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Date: Tuesday, March 07, 2000, 1:49 PM -0500
From: Faulkner Mail Server <mailserver@faulknerinfo.com>
To: ???
Subject: Faulkner's Comm Flash 03/07/2000 - (Part 2 of 3)

Legal News 
	 BT said it is considering taking legal action to delay the upcoming mobile
license auction. Vodafone AirTouch and Orange both filed to take part in the
auction, but since Orange is being acquired by Vodafone, BT feels one of
them should not be allowed to bid. Even though regulations forbid companies
owned by the same entity to hold more than one license, BT suggests that the
two companies could collude before they part ways. Vodafone AirTouch will
divest Orange to receive regulator approval for its pending acquisition of
Mannesmann.
	 General DataComm reported that its subsidiary General DataComm Ltd sued
	 ADC Telecommunications to enjoin the use by ADC of GDC, Ltd's technology.
Pathway, a subsidiary of ADC, had entered into a consulting agreement with
GDC, Ltd for the development of video codec module products. Under the
agreement, all products and intellectual property developed would be owned
by GDC, Ltd. In breech of these agreements, Pathway, and other defendants,
used the GDC intellectual property to develop their own video codec module
product and incorporated it into ADC's AccessPoint and Universal Media
System products. GDC, Ltd seeks an injunction against ADC forbidding it from
selling these products, as well as money damages.
	 MCI WorldCom agreed to pay Cable & Wireless $200 million to settle a
dispute over C&W's purchase of MCI's Internet business. The deal is in
addition to the $23 million awarded in December by an independent
arbitrator. As a result of the settlement, the companies agreed to withdraw
all litigation and regulatory complaints. C&W filed the complaint against
MCI a year ago alleging it had not delivered what was promised when it
bought the business, particularly with regard to key personnel and customer
information.
	 US District Judge Donald Middlebrooks dismissed major portions of lawsuits
filed by MediaOne and TCI TKI against Broward County, FL. Broward County
passed open access legislation in July, and MediaOne, TCI TKI, Comcast, and
Advanced all filed suits against it. The judge dismissed the suits for lack
of standing.
	 SingTel is planning to sue HSBC amid claims that the bank broke conflict
	 of interest rules in handling the battle between the teleco and Pacific
Century CyberWorks over Cable & Wireless HKT. HSBC is serving both
telecommunications carriers in the deal. The legal action will attempt to
block HSBC from being the lead lender to PCCW. The bank had been an
independent adviser to HKT's board of directors, but resigned February 25th.

