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How Will WorldCom/UUNet Impact The Internet?
somewinner writes "CNN.com has an article discussing WordCom's impending failure and its possible impact on the internet. Given that WorldCom (via UUNet) handles 50% of US internet traffic, and a large percentage of traffic worldwide, some concern is certainly justifiable. However, the author of the article seems to think that nothing serious is going to happen."
If Worldcom's failure were to bring a heightened sense of overall awareness about why you really DON'T want to put all your eggs in one basket, this may end up being a good thing.
If enough key (read: rich) players and businesses are seriously inconvenienced (read: lose a lot of revenue) because a key point of potential failure actually failed, then certain monopolies that have predatory practices might be trusted a lot less by default, with people seeking out alternatives "just in case".
If UUNet goes away, then were will the spammers turn? Right now they have UUNet which says 'not our problem because the spammer is our customer's customer.' What happens if UUNet is taken over by a reputable ISP that shuts down spammers and those that harbor them?
It would be better to re-nationalize the internet backbone, then to bail out those bastards at Worldcom. It was government controlled when only the military and universities could use the internet. I hope Milnet, formerly Arpanet, the part of it that is still there to keep our defense network up and running in the case of an enemy attack, is not part of what Worldcom could pull the plug on.
The Uncoveror: It's the real news.
this is a map of AS paths & peering relationships on the internet. take a close look at the center.
I despise all of this fearmongering over 'what would we do' if Microsoft, or Worldcom, or Enron, or AOL/TW were to fall. Even if it's justified, who's fault is that? Who let them get so big and unobstructed that they could hold an entire economy hostage? My opinion is that, in a free market system, "You need us," is not a viable solution to a failing business. Whether it's an airline or a telecom, let'em crumble. They all seem eager to be left alone, free to 'innovate' or 'compete' until innovation and competition reveals them to be a failure, and then they're newly born socialists begging for government cheese because they're existence is supposedly good for 'the people'.
Incase it escaped anyone's radar Worldcom owns OzEmail, which according to an IT news website is ranked the No. 2 Australian ISP after Telstra. This most likely means that Worldcom will have to sell off OzEmail to recover some assets for it's creditors, but this is not all bad because it means it's original owners could buy it back for far cheaper than they sold it for. There is some more information at this link and this link.
aus.music.scrapbook
About forty years ago, it looked like Lockheed was going to go bankrupt. The stock fell from $60 to $3, which was below par (i.e. breaking up the company and selling off the assets would have recovered more money than the stock was selling for). The problem was that Lockheed wasn't just a defense contractor, it was the defense contractor, and during the height of the cold war, to boot. They couldn't be allowed to go bankrupt.
So the government bailed them out.
Then, some years later, there was a little problem at a generating plant owned by General Public Utilities (GPU). You might not have heard of GPU but you've heard of the plant: Three Mile Island. GPU stock took a hit, as you might imagine. In fact it looked like it might go broke. The problem was that it was a utility, which means it was a monopoly. If it went broke the lights went out over a fair stretch of countryside. That couldn't happen.
So the government bailed them out.
Now, my father saw both of those coming. He bought Lockheed stock at fire-sale prices because he knew that they couldn't be allowed to go broke. He cried because he couldn't afford more. He made out like a bandit.
When GPU started to go under, he bought all the GPU stock he could. And this time, he could afford more. He made out like a bandit. So well, in fact, that he assured himself a comfortable retirement. He's quite conservative, and told me ruefully, "I always preached the values of thrift and economy. Now I'm comfortable in my old age, but it isn't due to any of that. Hmph."
Then the Seattle public utility, through a boring series of blunders, started to go broke. They couldn't be allowed to go broke, for the same reasons that GPU couldn't and Lockheed couldn't.
So the government...said "Hey! Wait just a darn minute here!" And didn't bail them out.
And they went broke. And the lights stayed on.
Ditto when California started having rolling blackouts. Big raspberries from the Fed, because the Shrub knows California wouldn't vote for him if he was rolling out the red carpet in front of Jesus Christ for the Second Coming. Much stick-waving, stunningly bad contracting, and shouting, but the lights came back on and stayed that way.
The days of government bailouts are over.