MCI WorldCom outage cripples Chicago Board of Trade : LUSENET : TimeBomb 2000 (Y2000) : One Thread

MCI WorldCom outage cripples Chicago Board of Trade

By John Rendleman 08/11/99 12:40:00 PM

* MCI WorldCom frame outage continues

Transmission interruptions on MCI WorldCom's backbone data network are disrupting business for up to a third of the carrier's business customers, company officials said today.

The difficulty began late last week during an upgrade of transmission software, and the outages have been especially troublesome for banks operating automatic teller machines that require data connectivity to operate, as well as financial and commodity trading firms, which also rely heavily on timely data delivery.

At the Chicago Board of Trade, transactions will resume today at 2:15 p.m. on the Board's Project A network, according to officials. Trading was suspended at 9:21 p.m. on August 5.

The interruption prompted an angry letter from Board President Thomas Donovan to board members in which Donovan said, "This latest problem with MCI WorldCom comes despite numerous past assurances from [MCI WorldCom officials] for improved Project A service."

A 'meltdown'

According to Donavan, MCI's own top operations executive in charge of running the network called the outages a total "meltdown of the network."

The outages also followed by two days a meeting with MCI WorldCom in which Donovan "expressed my extreme concern and displeasure with the unsatisfactory quality of service that they have been providing," according to the letter.

The outage cut off all transmission to Board Project A workstations outside of the board's main building, prompting board officials to develop contingency plans for future outages and initiate plans to seek redress from MCI WorldCom, said boa

-- Meltdown (coming@too.soon), August 11, 1999


Ok, so no emails or telexes at work this morning due to MCI. My personal ISP was hosed most of the weekend due to MCI. Spoke to friend at price data distribution company which is dropping MCI due to this problem. Spoke to friend at Anderson Consulting who said that half their projects are currently experiencing major problems due to this problem.

It was a software upgrade. Yeah. Uh huh. And you expect me to believe their will be no Comms problems come Jan! Sorry doesn't pass the sniff test.

And interestingly enough the press couldn't give a shit. Hey there mr. newspaper man, whatcha gonna do when they come for you. Bad boys, bad boys whatcha gonna do when they come for you.

You guys give journalists a bad name. Grow some balls and start reporting this shit.

-- Gordon (, August 11, 1999.

AOL has been terrible in NYC, St. Louis and Syracuse due to this. Other cities, too, but these I know from me and my buddies.

-- Mara Wayne (, August 11, 1999.

Maaaaarrmmmmmmmmmmmmaaaaaaaaaaaa, where are youuuuuuuuuuuuuu????????

Fliiiiiiiiiiiiiiiinnnnttttttt, where are youuuuuuuuuuuuuuuuu??????

-- George (, August 11, 1999.

I posted this on Silicon Investor, and thought it had some relevancy here.

OFF TOPIC: Sort of.

IRIDIUM LLC, which runs the first global satellite-telephone network, is 86 percent-owned by 19 investors, which also include Lockheed Martin Corp., Raytheon Co., Sprint Corp. and American International Group Inc .... [Motorola's involved too.]

How many satellites did they launch this past year that went KABOOM?

I just heard more bad news today on CNBC: 2) DJN 14:21 *DJ Iridium Says Defaulted On $800M, $750M Credit Facilities 3) DJN 14:21 +DJ Iridium: Bank Waiver Of $800M Credit Expired Wed >IRID 4) BN 14:17 *IRIDIUM DEFAULTS UNDER CREDIT FACILITIES :IRID US

I sure wish I took Anthony@Pacific's advice yesterday to short IRID when it was@6.

Ooooooooooooh - look at this chart: rt=line&chart1=ma&i0=1&i1=0&i2=0&i3=0&scale=linear&s=IRID ---------------------------------------------------------------------- -------

This GPS deal on August 21 is becoming more worrisome to me. I sure hope that none of IRID's global satellites up there right now ... have that end-of-week roll-over problem. Can you imagine what it would do to Internet stock prices ... and on-line trading ... and even "off-line" trading ... if we have problems with telecoms?

Could make that MCI outage/disruption pale in comparison, huh?

Sure a lot of telecom and ATM problems these days. Aren't there? Like that one in Toronto that affected over 100,000 - and caused problems from Ottawa to Vancouver. Of course that one was caused by someone dropping a wrench, wasn't it?

