Ebone network shutdown strands customers

The Ebone network began to shut down on Tuesday, as a final buyout bid was rejected. Efforts to sell other parts of KPNQwest's network continue

As many as 4,500 companies faced the loss of their Internet connections as Ebone, part of the bankrupt KPNQwest network, finally began to shut down on Tuesday. A rescue bid was rejected by administrators in Belgium, and parts of the KPNQwest network are expected to be sold within days. "Ebone was the first backbone of Europe," said Graham Kinsey, staff convenor at the Ebone network centre in Belgium. "I am disgusted." The network still had about 50 percent of a total customer base that was quoted at 45,000 at the time Ebone was purchased by KPNQwest, Kinsey said. "Around 20 percent of the remaining customers had no alternative provider arranged," he went on. "Smaller customers will be hurt the most." "It is one big mess," said Kinsey. "But we are trying to shut down in a controlled way. There is no question of sabotage, but it will not be easy to start up again. If someone has a hidden agenda, they should not expect to bring it back up." Ebone operators took a decision to pull the plug because the temporary arrangement to pay them came to an end on Monday, and the bid for Ebone by Oakley Capital of the UK, rumoured to be 25m euros up-front, was rejected by Belgian administrators on the same day. "The banks have cut their throats," said Kinsey, pointing out that one major bank involved in the process stood to lose major links that were carried by the Ebone network. "They will reel when they realise how stupid they have been." According to sources, the Oakley bidders went to a meeting expecting to seal a deal, but were told to raise the price by 20m euros. However, other sources close to the sales process denied that the banks were responsible. The bid was rejected by administrators, who have a legal responsibility to raise as much cash as possible from the KPNQwest assets. "Several bidders want a part of Ebone, including the network operations centre, and don't care if the network is alive or dead," said a source. "The Belgian administrator is obliged by law to get the best price." Deals could begin to be signed in the next couple of days, with the separate sale of KPNQwest's Central European operation coming first. Other parts of KPNQwest will be sold, with the transatlantic ring likely to attract bids. The Ebone staff are not optimistic about finding jobs. "One thousand people have been fired from Ebone, but 17,000 are going from WorldCom. There are not many ISPs taking people on," said Kinsey.

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