March 09, 2004, 9:13 AM — Web hosting company Verio Inc., a subsidiary of NTT Communications Corp., sees new business opportunities arising from the recent troubles of bankrupt Cable and Wireless America Inc. (CWA).
The Englewood, Colorado, company is targeting channel partners that lost commissions when U.K. network operator Cable and Wireless PLC (C&W) withdrew from the U.S. market. Former CWA partners are now being offered a one-time bonus payment for each enterprise hosting or access customer they bring to the Verio Partner Program, Verio said in a statement Monday.
CWA, based in Reston, Virginia, filed for bankruptcy protection in December after C&W claimed its U.S. division was losing $1 million per day. The company was sold to Savvis Communications Corp. in January after an auction process conducted by the U.S. Bankruptcy Court for the District of Delaware.
Seven companies bid on CWA's Web hosting and IP (Internet Protocol) services businesses, but Savvis won the right to buy C&W's domestic assets for US$155 million while also assuming $12.5 million in liabilities.
For that, Savvis received the CWA U.S. backbone network, 15 Web hosting data centers, 1,160 employees and reportedly 5,000 business customers. At the time of the sale, Savvis, based in both St. Louis and Herndon, Virginia, said the acquisition would double its customer base, but companies such as Verio are now fighting for a share of that pie.
The Verio offer is good through May 31, with the bonus payment being worth up to 75 percent of one month's recurring revenue, the company said.
According to Verio, Allyance Communications Networks Inc., in Irvine, California, is one of the former CWA partners that has already made the switch.
Representatives from Verio, Savvis and Allyance Communications could not immediately be reached for comment.