And that other ATM problem in the U.S. a couple of weeks ago, that affected ... what was it? 15% of ATM machines nation-wide? Of course, that wasn't MCI. That was someone else.

Like I said. There sure have been a lot of telecom and ATM problems these days ......

-- Cheryl (, August 11, 1999.

Something else I wrote on Silicon Investor, in response to someone who was originally pretty dismissive about the whole MCI & COBT deal ...

<I wonder what effect this disruption has had on commodities pricing??>

Who knows? I'm sure someone knows. It had to have made some impact. They just aren't making it public.

<Is it part of the reason for some of the movement in the CRB and pressure on the T-bills??>

Who knows? Media's pretty much kept a lid on this whole thing so far. I can understand if it was a one day deal. But, from last Thursday thru this Tuesday??? Give me a break.

Transactions were supposed to resume at 2:15PM this afternoon at COBT. Wonder if Wall Street was keeping eye on situation? When did market turn-around and rally today?

Maybe just a coincidence.

<It is interesting, but I guess my point was, no matter how severe the disruption has been, it has not brought entire markets to a halt in such a way that the news media can ignore the cause/effect.>

Really? News media can't ignore this? Hmmm - Guess I don't trust them as much as you do.

<Actually, I'm pretty amazed that there hasn't been more news coverage.>

Me too. Considering CNBC coverage when Ebay's down. When E-trade's down. When Ameritrade's down ...

But MCI's network's down for up to a third of their business customers ... and not a peep.

You'd think it would be a "newsworthy" item ... those outages/disruptions at Chicago Board of Trade ... from Thursday thru most of Tuesday ... wouldn't you?

MCI's price drops Friday, Monday ... and all CNBC can attribute it to is that rate reduction of theirs? Give me a break.

Did you see that CBOT is planning on seeking redress from MCI WorldCom? And other business customers can to, depending on terms of contract.

MCI WORLDCOM MELTDOWN SLAMS TRADERS: Network woes continue as Chicago Board of Trade has been crippled since last Thursday ...,4586,1015926,00.html

I wonder if GPS end-of-week rollover problems August 21 will affect telecoms? It's a real wildcard. We'll find out soon enough, won't we?

142 Days until 2000 P.S. I just heard on CNBC that 90% of hospitals are still waiting for Y2K software upgrades. WHEW - High percentage. Surprised at that CNBC segment. It was about a 5-minute segment focused on Healthcare industry. No more laughing anymore.

-- Cheryl (, August 11, 1999.

close tag

-- close tag (, August 11, 1999.


-- harumph (, August 11, 1999.

Here is a little snip from the Motorola Y2K Disclaimer. When reading the SEC filing the risks to the company are legal and not technical. It is the client that has the risk.

 MOTOROLA INC - (Year 2000 Disclosure) Quarterly Report (SEC

Network Solutions Segment


       The cellular infrastructure business has communicated to customers and company
       customer contacts "work- arounds" for certain systems that will not be upgraded.
       A "work-around" gives the operator necessary procedures to keep the system
       operating on and after January 1, 2000. If a customer does not follow the
       recommended procedures it is likely that the system will not recognize certain
       dates properly, affecting the accuracy of certain data. The business has concluded
       that some of its systems are too old to either upgrade or provide a work-around
       for Year 2000 issues. It has notified customers with outdated systems.
       Additionally, a website provides Year 2000 information on certain discontinued
       products. Some customers of discontinued products have been notified that their
       system will not work and information has been provided on needed upgrades
       and/or replacements. The business has sent out second notices and has asked for
       confirmations back from these customers.

       ***Management believes that its most reasonably likely worst case scenario related to
       the Year 2000 issue is its inability to upgrade all systems before January 1, 2000
       due to the significant number of customer locations to be visited and to delays by
       customers in scheduling upgrades. As a result, system performance could be
       affected and certain data routinely available from those systems could be
       inaccurate on and after January 1, 2000 until upgraded. As a result, the business
       could incur cost, and potentially be sued as the supplier of those systems,
       although its efforts to identify its customers and provide software solutions
       should reduce these risks.< /u>


-- Brian (, August 11, 1999.

Stupid html

-- Brian (, August 11, 1999.

Doomers Creed - "If its a software bug, its GOT to be Y2K, even if it's in 1999." Geesh.

-- (, August 11, 1999.

