RealTime IT News

WorldCom, EarthLink Ink 5-Year Extension

Under a new five-year contract extension, WorldCom will continue to provide wholesale dial-up Internet access to EarthLink .

WorldCom will also provide EarthLink with dedicated Internet, digital subscriber line , and data services through its Internet Protocol network.

"With the strength and stability of (WorldCom's) dial-up network infrastructure, our customers will continue to receive the highest quality network connectivity and performance," said Steven Dean, an EarthLink vice president.

Financial details were not disclosed, but longterm contracts with large Internet service providers are essential if the the Clinton, Miss., telecom hopes to recover from a year marred by allegations of accounting fraud.

EarthLink certainly qualifies. The Atlanta firm serves offers Internet service -- mostly dial-up but also broadband -- in hundreds of cities in the United States and abroad. It also offers Web hosting and other business services.

WorldCom is in the midst of a 100-day reorganization. The plan, laid out by new Chairman and CEO Michael Capellas in late January, includes focusing on profitable business segments including small and medium-sized businesses, reducing structural costs and overhauling management.

Earlier this week, the company rolled out enhancements to Neighborhood and relaunch Connection, Capellas said, followed by completion of its core cost reduction activities by March 31. It will file its plan of reorganization on April 15.

Capellas, a former executive at Compaq and later Hewlett-Packard, also committed to advancing WorldCom's presence in the public sector.

Though it lost out on a whopping $1.7 billion FAA contract, WorldCom has landed a 10-year, $360 million deal to provide IP and ATM services to the U.S. State Department.

WorldCom competes against Level 3 Communications, among others in the wholesale access business. Late last year, Level 3 boosted its wholesale dial-up operations with the acquisition of Genuity.