Broadband ISP Tiscali UK has threatened a broadband comparison site with legal action after it issued a press release remarking upon the provider’s current financial predicament and directly urging consumers to switch ISP.

The situation follows news earlier this week that Tiscali's auditors, Ernst & Young, had refused to approve the ISPs accounts for 2008 because of "fundamental uncertainties" with the business. Naturally this has cast serious doubt over Tiscali's future.


Understandably Tiscali UK was not best pleased with the sites press release, calling it "totally irresponsible" in a new statement, which warned that possible legal action could follow.. provided they can find some spare cash of course.


The release they refer to is one in which Tiscali UK took "disagreement with the conclusion drawn by the audit report". Sadly encouraging a mass exodus of customers from Tiscali, which they're quite capable of doing all by themselves, is only going to make the situation worse.. though customer concern is growing.

Never the less this doesn't change the fact that Tiscali's future may now rest on whether or not they can renegotiate their £450m debt repayment with the banks before June. There is still the possibility of a sale to consider, although this alone would no longer raise enough to plug the debt pile (rumours suggest that BSkyB's failed bid offered around £250/350m).

It is possible that Tiscali might end up in administration, at which point their broadband customer base would end up being sold off, probably for even less than they would have hoped for. We would hope that they can find a solution before then. But make no mistake, nobody buying Tiscali would want to see a big loss of customers and seek instead to maintain the service during any transition.

UPDATE - 17th April 2009 @ 08:28am :

The comparison site concerned has now issued an apology to Tiscali for its remarks, although many still feel that what they said was only reflecting the thoughts of their customers:


Meanwhile Tiscali itself has again reiterated that there "will be no impact on [OUR] broadband services and support of services will continue as usual." We should know how well that statement has held up by the autumn.