running lines that aren't also carrying revenue-generating voice and data traffic, he said. Rosenberg counters by telling vendors that providing an affordable standby service could give them a leg up once telecommunications contracts are rebid. Negotiations are continuing, he said.

WorldCom's problems are also a slap in the face to IT managers who review a vendor's financial statements as part of a contracting process. For 15 months, WorldCom allegedly inflated its earnings by nearly $4 billion.

Due Diligence

Due diligence "just goes out the window if audited financial statements are not to be believed," said Andy Fisk, IT manager at the Tribune-Review Publishing Co., a Greensburg, Pa.-based newspaper chain.

Fisk has contacted other carriers to provide backup for his WorldCom services. But like other IT managers, he doesn't want to change providers "on the off chance they [WorldCom] are going to go away," he said. But, Fisk added, "on the other hand, I'd hate to find out that they've gone away and left us high and dry."

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