Mergers/Acquisitions/Divestitures 
	 ADC Telecommunications reported it would buy PairGain Technologies for
	 $1.6 billion in stock to broaden its portfolio of products that provide
high-speed data services over telephone lines. ADC will swap 0.43 shares, or
about $20.13, for each PairGain share. The deal is valued at about $1.6
billion. Alcatel agreed to purchase Newbridge Networks for approximately
	 $7.1 billion. Alcatel intends to finance the acquisition by issuing new
shares equivalent to 17.6 percent of its capital at the time of the deal.
The purchase is expected to be completed by the end of June 2000. Alcatel
hopes the Newbridge buy will allow it to better compete with market giants
Cisco Systems, Lucent Technologies, and Nortel Networks.
	 Despite both companies' pledge to open Internet access to other ISPs and
give consumers a choice of Internet providers, the Senate Judiciary
Committee believes that the AOL and Time Warner merger may allow the
companies to dominate the Internet market and invade privacy. The chairmen
of both companies testified before the Senate Committee that the merged
company would respect privacy. The companies' open access pledge did not
convince Senator Orrin Hatch of Utah, and Senator Dianne Feinstein of
California does not believe that the merger would be a "binding agreement."
	 For the second time in a week, AOL Chairman Steve Case and Time Warner
Chairman Gerald Levin testified before a Senate Judiciary Committee. They
defended their merger and discussed Internet policy issues. The Senate
already expressed skepticism as to whether this merger will allow
competition and secure privacy.
	 AT&T's cable television unit, Liberty Media, agreed to buy Ascent
Entertainment Group for $460 million in cash. Liberty and Ascent agreed to a
deal worth $513.6 million in October, but it was terminated. This new deal
will give Ascent's subsidiary On Command to Liberty Media, which will use it
to provide more video programming, interactive television, and high-speed
data. AT&T, Tata Industries of India, and Aditya V. Birla Group agreed to
	 merge their cellular networks in four states across India. The networks
will be merged into an equally owned joint venture. Once the merger is
complete, the combined companies will have a 25 percent market share on
cellular subscribers. Tata Industries and Aditya V. Birla Group compete
against each other in a number of other industries in India.
	 AT&T Wireless Services' largest affiliates, TeleCorp and Tritel, agreed to
merge in an all-stock deal valued at $5 billion. AT&T will have a 23 percent
stake in the new company. Under terms of the deal, AT&T Wireless Services
will transfer licenses and rights to acquire licenses serving 6 million
people in Wisconsin and Iowa and give TeleCorp $100 million in cash. In
exchange, AT&T WS will acquire TeleCorp's New England properties,
representing 1.9 million people. As part of the contribution, TeleCorp will
issue about 9.3 million shares of Class A common stock at AT&T WS, valued at
about $410 million.
	 BCE's latest move in a string of strategic maneuvers, is an offer to
purchase CTV, a Canadian television broadcaster, for C$2.3 billion, or C$38
per share. CTV owns and operates 25 stations across Canada, and its
programming reaches 99 percent of the English-speaking people living there.
BCE launched the bid in an attempt to increase its Internet services
portfolio, and to bolster its defense against competition from cable
companies, which are starting to offer local telephony services.
	 BellSouth and KPN completed their joint acquisition of German mobile
telephone company E-Plus. The companies now share control of E-Plus, with
BellSouth holding a 22.507 percent share and KPN holding a 77.493 percent
share. Comcast completed its acquisition of Jones Intercable. Each
	 shareholder of Jones Intercable stock will receive 1.4 shares of Comcast
Class A Common Stock for each of their Jones Intercable shares. Jones
Intercable is now wholly a part of Comcast JOIN Holdings, a subsidiary of
Comcast Corporation. Deutsche Telekom sold one of its nine regional
	 cable-television units to Callahan Associates International for $3
billion, after months of changing the terms of the deals. Callahan already
owns stakes in French and Spanish cable operators, but this deal more than
doubles its overall subscriber base to 15 million. Callahan Associates also
is in talks with the former monopoly concerning some of the other networks.
	 In addition, Deutsche Telekom is talking acquisition with Qwest
International and US WEST, which is being acquired by Qwest. According to
the WSJ, DT would land both companies through separate transactions worth a
total of $80 billion.
	 The equally owned venture between Dobson Communications and AT&T Wireless
Services completed the acquisition of American Cellular, which markets under
the Cellular One name, in a deal valued at about $2.4 billion. In addition,
the joint venture entered into an agreement with AT&T that allows American
to access AT&T's wireless network and allows AT&T to broaden its national
footprint.
	 Global Crossing announced plans to acquire IXnet and its parent company
