[Outages] Internet failure hits two continents

[Michael.Washington at fitchratings.com]

DUBAI, United Arab Emirates (CNN) -- Large swathes of Asia, the Middle East
and north Africa had their high-technology services crippled Thursday
following a widespread Internet failure which brought many businesses to a
standstill and left others struggling to cope.

One major telecommunications provider blamed the outage, which started
Wednesday, on a major undersea cable failure in the Mediterranean.
India's Internet bandwidth has been sliced in half, The Associated Press
reported, leaving its lucrative outsourcing industry trying to reroute
traffic to satellites and other cables through Asia.

Reports say that Egypt, Pakistan, Saudi Arabia, Qatar, the United Arab
Emirates, Kuwait and Bahrain are also experiencing severe problems.
Nations that have been spared the chaos include Israel -- whose traffic
uses a different route -- and Lebanon and Iraq. Many Middle East
governments have backup satellite systems in case of cable failure.

There were contradictory reports on the real cause behind the disruption,
but Du, a state-owned Dubai telecom provider, attributed it to an undersea
cable cut between Alexandria, Egypt and Palermo, Italy.

An official at Egypt's Ministry of Communications and Information
Technology, speaking on condition of anonymity, said it was believed that a
boat's anchor may have caused the problems, although this was unconfirmed,
AP reported. He added that it might take up to a week to repair the fault.
Kuwait's Ministry of Communications said the problem could take two weeks
to solve, according to a statement carried by the state news agency, KUNA.
There were concerns in India that an Internet slowdown could affect trading
patterns at the country's two major exchanges, the National Stock Exchange
(NSE) in Delhi and the SENSEX exchange in Bombay.

Rajesh Chharia, president of India's Internet Service Providers'
Association, explained that some firms were trying to reroute via Pacific
cables and that companies serving the eastern US and the UK were worst
affected, AP added.

Besides the Internet, the outage caused major disruption to television and
phone services, creating chaos for the UAE's public and private sectors.
The Du internal memo, obtained by CNN, called the situation in Dubai
"critical" and stated that the cable's operators did not know when services
would be restored.

"This will have a major impact on our voice and Internet service for all
the customers," the memo stated. "The network operation team are working
with our suppliers overseas to resolve this as soon as possible."

The outage led to a rapid collapse of a wide range of public services in a
country which proudly promotes itself as technological pioneer.
Sources from Emirates Airlines confirmed to CNN Arabic that the outage did
not affect its flight schedules -- a statement which assured hundreds of
travelers worried after rumors about the possibility of rescheduled flights
due to the faults.

However, Dnata, a government group in charge of providing air travel
services in the Middle East and ground handling services at Dubai
International Airport, acknowledged facing problems because of the outage,
sources from its technical department confirmed to CNN Arabic.

The outage heavily crippled Dubai's business section, which is heavily
reliant on electronic means for billions of dollars' worth of transactions
daily.

Wadah Tahah, the business strategies and development manager for
state-owned construction company EMAAR, told CNN Arabic that it was
fortunate the outage started Wednesday, when there had been only moderate
activity in the UAE markets. He said that softened the blow to business
interests.

But Tahah warned that if the outage continued, "such a situation could
create problems between brokers, companies, and investors due to loss of
control."


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