A local ASP was locked out of Asia Online's offices this morning after trying to retrieve equipment that was being hosted by the now-defunct ISP.
Cavillon Systems co-located around $300,000 worth of equipment for its wholesale ASP business with Asia Online over the past year. Since the demise of Asia Online however, Cavillon has been negotiating new commercial terms with Nexon, which acquired the corporate clients and Sydney and Melbourne infrastructure assets of Asia Online from the receiver, KPMG.
When those negotiations failed, Cavillon decided that it would move its equipment to another data centre, according to Kent Duston, CEO of Cavillon. However, when executives went to the Asia Online offices in Sydney this morning, they were met with resistance.
"Basically what it's done is get the security guards and tossed us out of the building and said that unless we pay an exorbitant amount of money for the month's worth of hosting, it is holding the gear," he said.
A spokesperson for KPMG, which is acting as receiver for Asia Online, said there were a number of reasons why Cavillon would have been unable to obtain its equipment, but mostly due to the need for it to be signed off by both Nexon and KPMG.
"We're not going to let the equipment walk out the door and Nexon understands that it's not to let things walk out the door without our signoff," the spokesperson said. "[Cavillon] has probably just jumped the gun a bit trying to go down and get its gear."
According to the KPMG spokesperson, Cavillon has been dealing with Nexon since November 9, 2001, and regardless of whether or not new terms had been decided, Cavillon would still owe Nexon for servicing the equipment since that time. While Duston agrees with this, his complaint is that the original request for payment was "exorbitant", claiming it was around four times the existing monthly rate.
Charlie Assaf, director of Nexon, refutes this claim, saying this was "definitely not" the case.
Both parties have since come to an agreement on the matter, with Cavillon agreeing to pay a rate less than the initial payment request. However, Duston claims that this is still in excess of the regular fee.
"We've agreed on a settlement figure with [Nexon] which is about twice the market rate and the only reason we've had to do that is, of course, because we have customers to service," he said.
Assaf again disagrees with this, saying that Cavillon has instead got a "good deal".
"It's a lot less than what [Cavillon] was originally paying with Asia Online and that was an exaggerated figure," he said.
Assaf said that the payment request was based upon Cavillon's existing contractual arrangement with Asia Online, but would not expand upon that.
Meanwhile, Duston believes the price ramp up has been a compensatory measure from a mass exodus of clients. "The company's server room was looking pretty empty compared to what it was, so obviously companies are pulling gear out," he said.
Assaf refuted this claim. "Actually, we've been quite surprised. We've had a really good response and most of our clients have stayed on."