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
for more information.

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

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.

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