AltaVista U.K. Lets Mitchell's Head Roll

In the wake of AltaVista Co.'s public embarrassment over its failed U.K. flat-rate, unmetered Internet access service, the managing director of AltaVista U.K., Andy Mitchell, has gone out the door, the company announced on Wednesday.

Mitchell turned in his resignation to AltaVista, which quickly named Stephanie Himoff as acting managing director of AltaVista U.K., the company said in a statement.

"The mistakes in our planned Internet access service -- which we do acknowledge -- probably made Andy's departure inevitable, and we support his decision," said Pierre Paperon, president of AltaVista Europe, in the statement.

The U.K. division of AltaVista will now focus on its core business, Internet search, according to the statement.

Paperon did not disclose AltaVista's future plans for the ill-fated unmetered Internet access service, which met its downfall on Aug. 21.

Until mid-August, AltaVista had claimed it had launched its unmetered Internet service on June 30 and was connecting some 90,000 U.K. customers per month. The company's public insistence that actual customers had used the service, coupled with its refusal to provide customer testimonials, prompted a nationwide media manhunt for AltaVista users.

Then on Aug. 21, AltaVista admitted that the service wasn't actually in operation.

"Where I've been remiss is in not communicating with our customers," Mitchell said at the time. "I've made all the decisions at the right time, but I should have communicated to our customer base earlier on about the condition of the service. Ninety percent of the complaints we've had have been on lack of communication."

Mitchell blamed British Telecommunications PLC (BT) for failing to offer ISPs (Internet service providers) competitive wholesale access to the telephone local loop. [See "AltaVista U.K.: No Unmetered Access," Aug. 21.]BT's director of regulatory affairs, Ian Morfett, in a statement released by BT on Aug. 22, accused AltaVista of "standing reality on its head as it tries to wriggle away from the consequences of its ill-considered marketing hype."

Morfett strongly denied AltaVista's allegations, stating, "Back in February, the U.K. Internet world was buzzing with innovative unmetered offers from BT, NTL, Telewest and AltaVista. Even the Prime Minister welcomed announcements from all four. BT has delivered working unmetered access for BT Internet and other leading ISPs. The cable companies have delivered offers restricted to their own ISPs. AltaVista has delivered nothing."

In turn, other ISPs, including AOL U.K., a division of AOL Europe GmbH, were quick to condemn BT, saying that AltaVista had dug its own grave.

"There is a danger that all of this confusion, caused in part by AltaVista's crass behavior, will cause the U.K. consumer to turn away from using the Internet. But we do not blame AltaVista for hanging on to something that BT should have long ago supplied to U.K. consumers," said Matt Peacock, director of corporate communications at AOL Europe.

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