ISP in liquidation after being hit with wind-up order from iiNet subsidiary

An ACT-based internet service provider has been placed in liquidation, after an iiNet subsidiary hit the company with a wind-up order when it failed to pay a $38,900 debt.

The development highlights the ongoing trouble for smaller players in the telecommunications industry, as larger players edge out smaller companies in the race to sign new members ahead of the National Broadband Network.

iiNet was contacted this morning but a reply was not available before publication.

However, chief regulatory officer Steve Dalby told The Australian the company took legal action against Ovee for “failing to meet agreed payment schemes put in place”, and added that “the company was not present or represented” at a hearing.

The application was made through iiNet’s subsidiary TransACT, which it bought in 2010.

Ovee, which traded as Apex Telecom, was placed into liquidation on October 12, with Henry Kazar of Kazar Slaven appointed. Kazar was also contacted this morning, but a reply was unavailable before publication.

Apex claims it is Canberra’s second oldest, locally owned and operated ISP.

The liquidation of the regional ISP is yet another sign the telecommunications industry is undergoing significant change. The major players are bent on gaining scale in order to compete when the NBN is in place.

When the NBN is built, the amount of customers a company has will be a main factor in its market strength, not access to telecommunications infrastructure through which to sell services to other companies.

iiNet in particular has been buying companies. Last year it purchased Internode, and in 2010 it bought TransACT and Netspace.