WORLDCOM COMPETITORS READY TO INHERIT GLOBAL DATA MARKET

WorldCom CEO John Sidgmore's assertion last week that the U.S. has a vested interest in keeping the company afloat because it handles so much Internet traffic sounded to some analysts like a veiled threat to a country undeniably hooked on the Web. However, neither the U.S. nor WorldCom has a monopoly on the Internet, and plenty of carriers across the pond are capable of handling all that traffic.

Carriers such as BT Ignite, Cable & Wireless, Equant and Telia, some of which have already seen an increase in business from the collapse of KPNQwest, are positioned across Europe to take advantage of the situation.

“What is happening to WorldCom is not good news for business in general, and confidence for investors has become a big issue,” said Daniel Caclin, chief operating officer at Equant. “But at the same time, there is still strong demand for worldwide data solutions.”

Equant completed the integration of Global One last month, two months ahead of schedule. That puts it in an even better position to attract WorldCom's skittish customers, according to analysts.

Caclin, who was CEO at Global One before its merger with Equant, said that while there is never a good time for industry scandal, “in terms of timing, yes, it is good for us.”

The timing is not so good for European enterprise customers that fled KPNQwest, only to land in the lap of WorldCom. “Now business customers have another player they have to steer clear of — one they can't deal with anymore and the other they would be brave to go with,” said Julian Hewett, chief analyst at Ovum.

The double hit has forced business customers to start asking new questions. “Customers are now asking us if the fiber on [long-haul routes] is really ours, if it is our right of way. They never asked that before,” said Thomas Zedendahl, business information director at Telia.

Because most foreign carriers use some of WorldCom's facilities to connect with the U.S., the company's rumored bankruptcy has sent them scrambling for diversity to ease the concerns of their customers.

Carriers also are beginning to rethink their own strategies. “For years the U.S. has been held up as the best way to run a competitive capitalist economy,” Hewett said. “I think there are some aspects of that that are being questioned by Europeans now.”