KPNQwest network remains up while customers leave

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• KPNQwest,
• KPN,
• AT&T,
• Qwest

Peter Judge ZDNet.co.uk

Published: 31 May 2002 17:59 BST

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After a nail-biting day, KPNQwest has arranged to keep its network live, although the holding company is officially bankrupt and virtually all its subsidiaries, including the UK, have filed for bankruptcy protection.

"We have a team working to keep the network live while we find migration paths for our users to new providers," said company spokesman Piers Schreiber. This effectively acknowledges that no buyer is expected to take on the company, as every customer that is "helped" in this way represents less value for any owner of the company.

"The banks have pushed us into bankruptcy, the shareholders have stepped away. The staff are doing their best for the customers," said Schreiber. "We would not be doing our duty as a service provider otherwise."

KPNQwest's WAN customers include Dell, HP and Nokia, while IBM uses its services for IP transit. Who gets each KPNQwest customer will depend on individual needs, said Schreiber: "there are not many pan-European service providers left, and few on a national scale."

Schreiber blames the impatience of the banks: "We have 100 million euros in cash. The banks took the decision to freeze this, although it could have funded the orderly sale of the business."

There are one or two bright spots. Despite the bankruptcy of the holding company, KPNQwest is still finalising the sale of its Central European business as a going concern, and its subsidiaries in Italy and Portugal will continue as solvent businesses.

KPNQwest staff in the UK will still have jobs on Wednesday, he said, although their long term future remains uncertain.

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