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Date: Thursday, July 27, 2000, 4:20 PM -0400
From: Faulkner Information Services <mailserver@faulknerinfo.com>
To: ???
Subject: Faulkner Comm Flash 07/26/00 - (Part 1 of 2)









Com Flash

Copyright 2000, Faulkner Information Services. All Rights Reserved. 



Publication Date: July 26, 2000



Preview
Com-Flash is a biweekly news summary covering computer systems and
software, and vendors. This flash covers the period July 14, 2000 to July
26, 2000. 



Top of the News
Deutsche Telekom increased its bid for VoiceStream Wireless from, the
original offer of $50.7 billion to approximately $53 billion. DT is
offering to hand over 3.2 shares of its common stock and $30 cash for each
share in VoiceStream, valuing VoiceStream stock at $205.60 per share.  DT
also will invest $5 billion in the wireless company and will assume $5
billion of its debt. Sonera will receive a 1.7 percent stake in DT in
exchange for its 7.9 percent slice of VoiceStream. Hutchison Whampoa,
another major VoiceStream shareholder, will receive about $10.96 billion in
cash and stock for its 22 percent stake. The Finnish company said it plans
to divest its DT stake. A combined T-Mobile--DT's wireless division--and
VoiceStream will operate the only worldwide wireless network based on the
GSM standard. The deal has already been cleared by both companies' boards.



Mergers/Acquisitions
3Com agreed to buy Internet radio maker Kerbango for $80 million in cash in
its latest move into the market for information appliances. Kerbango
designed a device that lets users listen to more than 5000 stations around
the world on the Internet without needing to connect to a personal
computer. 3Com said the deal will be accounted for as a purchase and is
scheduled to close during the first fiscal quarter.  

ADC completed the acquisition of PairGain Technologies. The acquisition is
structured as a tax-free reorganization for US federal income tax purposes
and is intended to be accounted for as a pooling of interests. Each share
of PairGain's common stock will be converted into 0.43 share of ADC common
stock. 

As part of a plan to expand its wireless network and services, AT&T
Wireless agreed to acquire the Indianapolis wireless system from SBC for
$530 million. The boards of both companies have already approved the deal
and AT&T and SBC are waiting for regulatory approval. AT&T Wireless is
filling a hole in its footprint while adding over 113,000 subscribers
through the acquisition. For SBC, the transaction is a condition for
approval of its proposed venture with BellSouth that would create a
national wireless company. Since BellSouth already owns a property in
Indianapolis, SBC had to divest itself of its own property because of
federal spectrum cap regulations. 

Celumocil, a unit of BellSouth in Colombia, purchased Cocelco, the
country's third largest wireless provider. BellSouth owns more than half of
Celumocil and encouraged and supported the acquisition. The combined
company will become Colombia's largest cellular phone company with more
than one million subscribers. 

Rupert Murdoch's British Sky Broadcasting (BSkyB) boosted its stake in
Open, a joint venture that provides interactive television services, to a
controlling 80.1 percent for $788 million. The company made this move by
buying out two of its partners in Open. It acquired a 20 percent slice in
Open from HSBC Holdings, an investment bank, and a 15 percent stake from
Matsushita. BSkyB also agreed to buy a number of newly created Open shares.
British Telecom, which is the other partner in Open, has the right to
divest its 19.9 percent stake to BSkyB in 2001. 

Cable &Wireless vaulted itself into the position of the third largest
Internet services company in Europe by agreeing to acquire five ISPs for a
combined price of $100 million. C&W will acquire Eaisa (Spain), Pictime
(France), POP Point of Presence (Germany), Impact Group (Netherlands), and
Widexs (Netherlands). Combined, these companies have annual revenues of
approximately $40 million and have about 30,000 customers. These moves mark
the 22nd ISP acquired by C&W since January 1999. 

