Ebone Network Faces Shutdown

KPNQwest Wednesday starting shutting down its 10,000-kilometer Ebone network after a
buyer wasn’t found, according to reports.

While not all of bankrupt KPNQwest customers were affected, the partial
shutdown threatens to slow European Internet connections, as Ebone traffic
is re-routed.

Netherlands-based KPNQwest, a joint venture between KPN and Qwest
Communications formed in 1998, provides Internet connections to more than
100,000 businesses in Europe with a 25,000-kilometer network. In May,
suffering under a crushing debt load from over-expansion during the halcyon
days for telecom, was declared bankrupt in May, when its creditors and
shareholders declined to bail the company out of its debt obligations.

A consortium of European telecom companies runs KPNQwest’s network while a
permanent buyer is sought for various parts of the network.

In June, AT&T yanked
its bid for KPNQwest, citing insufficient time for due diligence.
Bidders are vying for various bits of the KPNQwest network, including Ebone,
which serves major European cities.

Compounding the problem of KPNQwest’s uncertain future, WorldCom’s recent
woes have raised fears
about the fate of the other big Internet backbone provider in Europe,
UUNet.

“We’re particularly concerned with UUNet subsidiaries overseas with demise
of KPNQwest,” said Giga Information Group analyst Lisa Pierce.