RealTime IT News

ConnectSouth Shuts Doors

It seems there's an element of truth to persistent rumors this week of the demise of broadband Internet service provider ConnectSouth.

The Austin, TX-based digital subscriber line provider shut down its Web site Monday morning, to the obvious surprise of many of its customers.

In addition to consumer DSL service, ConnectSouth provided end-to-end business services including collocation, virtual private networking and firewall technology.

Officials released a letter earlier this week stating service would be shut down sometime on or before March 24.

"We regret to inform you that, due to the dramatic downturn in the financial markets, ConnectSouth Communications Inc. will be permanently ceasing operations. This letter is to notify you that ConnectSouth intends to liquidate the business in an orderly fashion.

"Based on information currently available, it is anticipated that the permanent termination of the network and business services currently provided by ConnectSouth will take place on or before March 24, 2001."

Officials said they would help customers transfer service to new service providers before March 2, provided they call to make arrangements. Although a majority of users fall under BellSouth Corp. or SBC Communications a partial list of alternate providers was provided to customers. They include XO Communications and New Edge Networks.

ConnectSouth also shut down operations to its Web hosting and online backup recovery service for businesses. Domain owners have been asked to contact their registrar and switch Web hosting services to another provider. Current customers can visit ConnectSouth's notification page for more information.

High-speed ISPs nationwide have faced many difficulties providing competing DSL service with data competitive local exchange carriers (DLECs) and Baby Bells.

This week, a ruling by the courts made it even harder for troubled ISPs to keep their customers.

Covad Communications Group won a ruling in the U.S. Bankruptcy court that paves the way for the DLEC to take the customers of one of its ISP partners, Flashcom, which has been struggling to pay its bills.

Covad officials announced this week its plans to buy Flashcom's nearly 25,000 subscribers and forgive its debt for an upfront fee of $750,000. Covad could pay up to $2.75 million more, depending on the amount of Flashcom subscribers that switch.

ConnectSouth officials declined numerous requests for information.