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Technology Stocks : Ascend Communications (ASND)
ASND 205.50-1.5%3:59 PM EST

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To: djane who wrote (45120)4/22/1998 1:44:00 PM
From: djane   of 61433
 
Companies Tap Contingency Plans as AT&T's Frame Relay Network Crashes
[Shouldn't this drive more sales of ASND frame relay equipment?]

(04/20/98; 4:33 p.m. ET)
By Kate Gerwig, InternetWeek

techweb.com

Network backup, like life insurance, is something you
buy, but hope you'll never use. Last week, many
AT&T frame relay customers found out what their
backup systems were made of.

"This isn't exactly the way we wanted to find out that
our backup systems are excellent," said a MasterCard
International spokesman after his company recovered
from the nationwide failure of AT&T's InterSpan
frame relay network.

After MasterCard got over the initial shock from a
network failure that stranded 23,000-member financial
institutions around the world, it got some good news.
"Investing lots of money in multiple backup systems was exactly the right thing to do," the MasterCard spokesman said, summing up the 24-hour disaster that
left an estimated 6,600 AT&T frame relay customers
firing traffic into a dead network.

MasterCard relies on AT&T's frame relay network to
process $600 billion in credit card transactions each
year -- or $1.64 billion a day. It is only one of
thousands of business customers that rely on AT&T's
data network for mission-critical applications.

MasterCard was luckier than many others.

Wells Fargo Bank, which uses AT&T frame service in
California to connect 1,070 branches, found that
one-half were without working automated teller
machines, phones, and computer terminals after the
failure. The 500 branches that rely on an
AT&T-provided ISDN backup system continued
working, although slowly. While Wells Fargo worked
with AT&T to bring its network back to life, it also
called in MCI and Roseville Telephone to install 12
T1s to restore service in 350 of its California sites.

Some new AT&T frame relay customers were left
pretty rattled by the experience. A publishing company
that chose AT&T less than a month ago said AT&T
responded to the outage quickly, but there were
problems switching to the AT&T-provided ISDN
backup service.

"The ISDN connections were unavailable almost as
long as the frame network was down," said the
publishing company's network manager, who asked
not to be identified. "We won't move away from frame
right now. We were happy before the crash. But we'll
keep an eye on new technologies that might be more
reliable."

The AT&T crash may lead some businesses to use
different providers for redundant and backup
connections.

"A massive outage like this is highly unusual, but it has
bitten a lot of people," said Chris Luise, chief technical
officer of Skandia AFS, a worldwide insurance and
financial services company, and an MCI user.
"Anyone who has a mission-critical network that is
running without a backup is flying without a net."

Those safeguards may appear outdated with today's
self-healing backbones and Sonet rings. "It's just not a
strategy that people subscribe to anymore. It's put all
your eggs into one basket and get the lowest price you
can," Luise said.

The mysterious 24-hour crash will go down in the
record books as one of the biggest and longest.

Michael Armstrong, AT&T's CEO, publicly
apologized and dispatched service reps to work at
customer sites night and day. He also sent
hand-delivered letters to the CEOs of all of AT&T's
frame customers the morning after the failure.
Customers with heavy network dependence were
given 15-minute updates on network status,
Armstrong said.

"It's been a very difficult 20 hours for our customers,"
Armstrong said last Tuesday. "We let our customers
down, and I want to apologize to each and every one
of them. We will apply every resource we can to fix
this problem."

Frank Ianna, AT&T executive vice president of
network and computing services, said the problem
started with two of the 145 StrataCom BPX 8600
switches in the AT&T frame network. StrataCom is
now owned by Cisco.

AT&T confirmed that the problem switches are in
Cambridge, Mass., and Albany, N.Y.

"The problem was probably from some type of
hardware, software, or a combination of the two,"
Ianna said. "It began to spread through the network
and impact virtually every node on the network."

Ianna admitted that StrataView, the BPX network
management system used by AT&T, did not alert
operations personnel to the problem.

"This is the first time [the InterSpan network has] ever
gone down," said Rick Malone, a principal at Vertical
Systems. "Certain industries live and die on these
networks. They have airline networks that have
thousands of sites. If all of these sites are down, it's
panic time."

No matter what the cause, Malone gives AT&T high
marks for bringing 100,000 ports back up in 24 hours.
"This is the service provider's total nightmare -- a
network that shuts down by itself. This was a fatal
problem, and they brought it back up."

AT&T has such faith in its frame relay network that
only in January did it begin offering new service-level
agreements (SLA) that guarantee 99.99 percent
network availability. Customers who signed on since
January receive credits commensurate with their
network size if the network goes down. If a
customer's permanent virtual circuits are lost and are
not restored within four hours, they get the affected
ports and PVCs free for a month.

Many frame relay customers are not covered by the
new SLAs, however, and have negotiated individual
SLAs with AT&T. Regardless of the SLA in effect,
Armstrong said, the company will not charge
customers for frame relay service until it fixes the
problem and can provide better guarantees that it will
not happen again.

"Frankly, AT&T has one of the best SLAs in the
industry right now," said TeleChoice analyst Christine
Heckart.

"The cause of the problem will probably be resolved
by the end of the month, but there's no way to
guarantee that. For Armstrong to say they weren't
going to charge customers until it is resolved is not
necessarily low risk," she said.

Heckart said AT&T's handling of the outage sets a
new benchmark in the industry for crisis management
and has customers giving AT&T high marks for
responsiveness.

"Every customer knows they will work with a carrier
that will have problems. So what they have to look
for, is how the carrier responds during the problem,"
she said.
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