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WorldCom Service Unlikely to Be Interrupted

Aired July 22, 2002 - 14:08   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
KYRA PHILLIPS, CNN ANCHOR: Even if you never heard of WorldCom before last month, though, you may as well use WorldCom's products and services every day.

CNN's Valerie Morris looks now at the company's vast reach and prospects for recovery. How big is WorldCom, Valerie?

VALERIE MORRIS, CNN CORRESPONDENT: The figures are daunting, Kyra. While WorldCom's bankruptcy is making headlines around the world, this really shouldn't surprise anyone. It was just about inevitable that Chapter 11 was the way that WorldCom president John Sidgmore was going to have to go. Specialists have been saying as much for weeks.

If you take a look at the numbers, where there's a telephone line, there is likely WorldCom/MCI. According to the FCC, 30 percent of all placed calls, 70 percent of Internet calls, and 50 percent of business communications go through WorldCom or MCI. In many ways, nothing has changed for all those WorldCom consumers.

At worst, the bankruptcy could cause WorldCom to sell assets. That could mean you eventually have to change your phone carrier, but that won't happen soon either. WorldCom's president John Sidgmore has said that the core assets of the company, like MCI, will stay with the larger group, and that's what he is fighting for as he reorganizes the company.

Don't worry either about suddenly picking up the phone and finding the line dead. The FCC requires telecoms to give customers 30 days' notice before discontinuing service.

Consumers could find a little bit of solace in a story that we have spoken about before. It is RhythmNet Connections (ph). That story was that last September, this Colorado-based DSL operator filed for Chapter 11 status, just like WorldCom, and tried to end its service in less than the prescribed 30 days. The FCC forced them to keep operating.

By law, those telecommunications companies are required to apply to the FCC for permission to shut down, and are not allowed to pull their own plug until after that happens -- Kyra.

PHILLIPS: All right, Valerie. So what do consumers do besides not panic. MORRIS: That's the most important thing. They shouldn't panic because, again, because of that 30-day window that the FCC says must happen. Additionally, there are other carriers who are going to jump in to the breech, and are probably going to be offering some pretty enticing incentives for a former WorldCom customer to become theirs. The only place that you might find some problems if you are a WorldCom/MCI customer is likely to be in customer service, for example, because there have been 11,000 layoffs, and even though the president of the company is saying he doesn't anticipate any future layoffs, customer service and getting help might be where you would see a slowdown.

PHILLIPS: Valerie Morris, thank you.

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