Chello Broadband, the ISP division of United Pan-Europe Communications
(UPC), agreed to merge with the international operations of Excite@Home.
The combined company will be called Excite Chello, and it will provide
service to more than 300,000 subscribers in 15 countries across Asia and
Europe. Excite and UPC will each hold 43 percent of the combined company,
with Liberty Media owning four percent and management owning the remaining
10 percent. This "corporate marriage" gives Chello an immediate presence in
the Asia/Pacific, since Excite has operations in Australia and Europe;
Excite gains access to Europe via UPC's continent-wide fiber networks. This
merger also presents a huge opportunity in the European marketplace. Less
than one percent of homes there have broadband access, but that number is
expected to skyrocket to 18 percent over the next five years. In
conjunction with the deal, Liberty Media, which is owned by AT&T, and
UnitedGlobalCom, the parent for UPC, agreed to invest $187 million and
$93.8 million, respectively. Liberty Media owns a controlling interest in
UnitedGlobalCom. 

Cisco Systems announced a definitive agreement to acquire privately-held
Netiverse, a provider of content acceleration technology that enhances
networking devices, strengthening Cisco's content networking services.
Under the terms of the agreement, Cisco common stock worth an aggregate
value of approximately $210 million will be exchanged for all outstanding
shares and options of Netiverse. 

Citizens Communications acquired 1.1 million access lines from Global
Crossing for $3.65 billion in cash. The deal helps Global Crossing focus
more on its telecommunications services and broadband network. The two
companies also entered a strategic agreement whereby Global Crossing will
provide long distance services. 

Deutsche Telekom is at the negotiating table with Disney concerning a
possible purchase of the media company's 25-percent stake in Webseek.de, a
search engine. DT figures that boosting its stake in the search engine
makes strategic sense, since 80 percent of Webseek's traffic comes from
subscribers of Telekom's T-Online. Webseek is linked to Infoseek, the
search engine owned and operated by Disney; and a topic of dispute is
whether or not the remaining partners in Webseek will retain the right to
leverage the Infoseek name once Disney is out of the picture.  

In other news, Deutsche Telekom agreed to acquire a 51-percent stake in
Slovenske Telekomunikacie, the Slovak Republic's telecom monopoly, for $1
billion. DT plans to invest $940 through 2003 to develop basic services and
upgrade Slovenske's network.  

In a reverse action, Deutsche Telekom agreed to sell its 24.5 percent stake
in Italian telecom consortium Wind to France Telecom and Enel, an Italian
utility, for a total of 2.7 billion euros. France Telecom will acquire an
additional 18.9 percent chunk of Wind, bringing its holding to 43.4
percent, for 2.08 billion euros. Enel will increase its stake from 51
percent to 56.6 percent for 620 million euros.  

Equant broke off merger talks with France Telecom. The French company
offered to acquire the 33.4 percent chunk in Equant held by SITA, an
airline consortium that is looking to divest its stake in the global
telecom firm. France Telecom is the second company unable to work out a
deal for a stake in Equant. Reportedly, Equant is still involved in
negotiations with another company. 

In addition, France Telecom and Kulczyk Holding will acquire 35 percent of
Telekomunikacja Polska (TPSA), the incumbent Polish telecom concern, for
$4.33 billion, or approximately $8.78 per share. France Telecom will
receive 25 percent of TPSA with Kulczyk receiving the other 10 percent. FT
and Kulczyk also have the right to buy the rest of TPSA through a series of
trenches by the end of 2001. As a condition of the deal, the Polish
government agreed to award TPSA a third-generation wireless license. 

Global Crossing purportedly rejected Exodus Communications' $6.5 billion
bid to acquire the Bermuda-based company's Internet hosting services. The
Web-hosting business, GlobalCenter, expects to raise at least that much
through a pending public offering of tracking shares.  

Believing it has a stronger deal than Arch Communications, Metrocall
submitted a merger proposal to PageNet's board of directors. Under its
proposal, Metrocall is offering $100 million to holders of PageNet senior
notes and 13.0 million shares of its new common stock to PageNet
shareholders. 

