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Date: Monday, November 27, 2000, 9:53 AM -0500
From: Faulkner Telecom Weekly <telweekly@faulknerinfo.com>
To: ???
Subject: Faulkner Telecom Weekly Nov 24, 2000



Telecom Weekly

November 20 - November 24, 2000

Top Story of the Week

Time Warner Opens Lines to EarthLink (11/21/2000)
In a move that may mollify federal regulators wary of  its proposed merger
with AOL, cable giant Time Warner agreed to open its cable lines to
Internet service provider EarthLink. Under the terms of the agreement, Time
Warner will offer EarthLink's high speed Internet access, content,
applications, and features to Time Warner cable subscribers. The agreement
comes after Time Warner and AOL extended the FTC's review period of their
proposed merger by two weeks. The most contentious issue in that review was
the availability of Time Warner's cable systems to AOL competitors. With
the FTC and FCC's approval, the companies expect the merger to close by the
end of 2000 or early 2001.


Acquisitions, Mergers, and Divestitures
Wanadoo Confirms Deal with Freeserve (11/22/2000)
French Internet service provider, Wanadoo confirmed it was eyeing a
takeover of British rival, Freeserve, a deal which would establish it as
one of Europe's top three ISPs.

DoCoMo Taking Stake in AT&T (11/22/2000)
NTT DoCoMo  could agree to buy a $9-billion stake in AT&T
Wireless. The transaction would give the Japanese company a 20-percent
stake in AT&T Wireless and signals its entrance into the US market. The
investment from DoCoMo would boost AT&T Wireless' financial picture as it
is set to become an independent company as part of AT&T's restructuring
plan. The company could use the money to bid in the upcoming wireless
spectrum auctions and could  pay off some of its $62 billion in debt. NTT
DoCoMo's agreement with AT&T Wireless is part of the former's strategy to
create a global presence for itself. It is also in talks with Cingular
Wireless and has concluded a  $100-million deal with AOL.

Verizon May Renegotiate NorthPoint Buy (11/22/2000)
Verizon Communications may renegotiate its agreement to purchase 55-percent
of NorthPoint Communications, sources speculate. A lot has changed since
August, when Verizon agreed to take a 55-percent stake in NorthPoint for
$800 million and announced a plan to create a nationwide joint DSL
business. Since then, NorthPoint's market capitalization has fallen from
$1.9 billion to less than $400 million. The company also recently announced
that revenue for the third quarter would be lower than originally reported
due to customers' defaulting on bills. If the deal were to commence as
previously announced, Verizon would pay more than twice NorthPoint's market
value for a little more than half of the company. The deal includes a
provision that allows Verizon out of the agreement if there is "a material
adverse change" in NorthPoint's business; but NorthPoint remains confident
that its recent troubles will not affect the Verizon deal.

Verizon Acquires Stake (11/21/2000)
Verizon Wireless acquired the remaining stake in Sacrament Valley Limited
Partnership, a wireless service provider for the Northern California and
Nevada regions. Verizon will pay Centennial Communications $236 million for
the  23.47-percent stake, which includes 865,000 POPs. Verizon Wireless now
serves a number of markets in the western US including Sacramento,
Stockton, Modesto, Chico, Redding, and Yuba City in California and Reno in
Nevada.

Ericsson Extends Tender Offer (11/20/2000)
Ericsson's subsidiary, Ericsson MPD Acquisition, extended its tender offer
for the acquisition of Microwave Power Device's outstanding common shares.
The offer has been extended until November 27 at 12:00 midnight EST.

FT Wants Equant Control (11/20/2000)
France Telecom plans to acquire a majority stake in Equant and to combine
it with its own data subsidiary, Global One. The merged company would have
around 3700 customers and revenues of $2.5 billion to $3 billion. The
merged company would continue to be listed  on both the Paris Bourse and
the New York Stock Exchange.

C&W Looks to Sell PCCW Stake (11/20/2000)
C&W seeks a buyer for its 15-percent stake in Pacific Century CyberWorks at
an asking price of $3.56 billion.




Alliances and Joint Ventures
@Network and Level3 Form Asia Alliance (11/21/2000)
@Network and Level 3 signed an agreement to send data from Asia to North
America and Europe using Level 3's network. @Network will make available
its Asian-based collocation, globalization, and managed services as part of
the Level 3 Enabled Global Partner Program. The agreement enables @Network
to provide its services to Level 3 customers globally, while using Level
3's undersea and metropolitan Asian fiber optic network to provide higher
bandwidth availability to its customers.

AT&T Wireless Allies with buy.com (11/21/2000)
AT&T Wireless forged an alliance with buy.com to provide its Digital
PocketNet customers with access to buy.com's Web site. Users can access the
site through the Shopping channels on the AT&T Web site and the AT&T Surf
Lounge homepage available through PocketNet. Through buy.com, customers can
purchase computer, software, electronics, music, videos, and many other
retail items.

QUALCOMM Expands License (11/21/2000)
QUALCOMM is expanding NEC's CDMA license agreement that allows NEC to have
access to QUALCOMM's CDMA technology for the development of new services.
The amendment to the original license agreement allows NEC to pay royalties
and a license fee to QUALCOMM at the same rates for 3G as those paid for
cdmaOne equipment.

WebLink Joins with agentGO (11/20/2000)
WebLink Wireless and agentGO are working together to develop intelligent
and always-on mobile applications. agentGO is combining its agent-based
mobile application platform with WebLink Wireless' messaging network. The
two company's solutions will be aimed at enterprises.




