Auditor Ernst & Young has revealed that mounting debts have left Tiscali close to administration. The Carphone Warehouse has renewed its interest in acquiring the company, but many analysts believe a deal is unlikely to be hammered out and are predicting the collapse of the ISP.

In light of the debts, broadband comparison site Top 10 Broadband issued a press release earlier today urging customers of the ISP to switch providers in case the collapse of Tiscali left them without internet access.

Jessica McArdle, marketing manager at Top 10 Broadband initially said: "People are right to worry about the fortunes of their ISPs in the current climate. We urge concerned consumers to switch to broadband providers who can offer stability".

However,  after the ISP described Top 10 Broadband's comments as "totally irresponsible" and threatened legal action, the broadband comparison site has now backtracked on its original advice.

"We have spoken to Tiscali and agree with them that our press release might have caused unnecessary concern for its customers. We understand from Tiscali that its lending banks are continuing to support the company and any suggestions that customers could be switched off are speculative and unhelpful. We have apologised for this and retracted the release as this was certainly not our intention," said a spokesperson for Top 10 Broadband.

"As one of the UK’s leading broadband providers, Tiscali is a valuable contributor to the information and choices we provide for consumers on our site and we will continue to support Tiscali on Top 10 Broadband."

Jody Haskayne from Tiscali said: "We can assure customers that there will be no impact on their broadband services and support of services will continue as usual. We are confident of the future of our business".