NetCom, a Swedish carrier, placed a $3.11-billion bid on the table for
Societe Europeene de Communications. Under terms of the all-stock offer,
NetCom will hand over one share of its Class A common stock in exchange for
11.5 shares of Societe's Class A common stock as well as one share of its
Class B common stock in return for 11.5 shares of Societe's Class B common
stock. If the bid is accepted, NetCom will gain operations in Germany,
Switzerland, Austria, the Netherlands, Italy, France, Liechtenstein, and
Luxembourg. 

NTT DoCoMo said that it will pay four billion euros for a 15-percent stake
in KPN Mobile instead of the five billion euros originally expected. 

Orange announced a trio of acquisitions as part of its strategy to develop
its Internet services. The company agreed to acquire Ananova, a search
engine and virtual newsreader; Wildfire, a voice recognition and virtual
personal assistant, for 95 million pounds each; and a 25 percent stake in
NewsTakes, which reformats Web pages so they can be viewed via wireless
phones.  

Proxim acquired privately held Farallon Communications, developer of
plug-and-play networking products. Through this acquisition, Proxim will
broaden its offerings for the home networking, small business, and
education markets by adding Macintosh-compatible wireless connectivity and
other broadband networking products, strengthening Proxim's position in the
market. Proxim purchased Farallon for 121,654 shares of Proxim's common
stock worth approximately $10 million and $4 million in cash. 

Seat Pagine Gialle-Tin.it, a media and Internet company being formed by
Telecom Italia, is in acquisition negotiations with Telemontecarlo (TMC),
the third-largest television network in Italy, from Vittorio Cecchi Gori.
Seat Pagine Gialle-Tin.it is being formed through the merger of ISP Tin.it
and directory publisher Seat Pagine Gialle. 

Sprint announced that it is still divesting its 25-percent stake in Intelig
even though the MCI WorldCom merger is off. Sprint was order to shed the
stake in January because WorldCom controls its Brazilian rival Embratel.
Company officials said Sprint would pursue other opportunities in the
country. 

Telefonica agreed to divest its 85-percent stake in Companhia Riograndense
de Telecomunicacoes (CRT) to Brasil Telecom for $800 million, bringing to
an end a bitter dispute between the Spanish company and the Brazilian
government. Brazilian regulators ordered Telefonica to divest itself of CRT
as a condition of its purchase of Telecomunicacoes de Sao Paulo, another
Brazilian telecom company. The price was a compromise reached with Brasil
Telecom, which is owned by Telecom Italia and Opportunity, a Brazilian
investment firm. Telefonica initially wanted $850 million fot the stake,
while Brasil Telecom was offering $730 million. The sale was approved by
court, which went against the governments desire to sell the stake to
Anatel.  

Also, Telefonica Internacional, a subsidiary of Telefonica, and Portugal
Telecom agreed to swap shares in Brazilian telecommunications companies.
Portugal Telecom will receive a 35.8 percent stake in Porelcom
Participacoes, which controls Telesp Celular Participacoes, and $59.9
million. In return, Telefonica will receive a 23 percent indirect stake in
SP Telecomunicacoes, which controls Telesp Participacoes. 

Telstra agreed to acquire Keycorp for $300.2 million. The two firms also
formed an alliance to offer payment and Internet services to financial and
merchant customers. 

WorldCom's president, Brenard Ebbers, announced that the merger with Sprint
is dead; he also criticized federal authorities for hurting an industry
that is not in need of such strict regulation. The Justice Department
stated that a merger of the world's 2nd and 3rd largest long-distance
carrier would only make Americans pay more money for less service. After
learning that the companies could not merge in the US, they filed their
merger application in Europe where it was too, rejected. 



Alliances/Joint Ventures
ADC signed a global framework agreement with Compaq, covering the service
assurance elements of the Singularit.e suite of OSS products. The agreement
will enable Compaq to offer products and services including network
performance management, service level agreement tools, and network
performance management for carrier-class IP services. 

