According to reports, prominent analyst group Meta has advised those WorldCom customers among its clients that the problems at WorldCom would inevitably affect service and they should look elsewhere.
‘Users with WorldCom agreements should examine exit clauses and exercise them before Chapter 11 bankruptcy is declared, making it difficult (if not impossible) to vacate existing agreements,’ Meta wrote.
‘Users that do not have exit clauses should immediately examine their contractual commitments and plan to migrate business-critical traffic to other carriers.’
WorldCom recently confessed to a $4bn (£2.6bn) shortfall due to accounting inaccuracies covering, over $1.22bn of losses and deceiving investors.
Despite calls from new WorldCom chief executive John Sidgmore for reform, including the laying off of 17,000 staff globally, Meta is unimpressed.
‘The pending layoff of 28% of the WorldCom workforce and the impact on morale of the financial debacle will weigh heavily on the remaining employees, and WorldCom customers should expect diminished service going forward,’ Meta Group concluded.
Seperately, in the US, WorldCom has been blasted by the Securities and Exchange Commission, which has demanded further information on the financial status of the company.
In a statement, SEC Chairman Harvey Pitt described WorldCom’s efforts to date as ‘wholly inadequate and incomplete,’ adding that ‘[WorldCom] demonstrates a lack of commitment to full disclosure to investors and less than full cooperation with the SEC.’
US tech stock market Nasdaq could delist the company’s stock as early as Friday unless WorldCom appeals.
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