This was posted on the SI's NN thread.
Regards,
Rick
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CBOT'S LETTER TO MCI WORLDCOM RELATING TO PROJECT A TRADING
cbot.com
The following is a reformatted version of the full text of a letter from CBOT Chairman and CEO Thomas R. Donovan to MCI WorldCom CEO Bernard Ebbers relating to the ongoing MCI WorldCom problems and their effect on Project A trading.) Following is the full text of a letter from CBOT Chairman and CEO Thomas R. Donovan to MCI WorldCom CEO Bernard Ebbers relating to the ongoing MCI WorldCom problems and their effect on Project A trading.
August 13, 1999
Mr. Bernard J. Ebbers
Chief Executive Officer
MCI WorldCom
500 Clinton Center Drive
Clinton, MO 39056
Dear Mr. Ebbers:
Due to MCI WorldCom's recurring inability to provide dependable, stable network services, the Chicago Board of Trade has been forced, yet again, to suspend trading today on our electronic trading platform, Project A®. This follows on the heels of repeated Project A trading halts during the past week as a direct result of MCI WorldCom's catastrophic service disruptions which have deprived large segments of our market users of access to Project A through their trading terminals on the system's wide area network. All told, our Project A markets have been down over 60% of the time since Project A's scheduled Thursday evening trading session last week, exposing our members and their customers to market risk and depriving them of significant trading and revenue opportunities. The CBOT has also experienced a sizable loss of transaction fee revenues.
The CBOT is the world's preeminent futures exchange, with a hard-earned and well-deserved reputation for providing highly reliable, efficient and liquid markets virtually around the clock, both electronically and via open outcry. MCI WorldCom's repeated inability to meet our standards for performance has tarnished the CBOT's 151-year reputation as a provider of dependable and reliable market facilities.
The Project A trading outages are of grave concern not only to our market users, but also to our federal regulator, the Commodity Futures Trading Commission, and to the Department of Treasury. We have been in constant communication with the CFTC over the past week to keep them apprised of the problem and the status of MCI WorldCom's efforts to restore stabilized network service. The CFTC, in turn, has been in communication with the Department of Treasury to address its concerns with the implications of the chronic Project A market disruptions to the CBOT's Treasury futures and options complex, which we offer on Project A as well as by open outcry.
As a result of MCI WorldCom's hollow assurances that it has corrected the problem, we were led to believe it would not be necessary to implement a back-up contingency plan that we have developed. In light of MCI WorldCom's persistent failure to determine and correct the problem, we are forced to implement that contingency plan beginning with the Project A trading session that begins 6:00 p.m. (Chicago time) on Sunday, August 15. Under this contingency plan, many of our members will have to move or duplicate their Project A operations and staffing to back-up locations within the CBOT building, with the costs that will entail and at great inconvenience and disruption to their normal business operations.
This recurring MCI WorldCom failure is unacceptable. CBOT members and market users demand and deserve world-class technology and service, and we are receiving neither from MCI WorldCom. Market users worldwide depend on Project A around the clock, and MCI WorldCom has let them down for one full week. As a result of MCI WorldCom's failure to deliver on their promises to me early last week, the CBOT is pursuing all available remedies. We have lost all confidence in MCI WorldCom's ability to provide reliable service. We await your immediate response as to the measures you intend to take to restore that confidence.
Very truly yours,
Thomas R. Donovan |