Artisoft signed an agreement with Euroline to distribute Artisoft's
TeleVantage phone system to Euroline's network of computer telephony (CT)
partners in Norway. Euroline is trained on Dialogic hardware, upon which
TeleVantage's open system architecture is based. 

AT&T and Insight Communications signed an agreement to offer phone service
over Insight's cable infrastructure. AT&T will install and maintain the
needed switching equipment, and will be the local exchange carrier. Insight
will maintain and provide access to its upgraded cable infrastructure. AT&T
will collect the telephony revenues and will pay Insight a monthly per-line
access fee for the local loop. The service will be marketed by Insight
independently and as part of a bundle of telecommunications and cable
services. 

Broadbase Software and BEA Systems reported a strategic alliance to
integrate Broadbase's analytic and marketing automation applications with
BEA WebLogic Commerce Server and BEA WebLogic Personalization Server. Both
companies will then jointly market the product sets. 

Also, BEA Systems and NEC will ally to combine BEA's E-Commerce Services
Division with NEC's systems integration expertise to deliver a B2B
e-commerce service to the Japanese market. BEA will expand the agreement by
providing the BEA WebLogic Server and other products for NEC's e-business
initiative, iBestSolutions. BEA Systems also formed an alliance with TANTAU
Software to enable e-businesses to extend wired e-commerce services for
mobile device users.  

BellSouth and Talk Visual signed a two-year ISDN contract service
arrangement. The agreement allows Talk Visual to offer its customers in the
BellSouth region 128K bps ISDN services with free installation and a
monthly fee of $69.00. The monthly service includes 9,600 minutes of local
ISDN calls. 

Blockbuster and Enron Broadband Services inked a 20-year partnership that
will allow Blockbuster to offer streaming movies on demand to customers via
a computer or television with a broadband connection. Customers will need
to rent-to-purchase a set-top box in addition to a cable or DSL connection
to receive the transmissions. This service will offer approximately 500
movie titles and is expected to be rolled out in select markets by the end
of the year. By comparison, DirecTV offers about 55 pay-per-view movie
titles at any one time. 

NetReality entered into a technology partnership with BMC Software to
integrate NetReality's WiseWan service with BMC's PATROL product line. The
combined service will optimize network performance for business-critical
applications by leveraging the combination of WiseWan's data collecting and
traffic shaping capabilities for WANs and PATROL's application management
and monitoring expertise. 

Cisco Systems and Hewlett-Packard teamed to accelerate the deployment of
contact center services that offer global consulting, systems integration,
and e-services to enterprise and service provider customers. This expands
both companies' strategic alliance, allowing HP to integrate and resell the
customer contact software platform from Cisco's Internet Communications
Software Group (ICSG). 

Intira and EMC formed a channel partnership to curb the growing e-business
demand for infrastructure and data storage resources. Intira and EMC market
IT and networking infrastructure, or Netsourcing services. Under the
channel partnership, Intira will leverage EMC's Enterprise Storage systems,
software, and networks through its integrated IT and network
infrastructure. 

Global Crossing and 360networks signed multiple agreements valued at $180
million. Under the agreements, 360networks acquired a bundled of
high-bandwidth capacity on more that 8000 miles from Global Crossing and
multiple OC-48 channels enabling it to offer up to 10G bps capacity on
selected routes connecting major US markets. Additionally, Global Crossing
agreed to purchase more than 2300 miles of dark fiber from 360networks on
five routes in the western US and Canada.

Additionally, 360networks will invest $800 million in a joint venture with
C2C, a subsidiary of SingTel, to develop a submarine cable network in the
Asia/Pacific region. In return, 360networks will receive backhaul capacity
on the network. The network will connect China, Singapore, Hong Kong,
Taiwan, the Philippines, South Korea, and Japan. 

Globe Telecom, a venture between SingTel and Ayala Corp, and Islacom, which
is backed by Deutsche Telekom, committed to invest between $800 million and
$1 billion in a Philippine wireless venture. Globe and Islacom, which
announced plans to merge earlier this year, will be the largest digital
wireless company in the country, with 320,000 wireline customers and 1.2
million wireless subscribers. But before the investment can be made,
Islacom needs to renew its operating license, which was not renewed after
March 29, 1999 because the company failed to meet installation
requirements. 

