LONDON (08/21/2000) - After weeks of silence, and furious hounding by the U.K. press, AltaVista Co. admitted Monday that its unmetered access product was dead in the water.
The company said Monday that its flat-rate Internet access deal, which prompted a storm of price cutting by British Internet access providers when it was announced earlier this year, was "being put on hold." AltaVista U.K. CEO Andy Mitchell blamed British Telecom, saying BT hadn't offered a competitive enough wholesale package to ISPs.
Mitchell said in an interview Monday that despite claims by AltaVista's representatives that the company would be servicing some 90,000 customers by the end of July, the service was never rolled out to a single customer.
The move comes less than two months after the product was allegedly launched on June 30. AltaVista had pledged to roll out the flat rate access to 250,000 customers across Britain, connecting some 90,000 customer per month.
Mysteriously, although AltaVista said that actual customers had used the service, they refused to provide customer testimonials, prompting a nationwide manhunt on the part of several media outlets for any AltaVista users. As recently as last week, customers who attempted to register for the AltaVista service were told that to avoid congestion problems on the nonexistent service, customers were being held in a queue, and given an Internet account in a "managed" rollout.
"Where I've been remiss is in not communicating with our customers," Mitchell said. "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."The company was maintaining a code of silence until Monday, with representative telling any inquiring journalists that only Mitchell could comment. Mitchell was out of the country for the last three weeks, returning to the office Monday. During that time, he did not respond to journalists' queries via e-mail or phone, prompting criticism in the media for his reticence. Four national newspapers, a host of consumer magazines, and several British Web sites said that Altavista's Internet package was a fabrication. His public-relations agency expressed frustration at the incommunicado Mitchell, and an executive with the European arm of CMGI, AltaVista's parent company, declined to comment on the matter, saying only that doubts about Mitchell's responsiveness were "good questions."Mitchell said he decided three weeks ago to terminate the product, but despite the public outcry, didn't announce the news until Monday.
Industry leaders in London expressed disbelief at Mitchell's continued silence.
"Senior executives need to be reachable, period," said Gehan Telwatte, European managing director for Hoovers Online. "No matter whether it is the old economy or the new economy, we live in an age where we expect accountability of a company's leadership; part of that accountability is being available when your company is in trouble. In the new economy, particularly for companies pushing connectivity products, it is unfortunate if a senior executive is not themselves connected."AltaVista's is only the latest in a string of canceled flat-rate access plans.
Several other products from cable company NTL, ISP Lineone, and Virgin Net have been canceled or put in hold in recent weeks.