	 IPC Communications, a broadband communications provider, in a combined
all-stock deal valued at about $3.8 billion. Under terms of the deal,
Global Crossing will offer 1.184 of its shares for each share of IXnet not
owned by IPC, which currently owns 73 percent of IXnet. In addition, Global
Crossing will exchange 5.417 of its shares for each IPC share, valuing the
company's stock at $283.71 apiece.
	 Globe Telecom completed its merger with Islacom. The combined companies
	 are worth $2.3 billion and have 1.2 million wireless subscribers in the
Philippines. GST Telecommunications sold its remaining 1.5 million shares
	 in Global Light Telecommunications for $26.8 million.
	 GTE and Bell Atlantic filed formal plans with the FCC outlining the
proposed spin-off of GTE's Internetworking unit and other data related
businesses. The companies' plan to have the Internet backbone and data units
transferred to a public corporation to be owned and controlled by
third-party shareholders. Under the proposed plan, the merged GTE-Bell
Atlantic will retain a 10 percent equity stake in the independent company,
with the option to increase its stake over the next five years, pending
regulatory approval. AT&T filed a complaint with the FCC after the companies
first suggested spinning off the data units, contending that the companies
must divest all interexchange businesses prior to merging in order to comply
with the Telecommunications Act of 1996.
	 Hughes Electronics reported that it is shutting down DirecTV Japan. The
company will transfer its 413,000 subscribers to SKYPerfecTV, a rival
Japanese company. DirectTV Japan's shareholders will receive a total of
182,000 shares, worth $84.8 million, in SkyPerfectTV, giving Hughes
Electronics a 6.7-percent stake in the company. All 500 people employed at
DirecTV Japan will lose their jobs.
	 Mannesmann sold its two-percent stake in Olivetti for 420 million euros.
The company said that funds generated from the sale will go toward paying
down debt.
	 Shareholders of MCI WorldCom and Sprint will vote on the companies'
proposed $115 billion merger on April 28. All shareholders of record as of
March 6 will be eligible to vote.
	 Novell reported its acquisition of PGSoft, a privately held developer of
system software. Through this acquisition, Novell obtains technology and
expertise to expand its leading portfolio of Net services software products.
Financial terms of the acquisition were not disclosed.
	 NTT Communications, NTT's long distance division, agreed to invest $285.65
million in Japan Satellite Systems and hand over its satellite assets, which
are valued at about $286 million, to Japan Satellite. Japan Satellite
Systems will receive N-STARa and N-STARb satellites and their complimentary
equipment, including 26 transponders. In related news, NTT Communications
purchased a 15-percent stake in AT&T's Japanese unit for $50 million. In
exchange for the purchase, NTT Com may appoint two members to the board of
AT&T Global Network Services-Japan.
	 Pacific Century CyberWorks (PCCW) agreed to acquire Cable & Wireless's 54
percent stake in C&W Hong Kong Telecom (HKT) in the largest corporate
acquisition in Asia. HKT shareholders will receive a piece of a $700 million
dividend from C&W before the deal is completed. C&W HKT will change its name
to PCCW Hong Kong Telecom. Thanks to Hong Kong business law, any takeover
bid for more than 35 percent of a company automatically is extended to all
shareholders; thus, the bid is now extended to China Telecom, the other
major shareholder in HKT.
	 QUALCOMM completed its acquisition of SnapTrack for $1 billion in stock.
QUALCOMM purchased SnapTrack's 50 patents along with the company itself.
	 SBC Communications announced that it will acquire Sterling Commerce, an
e-commerce software and services provider, for $3.9 billion. Under terms of
the all-cash deal, Sterling will receive $44.25 for each of its shares. Once
the acquisition is complete, Sterling will function as a subsidiary of SBC
and report to the Global Markets division. The purchase is pending approval
from antitrust regulators.
	 SBC Communications completed the acquisition of Radiofone, which serves
200,000 wireless customers in Louisiana and Michigan. SBC expects to begin
deploying digital wireless service in the Radiofone region, which currently
has analog wireless service and paging, and commence digital services later
this year in New Orleans under the SBC brand name. The transactions brings
SBC's total wireless customer base to about 11.4 million.
	 Sprint completed the financial component of the sale of its interest in
Global One to France Telecom and Deutsche Telekom. Sprint received $1.13
billion in cash and the repayment of $276 million in debt for its entire
stake in the joint venture. DT and France Telecom will resign their sears on
Sprint's board once Sprint shareholders vote on MCI WorldCom's $115 billion
acquisition of the company.
	 Tele Centro Sul, the Brazilian unit of Telecom Italia, acquired an
85.2-percent stake in CRT, a Brazilian company Telefonica was forced to
divest, for about $825 million.