Hutchison Whampoa, NTT DoCoMo, and KPN Telecom forged a three-way
partnership to secure third-generation wireless licenses across Europe,
splitting the costs of acquiring licenses and deploying 3G networks. Under
the deal, DoCoMo will acquire 20 percent of Hutchison 3G UK Holdings,
Hutchison Whampoa's UK wireless arm, for 1.2 billion pounds. KPN Telecom
will take a 15 percent stake in the British wireless venture for 900
million pounds. Then, Hutchison and E-Plus, a KPN-owned German wireless
company, will form an equally owned joint venture to bid on a 3G wireless
license in Germany. The partners are not ruling out enlisting additional
help in bidding on licenses in France and Belgium. 

KPNQwest and Inktomi formed an alliance to expand capabilities for content
distribution and streaming media on KPNQwests pan-European IP network. The
companies' report that the integration of Inktomi's Network Products into
KPNQwest's network is designed to improve the access and delivery of
content. 

Lucent, Fujitsu, and NTT Communicationware will supply an experimental IP
core network system for NTT DoCoMo's mobile communications development
plans. DoCoMo will use the system to evaluate an all-IP core network for
use in mobile communications. The trial system includes Fujitsu's EA1000 IP
router platform for IP core networks and mobile IP platform for managing
voice and data mobility using IP technology. It also uses Lucent's
Softswitch-based call agent platform and APX 8000 multi-service access
switch. NTT Communicationware will provide service applications. 

Micromuse inked an agreement with Internetwork Integration (INT2) to resell
its Netcool suite applications. INT2 will implement the Netcool suite to
enable a managed network monitoring service for turnkey, outsourced
development and integration of a network, system, and software
infrastructure. 

Telstra selected Nortel Networks as primary infrastructure supplier for its
New Generation Telephony (NGT), an offering expected to harness the power
of a high-performance Internet to deliver advanced IP voice and data
services. According to the companies' Letter of Intent, the contract is
said to be worth upwards of $100 million, to be deployed over a three-year
period. 

SBC Communications will acquire InQuent Technologies, a company that
manages Web sites for businesses, and will also complete several
partnerships with Commerce One, Deloitte Consulting, and Proxicom. The
company reports that the recent strategies are designed to broadening the
range of its electronic-business services. 

Open Systems Solutions formed a partnership with StorageTek to combine its
in-house data storage specialists with StorageTek's in data storage systems
to create a superpower in the industry. OSSI's partnership with StorageTek
will provide a basis for investing in strong data storage services. 

Overland Data reported that StorageTek signed a definitive agreement to
license Overland's Variable Rate Randomizer (VR2) technology. Overland's
StorageTek will integrate Overland's VR2 technology into StorageTek's 9840
tape drive technology, both access-centric and capacity-centric versions. 

Symantec entered a general distribution agreement with Legend Digital China
to strengthen its mark in China. The agreement states that as the
authorized distributor of Symantec's software products in China, Legend
Digital China will strengthen Symantec's sales channels and establish
technological support and training centers. 

Telefonica and Microsoft announced a joint services agreement by which
Telefonica will use Microsoft software designed for call centers, wireless
telephony, and Internet services. In exchange, Microsoft will gain access
to fixed and wireless telephony services and call centers in countries
serviced by the Spanish telco. The two also will jointly develop
applications and technologies for clients. 

Also, Telefonica Moviles and Terra Networks formed a joint venture called
Terra Mobile that will oversee Telefonica's wireless Internet operations.
The new company, which is 51 percent-owned by Telefonica Moviles and 49
percent-held by Terra, will operate Telefonica's wireless Internet portal. 

