IT directors should call in their corporate lawyers now for a
line-by-line analysis of their telecoms contracts.
That is the latest advice from analyst firm Giga Information Group
in the aftermath of the crisis that has brought WorldCom to its
knees and seen KPNQwest file for bankruptcy.
In an advisory note, Giga analyst Lisa Pierce warned users not to
expect troubled carriers to give them reasonable notice in which to
migrate to other services or providers. "Enterprise network
contingency planning is essential," she said.
Pierce suggested that large users should split their traffic
between several tier-one providers. Smaller customers should chose
a secure tier-one provider with critical applications and routes
backed up by a second tier provider.
Her view was backed by Steve Andrews, president for BT Ignite's
carrier networks business, which has dealt with many users seeking
alternative suppliers to the bankrupt KPNQwest network.
"It is too expensive for customers to run a full duplicate
network," in the event of a telco provider's service being
suspended, he said. Many users, he noted, ran diversely routed
networks with a backup network from a second provider.
In uncertain times Giga advised users to keep networks and telecoms
contracts short. "We prefer a commitment of a year or less," Pierce
noted. "In such instances, on highly competitive services, clients
may find they can negotiate good prices without making any
longer-term commitments at present."
Meanwhile corporate lawyers should be examining contracts to beef
up clauses allowing early termination in the event of poor
performance or financial problems.