Communications Systems 
	 The WebSwitch 2000 iPBX was released by Ericsson to integrate a standalone
IP-based PBX into an enterprise's LAN. The WebSwitch is designed for small-
and medium-sized companies. It can be used with a LAN or WAN, and, with its
Voice Gateway functions, can be integrated with wireless services.

Personnel and Organizational Changes 
	 Joseph W. Bagan was appointed senior vice president and CIO of AT&T
Broadband and Internet Services, and Judi Boyett Heady was appointed its
senior vice president of Media Services. Bagan is responsible for
information systems and technology plans, reporting directly to CFO Mike
Huseby, while Heady is responsible for advertising strategies, reporting
directly to COO of Operations Administration Bill Fitzgerald.
	 Cabletron Systems plans to divide into four independent operating
companies, Riverstone Networks, Enterasys Networks, Global Network
Technology Services, and Aprisma Management Technologies. Riverstone will
focus on the service provider market, Enterasys Networks will focus on
Global 2000 enterprise customers, Global Network Technology Services will
focus on professional service, and Aprisma Management will focus on
delivering infrastructure management software for service provider and
enterprise markets.
	 France Telecom unveiled a new logo and brand. The company said it will
invest 30 million euros over the next two years to develop awareness for the
new brand. As part of this initiative, France Telecom launched an
advertising campaign on March 1st that will include a number of mediums.
	 Global Crossing named former AT&T executive Leo Hindrey CEO. Hindrey
	 joined Global Crossing in December 1999 as head of the Internet unit. In
addition, the company announced that it will create a tracking stock for its
GlobalCenter Web-hosting operations. The IPO is expected to be completed
summer 2000 and will account for about 20 percent of GlobalCenter. Lucent
	 Technologies is spinning off its PBX operations, Systimax unit, and
LAN-based, data business to form an $8 billion independent company. The
divestiture of these slower-growing business will allow Lucent to recover
from its recent earnings let down and focus on faster growing segments of
the market, such as data networking, optical networking, and wireless. The
yet-to-be-named spin-off company will start out with $8 billion in revenue
and 34,000 employees.
	 Qwest Communications named the management team to head the combined
	 company resulting from its merger with US WEST. Qwest CEO Joseph Nacchio
will continue in his role. The appointments come just days after US WEST
CEO Sol Trujillo announced that he is abandoning his post once the two
companies complete the merger. According to the Wall street Journal,
Nacchio and Trujillo plan to meet to discuss possible merger plans with
Deutsche Telekom. Ron Summer, DT's CEO is reportedly interested in a merger
with one or both of the carriers. US WEST said that it is still committed
to its $36 billion merger with Qwest.
	 French telecommunications company Vivendi reported that it will split its
utility business from the rest of its operations later this year, perhaps as
early as summer. The utility arm will do business under the name Vivendi
Environment. Once the move is completed, the company will list shares in
both units on the New York stock exchange.

Regulatory News 
	 Argentina's Finance Minister announced that the government will completely
deregulate the telecommunications industry over the next 18 months. Thriving
competition in Argentina could cause international long distance rates to
plummet by as much as 50 percent.
	 The Spanish government may shoot down Banco Bilbao Vizcaya Argentaria's
(BBVA) plan to acquire a ten-percent stake in Telefonica as part of a
strategic alliance. The government holds a golden share that allows it to
veto any shareholder from acquiring ten or more percent in the company. The
two companies are the two largest listed companies in Spain, and regulators
feat that their partnership will consolidate too much power.
	 The Senate passed legislation aimed at privatizing the world
	 communications satellite network and ending COMSAT's monopoly on the
market. The law will allow COMSAT to merger with Lockheed Martin, which
already has a 49 percent stake in the company. The measure has the
potential to lower long distance calling rates by allowing telephone
companies to bypass COMSAT and get direct access to the global satellite
consortium Intelsat.
	 German regulators handed down a ruling that Deutsche Telekom must continue
to collect phone bills for competitors whose services are used by DT
customers. The company appealed to regulators to lift the obligation in
April, saying it was too costly, but the regulators said the company must
continue the practice until at least 2001.
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Missy Harvey
Computer Science Librarian
Engineering & Science Library
Carnegie Mellon University
Pittsburgh, PA  15213

http://www.library.cmu.edu/usr/missy/

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