 but its rapid fall continued until it filed Chapter 11 bankruptcy in 2002, after its fraudulent accounting had been exposed. The specific sin that brought WorldCom down was that it inflated earnings by booking expenses-in particular, access payments to local exchange carriers-as capital, therefore improving short-term profit margins. The post- bankruptcy company emerged under new management, renamed MCI. ISP Pricing Creates Permanent Losses With its scale and with WorldCom's bandwidth in-house, UUNET may well have had the lowest cost of operation of the original Tier 1 ISPs. AT&T was a Johnny-come-lately to the business; it started dabbling in the backbone business in 1995 by reselling BBN Planet's service, starting its own the following year. MCI had sold its interest in ANS and was starting to build its own new ISP backbone in 1995, catching up with Sprint. These companies could afford to quickly add bandwidth and lower their prices at the same time. But other ISPs were not SO lucky. BBN Planet, PSInet, AOL's ANS, and other ISPs paid others for their bandwidth. The Internet Boom and the Limits to Growth Their other expenses were high as well. Backbone ISPs had high selling costs. Large retail ISPs such as AOL and Earthlink relied on advertising and, in AOL's case, vast amounts of direct mail. That was costly enough. But the back- bone providers made considerable use of the direct sales model, with salesmen making calls on potential customers. This required an infrastructure of regional sales offices and sales support. And the Internet business was not cut-and-dried. Although managers tried to make it a "repeatable" process, customers' needs were changing as fast as the network was growing. (And even if it was not dou- bling every 100 days, doubling once a year was plenty fast.) The nature of the Internet backbone service itself may have contributed to the ISPs' financial woes. IP packet relaying, the core business of back- bone providers, is usually referred to as a "best effort" service. This is a euphe- mism