Verizon Communications and Davox signed a product purchase and distribution
agreement authorizing Verizon to use and market Davox's Ensemble customer
contact suite - an inbound, outbound, and blended customer contact
solution. Davox Corporation is a current provider of customer interaction
management services to over one thousand customers. 

Verizon Wireless signed a number of alliances to enhance its Mobile Web
offering. Verizon Wireless customers will be able to access up-to-date
weather information from weather.com, buy tickets from Ticketmaster
Online-Citysearch, and plan meals at Allrecipes.com. Customers can also
access road travel information from eXitSource and sales data base from
SalesMountain.com. 



Electronic Business
Avaya introduced CRM Agent Access, a package of computer telephony
integration-enabled applications available in three configurations. The
basic edition delivers "screen pop," for viewing account data upon call
arrival, and "soft phone," for telephone capabilities through the computer
screen. To these capabilities, the expanded edition adds task automation
features. The routing edition affords businesses an added layer of
intelligence for determining which resources best address customer needs. 

Enterprise communications offerings provider Brooktrout Software and
wireless software developer RTS Wireless introduced an application designed
to allow subscribers of Internet services to listen to their e-mail using
digital mobile phones. The e-mail reader, which will be offered to
enterprises and ISPs, was developed with Show N Tel, Brooktrout Software's
Windows NT-based rapid application development environment for
communication offerings that integrate phones, PCs, and the Internet. 

Flooz.com reported that it is licensing speech recognition technology from
NetByTel to enable e-commerce transactions via voice telephone calls.
Flooz, which offers online gift certificates, will license NetByTel's
telephone e-business platform, NetByTel Connected, to allow customers to
shop on the Web without an Internet connection.  

Novell unveiled DirXML, integration software that enables new business
services to migrate to e-Business. DirXML utilizes the NDS eDirectory by
allowing first-time companies to fully integrate business processes and
existing applications across the enterprise. DirXML combines an XML and
DirXML cross-platform and cross-network information exchange, centralizing
a company's e-business processes and delivering a unified global network. 



Internet
AT&T introduced its WorldNet Service i495. The Internet service features
150 hours of free access, six e-mail addresses, and up to 60 MB of Web
space for $4.95 per month. In exchange for the discounted service,
customers will see a multi-function toolbar that delivers customized
advertising and customer service messages. During registration, users are
assigned an anonymous ID number that is used to track URLs that are
visited. Participating companies target appropriate audiences based on the
Web sites consumers visit. 

BellSouth customers can now pay their bills online through the TransPoint
Online Bill Payment Service. Customers can also check the status of their
TransPoint account 24 hours a day, 7 days a week. 

ITXC is carrying phone-to-phone calls over the Internet from customers of
RBOCs. The company claims that it is the first Internet telephone carrier
to serve RBOC market. In previous announcements, ITXC agreed to terminate
calls from Bell Atlantic and Ameritech customers. 

To strengthen the recent SBC/Prodigy alliance, all Prodigy sites, including
the corporate website, Prodigy's dial-up site, and the DSL member homepage,
will feature SMARTpages.com, SBC's web-based yellow and white pages
directory. SBC will become the exclusive provider of online directories for
Prodigy.  

Sprint customers living in New York City and its surrounding area can now
order their long distance plans and other related services online. By
accessing www.sprint.com/local, customers can research Sprint products,
choose from a variety of plans, and order calling features online. 

Sprint will provide its residential customers with the tools to
self-install their Sprint FastConnect DSL service beginning August 1, 2000.
The kit is available free on a promotional basis to new customers that sign
an annual contract for Sprint FastConnect service. The kit includes a DSL
Self-install CD-ROM enabled by BroadJump's Virtual Track Installer software
and a standard DSL modem. The software automatically configures the
customer's computer for broadband Internet access and establishes
connectivity to the DSL network. The $45 monthly fee includes EarthLink
Sprint Internet access. 