You never know where some of these conversations lead you, huh? Here's more of my conversation from someone on Silicon Investor:

<IRID ... It's too big to fail... and besides, as I mentioned before, the Iridium system is the US govts backup communications system for Y2K contingency planning.>

U.S. governments backup communications system for Y2K contingency planning? No, I didn't know that.

Hmmm "Too big to fail." Seems I've heard those words before ...

"In later cases, such as the Continental Illinois rescue of 1984 and that of the First Republicbank of Dallas in 1988, the FDIC deliberately removed all limit on guarantees in order to halt imminent runs, establishing the practical rule that some banks with deposits over $100,000 were "too big to fail. When push came to shove, the purpose of deposit insurance proved to be less taking care of the 'little man' with a deposit of under $100,000, than to prevent bank runs that would embarrass the system." Manias, Panics and Crashes - Pg 140

Actually IMHO a far better book that detailed the whole banking and S&L debacle, was a book called "Funny Money". Fascinating and funny. Unfortunately, it's out of print.

Continental Illinois "achilles heal" was Penn Square Bank in Oklahoma. CEO and other officers of Penn Square made all kinds of major commercial real estate deals all over the place. CEO guaranteed many, many loans with his signature ... and nothing to back it up. He did deals with Continental Illinois.

I wish I remembered the guy's name. When I was looking for financing for my marketing research company back in 1986, I flew up with a friend who introduced us. [I didn't realize what was going on then.]

Anyway, we went to lunch. Got drunk. Lasted thru "Happy Hour". Did a bit of dancing.

Then this guy tells me ... " You're sitting here drinking with the man, who has had more personal lawsuits filed against him ... than any other man in the United States! And, I'll probably be getting more. HA HA"

"But, I put everything in my wife's name and a couple of my good friend's names a long time ago. No one's gonna get anything. HA HA"

Say what???

And then he starts to tell me about all of these deals between Penn Square and Continental Illinois. He laughed, drank some more, And then he told me, "All it took was my signature. HA HA"

"And, I was signing guarantees with nothing to back it up. HA HA"

"I was greedy. They were greedy."

"They'd come here wearing those little dark suits of theirs, with dollar signs in their eyes. Looked down at me like I was some cowboy hick. But they wanted what I could give 'em. H*ll, they were as bad as I was."

"Besides, they were too big to fail." [That's where I first heard that phrase.]

Remember, these were the oil & real estate hey days. This banker from Oklahoma, who helped bring Continental Illinois to their knees ... wore cowboy boots to work.

When I got back to Houston and had dinner with some oil guys and mentioned this guys name. They all laughed, and told me to get that book, "Funny Money".

BTW: Penn Square Bank was physically, a teeny-tiny bank in a strip shopping center!

As I see all of these financial mega-mergers going on now, I wonder ... what would/could the FDIC do ... if one or two of these mega-banks were at the brink of failure.

Is there realistically enough money to bail out any of these banks "because they're too big to fail"?

Guess that's why FED got involved with LTCM last year, huh? "They're too big to fail."

Now, we have Iridium LLC... who is also ... "Too big to fail"

Iridium LLC, the cash strapped satellite-telephone company, which defaulted on bank loans totaling more than $1.5 billion after its lenders failed to extend today's deadline for the company to meet conditions.

From Bloomberg

Iridium's banks had granted three extensions, most recently in June, for the company to meet conditions on about $800 million in syndicated bank loans. Iridium also defaulted on a $750 million bank loan guaranteed by Motorola Inc., the biggest investor in the 66-satellite network ...

The default is tied up in the wrangling over a restructuring of Iridium, which doesn't have the money to pay its debts after getting only a fraction of the subscribers it had promised. Iridium's banks, led by Chase Manhattan Corp., are trying to protect their own interests as Iridium negotiates a settlement with both its banks and bondholders

The $800 million loan was arranged by Chase Manhattan and Barclays Plc and syndicated to 23 banks and institutional investors ...


<It's too big to fail... and besides, as I mentioned before, the Iridium system is the US govts backup communications system for Y2K contingency planning.

GHEEZ. It's worse than I thought.

Guess government will be involved with this too.

-- Cheryl (, August 12, 1999.

Doomers Creed - "If its a software bug, its GOT to be Y2K, even if it's in 1999." Geesh.

-- (, August 11, 1999.


-- OR (, August 12, 1999.

Maaarmmmmmmmmmmmaaaaaaaaa, where are youuuuuu????????????????

-- George (, August 12, 1999.

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