Fledgling telco Qala has gone into voluntary administration due to cash flow issues.
According to a Computerworld source, 28 employees from the Sydney office of the ailing next-generation service provider were laid off on Tuesday.
Ernst &Young was appointed as administrator on August 28, according to a spokesperson.
However, the company was unable to confirm how many customers will be affected in the move to administration, or if the "cash flow issues" have spread to the Singapore and Hong Kong offices of the company.
The spokesperson said Ernst & Young will manage Qala until a purchaser is found for the business.
Established by leading technology and venture capital firms, including Walden International, Creative Technology, and Vertex Management, Qala obtained its Australian telecommunications carrier licences in December last year.
The telco was building its own regional telecommunications network using next-generation technologies in areas where it was unable to cost-effectively lease network elements from local operators.
Earlier this year in Australia, 20 selected enterprise users from a cross section of industries tested Qala's broadband Internet access using ADSL technology.
No further details were available prior to publication and Computerworld is waiting for further details from Ernst & Young.