Messaging and Groupware
Avaya, the former Enterprise Networks Group of Lucent, plans to combine its
DEFINITY AnyWhere remote worker communication, Unified Messenger for
Microsoft Exchange, and iCosm Interaction Manager products into one
e-communication suite. The suite is designed to allow companies to increase
the speed of remote worker communications. Compaq and Hewlett-Packard plan
to join forces with Avaya to develop Unified Messenger services. The
companies intend to sell and implement the suite for large businesses and
the government. 

Candle reported the release of IntelliWatch Monitor for AS/400, which
identifies and corrects Notes server issues on the AS/400. IntelliWatch
Monitor for AS/400 is the first product that monitors Notes applications on
the AS/400, extending its Notes monitoring capabilities already extant with
Windows NT and UNIX. IntelliWatch for AS/400 analyzes and automatically
corrects Note server issues such as mail management, log messages, and
backups or gateways. 

HostPro reported that it is working with Microsoft to provide hosted
managed services, including the Microsoft Exchange 2000 Server, on the
Windows DNA platform. Developing the Exchange 2000 Server is part of
HostPro's mission to build services for integration, distribution, and
management of critical and e-commerce application services. 



Carriers and Carrier Services
AT&T is lowering its rates in Vermont as a result of a Vermont Public
Service Board order mandating that Verizon Communications, formerly Bell
Atlantic and GTE, reduce intrastate access charges. AT&T is reducing its
daytime rate from $0.30 per minute to $0.20 per minute, evening rates will
drop to $0.15 per minute from $0.21 per minute, and weekend rates will fall
$0.02 to $0.12 per minute. AT&T's One Rate plan has also been reduced by as
much as 20 percent. 

In other news, AT&T petitioned the Pennsylvania Public Utility Commission
to allow it to offer cable telephone services in rural western Pennsylvania
communications services by ALLTEL North Pittsburgh and other independent
phone companies. AT&T is investing $300 million to upgrade its cable
networks in the region and intends to initially offer cable telephone
service to residential customers. The company plans to eventually offer
cable telephone service to small businesses. An Administrative Law Judge
will rule on the request by September. 

Also, AT&T and Southern New England Telephone (SNET) were at the top of JD
Power and Associates' 2000 Residential Long Distance Customer Satisfaction
Study. According to the survey, AT&T ranks highest among high-volume
customers that spend more than $50 a month for long distance services.
Sprint ranked second. MCI WorldCom and Qwest finished below the industry
average for that segment. SNET led the pack for mainstream users who spend
less than $50 a month for long distance service, followed by ALLTEL and
CenturyTel. AT&T, Citizens Communications, and MCI WorldCom all fell below
industry average for that group. Factors considered in the survey were
customer satisfaction, corporate image/communication, billion, bundling
services, and operators. The study also revealed that the number of long
distance-related problems increased from 51 percent in 1996 to 59 percent
in 2000. 

DDI announced its intentions to enter the local telephony market in Japan,
adding yet another name to the list of companies preparing to compete
against NTT. DDI plans on rolling out service in May 2001, and it
attributes its decision to the Carrier Selection Service, which allows
consumers to select their service provider without having to dial a prefix
number to use a company other than the incumbent NTT. DDI said its will
charge about nine yen per three minutes for local calling. Japan Telecom
also is planning to begin providing local telephone services. 

Equant launched an IP telephony service that allows customers to make calls
from 54 countries around the globe. 

GTE and USA Digital entered an expanded interconnection agreement, which
allows USA Digital to purchase and resell GTE services, to co-locate its
equipment in GTE central offices and to access GTE's unbundled loops at
rates comparable to major CLECs. This agreement allows USA Digital to
expand into 37 states where GTE offers service. 



Wireless Communications
3Com delivered a wireless secure tunneling product that adds seamless Layer
3 tunneling, authentication, and encryption to the 3Com AirConnect 11M bps
Wireless LAN. 3Com's wireless secure tunneling offers a scaleable Layer 3
offering that seamlessly integrates wireless LAN security into a company's
existing network infrastructure. 

