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Bankruptcy Court Approves Acquisition of USA Datanet's Hosted VoIP by WVTC

TMCnews Featured Article

March 13, 2009

Bankruptcy Court Approves Acquisition of USA Datanet's Hosted VoIP by WVTC

By Michael Dinan, TMCnet Editor

A U.S. bankruptcy court reportedly has approved a bid from a communications provider in New England to acquire the hosted VoIP assets of USA Datanet.

Duane Albro, president and chief executive officer of the Warwick Valley Telephone Company – serving parts of New York, New Jersey and Pennsylvania – says that a court in New York’s Northern District approved his company’s modified bid for the business telecom services provider's services.
Based in Syracuse, New York, USA Datanet uses a VoIP network to provide voice, Internet access and enhanced communications services to hundreds of thousands of consumer, business and carrier customers in the United States.
The company’s vice president of sales and marketing, William J. Doolittle, could not immediately be reached for comment by TMCnet.
According to a story in the The Post-Standard, Syracuse’s newspaper of record, USA Datanet filed for bankruptcy in October, citing revenue loss.
“The company disclosed few details about its bankruptcy filing, in which it lists assets of less than $50,000 and liabilities of between $1 million and $10 million,” Tim Knauss reported. “Company officials said only that they filed for protection from creditors after a ‘related business partner’ stopped making payments.”
“Chapter 11 became necessary as a result of the immediate and significant loss of the majority of its wholesale revenue stream when a related business partner stopped making regular, contractually obligated payments to the company a few weeks ago,” the company reportedly said at the time.
Now could be a good time for providers such as WVTC to pick up market share in VoIP services.
Worldwide, one Redwood City, California-based networking and telecom market research firm is reporting this week, the carrier VoIP market fell 20 percent in the fourth quarter of 2008 compared to the prior year.
According to Dell’Oro Group, lower sales in developing regions contributed to the sharp decline, though it isn’t clear yet how much demand in the United States is waning.
Greg Collins, the firm’s vice president, says that developing areas had been a key growth driver for the carrier IP telephony market, as new construction and rising incomes fueled investments in fixed-line telephony services.
“While we saw a market decline coming from developing regions in the fourth quarter of 2008, it is unclear exactly to what extent the decline in consumer demand in the United States will affect the future economies of developing regions, which have relied largely on exports to the United States for their growth,” Collins said.
According to Michael Levensohn of The Times Herald-Record, part of the Hudson Valley Media Group, Albro said of the deal that ‘USA Datanet has customers that are contiguous to our (WVTC's) current base of business customers and we use the same technology platform to serve our customers.”

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Michael Dinan is a contributing editor for TMCnet, covering news in the IP communications, call center and customer relationship management industries. To read more of Michael's articles, please visit his columnist page.

Edited by Michael Dinan

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