AOL agreed to offer its content through AT&T Wireless Services. As part of
its AOL Anywhere plan, the Internet company will allow AT&T's Digital
PocketNet users to have access to AOL's e-mail, instant messaging, and
other Internet content. 

AT&T and British Telecom announced that Advance, a wireless venture between
the two firms, is going live with two global wireless calling plans:
WorldConnect and WorldView. Both services allow customers to use the same
phone number while roaming to more than 100 countries around the world.
Most of the value-added features available to wireless subscribers will be
available as customers move around the globe as well. WorldView offers
similar features, but it is designed for multinational corporations.  

3Com delivered a wireless secure tunneling product that adds Layer 3
tunneling, authentication, and encryption to the 3Com AirConnect 11M-bps
Wireless LAN. 

Japanese telcos DDI and IDO, which are merging with KDD, announced an
international roaming agreement with Verizon Wireless that allows wireless
customers will be able to use their handsets in 12 cities in the US by the
end of July 2000. 

Integra Micro Systems created the first WAP browser in India by porting its
WAP Stack on Palm OS. Customers in India can access Internet information or
services by using a WAP-enabled mobile device. The creation of the
country's first WAP browser is part of Integra's plan for full WAP
compliance. The company is also meeting this goal by developing the Jataayu
WAP client, which can be used by applications developers without the
restrictions of a mobile device. 

i-mode, the wireless Internet service offered by NTT DoCoMo, crashed yet
again, this time for 15 hours. The company said the failure was related to
switching problems and effected 240,000 customers in central and
southwestern Tokyo. The wireless Internet service is extremely popular in
Japan, with a 60 percent market share, but its repeated failure has caused
NTT to halve the number of new subscribers it will allow to sign up for the
service for six weeks. 

The wireless division of Qwest Communications launched its all-digital
wireless voice and data service in Boise, including Ada and Canyon
counties, and Spokane and surrounding communities in eastern Washington.
The company will also launch service in western Montana, including Butte,
Helena, Great Falls, and Missoula in early August, with plans to expand to
eight additional markets by the end of the year. The company currently has
650,000 wireless customers in eight western and mid-western states. 

Sprint PCS Network Partner, US Unwired, launched Sprint PCS service in nine
markets, increasing the number of markets it serves to 20. The new Basic
Trading Areas include Anniston, AL; Hot Springs, AR; Mobile, AL; Jackson,
Meridian, and Vicksburg, MS; five counties surrounding Birmingham, AL; four
counties surrounding Little Rock, AR; and Jackson County, FL.  

Verizon Wireless announced that it completed the first third-generation
wireless data call using Lucent's commercial network. The two companies
demonstrated the call by downloading a wireless Web page at a speed 10
times faster than current CDMA networks. Verizon Wireless and Lucent are
working on circuit packet and software upgrades to allow the wireless
company to meet the International Telecommunications Union's 3G
requirements. 

In addition, Verizon Wireless launched Mobile Web. Mobile Web allows
wireless customers  access to the Internet through Verizon web-enabled
wireless phones. Verizon is currently forming alliances that will bring the
top available to their wireless customers, including InfoSpace, a leading
global provider of information and commerce infrastructure services for
wireless devices, merchants, and Web sites. InfoSpace will provide wireless
customers with an integrated platform of services, from shopping online and
instant messaging to reading news and checking weather. 

The Dutch auction for third-generation wireless licenses ended when a
dispute erupted between two of the participants. VersaTel said it was
forced to drop out of the auction after the Dutch government refused to
take action concerning a complain filed by the company against Telfort.
VersaTel said it was threatened with legal action by Telfort if it bid more
in the auction than Telfort could afford. The five licenses were won by
Libertel (1.57 billion guilders), KPN Mobile (1.57 billion guilders),
Dutchtone (960 million guilders), BT-owned Telfort (947 million guilders),
and 3G Blue-a consortium of Ben and Deutsche Telekom (870 million
guilders). The sudden ending to the auction left the Dutch government with
5.9 billion guilders, about a third of what it expected to bring in by
selling the licenses. 



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