Broadband/Cable Networking
Lucent Building Belgacom's Network (11/21/2000)
Lucent Technologies signed a three-year, EUR 30-million agreement to build
Belgacom's optical backbone, which makes up the company's pan-European
network. Lucent is delivering its DWDM-based technology, including its
WaveStar OLS 400G systems, to be included in the backbone. The company's
technology allows for multiple wavelengths to be carried over one strand of
fiber. With the network, Belgacom will have a maximum network capacity of
400G bps, carrying 40 data streams over one fiber simultaneously. Lucent is
constructing the backbone in the UK, France, and Germany.

Teleglobe Buys $400 Million of Nortel Gear (11/21/2000)
Teleglobe and Nortel Networks signed a $400-million agreement to
incorporate Nortel's optical Internet capabilities into Teleglobe's global
IP network. With the OPTera Long Haul 1600 Optical Line System from Nortel,
Teleglobe will be able to offer Internet and voice services, including IP
and ATM services such as VPN, to customers in North America, Europe, and
Asia. The company's GlobeSystem network capacity will be increased to 800G
bps, and the system will support next-generation data networks. Under the
agreement, Nortel is also providing network and project management
services.

Undersea Cable Break Causes Internet Logjam (11/21/2000)
Millions of Internet users suffered major traffic jams after an undersea
cable that connects Australia, Asia, the Middle East, and Europe was cut.
Telstra, which relies on the cable for about 50-percent of its Internet
traffic, and Singapore Telecom managed to redirect most of their traffic to
another undersea cable. While the cause of damage was unclear,
possibilities include a ship or ship's anchor, since the break occurred in
"relatively shallow water."

Brazil Added to Global Crossing Network (11/22/2000)
Global Crossing announced a seamless fiber optic link from Brazil to North
America, Europe, and Asia. It is the first company to link these areas over
one seamless fiber optic network.




Financial News
Financial Warning by Lucent (11/20/00)
Lucent's fifth financial warning of the year came as it reduced its
already-reported fourth quarter revenues by $125 million attributed to a
revenue recognition problem for the three months ending September 30, 2000.
As a result, Lucent will restate its fourth quarter revenues, previously
$9.4 billion, and will reduce its profit from continuing operations from
$0.18 per share to $0.16 per share.

NorthPoint Revises Third Quarter Results (11/21/2000)
NorthPoint Communications restated its third quarter results, cutting
revenues by $6 million to $24 million. Citing the financial weakness of
some of its customers, NorthPoint claimed that it would not receive timely
payment for its services. The result was an EBITDA loss widening to $90.9
million from the $79.2 million previously reported.

BT Offering Tranches (11/20/2000)
British Telecom will sell between $6.0 and $8.0 billion of a multi-tranche
global debt offering in the coming weeks. The offering is expected to
include five-year, 10-year, and 30-year tranches.

NTT Reports First Half Earnings (11/20/2000)
NTT reported a group operating profit for the first half of its fiscal year
of 610.3 billion yen, an eight percent increase from 563.9 billion yen for
the same period last year. Revenues rose 10 percent to 5.49 billion yen,
compared to 5.01 billion yen. NTT DoCoMo's wireless businesses, especially
its wireless Internet operations, contributed to the revenue growth as the
NTT group is changing its focus from fixed-line to wireless businesses.
However, NTT's net profit fell 27.1 percent to 175.4 billion yen. During
the first half of the fiscal year, NTT was hurt by rate cuts caused by
Japan's trade accord with the US and by pressure from fellow Japanese
telecoms and regulators to loosen its structure and to allow for more
competition. The Japanese government, which owns 46.7 percent of NTT,
decided to restructure NTT, which includes giving more independence to
DoCoMo and NTT Communications.




Internet/Intranet
KPN to Give Unmetered Service (11/22/2000)
Dutch telco watchdog, OPTA, ruled KPN must offer Internet access at a flat
rate to MCI WorldCom's ISDN clients until July 2001 and urged the former
telco monopoly to improve data transmission capacity on its network.

BT Working with Firms for Content (11/21/2000)
British Telecom is working with entertainment firms as part of a plan to
develop programming for its Internet service, BTopenworld. BT wants to
split the costs with the firms and is also seeking US and European service
providers to back the initiative. In related news, BT bolstered its
Internet content by paying $15 million for a 17-percent stake in cities, a
UK company that provides information on local services. BT will be able to
send audio, text, and videos of hotels, tourist sites, and maps to Internet
phones using GPRS and 3G technology.

Net2Phone Introduces Communications Suite (11/21/2000)
Net2Phone introduced a suite of communications designed for both
individuals and businesses. The services cover inbound call management,
outbound calling from any device, and speech recognition. Among the new
services that make up the suite, Net2Phone is including free and low-cost
PC-to-phone  PC-to-fax, and PC-to-PC calling services throughout the world,
a free Internet Answering Machine, and free voice e-mails. The company
combines its Internet call waiting with domestic PC-to-phone calling to
create an inbound and outbound call management solution.

WorldCom Creates Spanish Online Tech Glossary (11/22/2000)
WorldCom released the Tecnoguia, an online searchable Spanish and English
telecommunications glossary of high-tech and Internet-related terms. The
glossary was co-developed by the Tomas Rivera Policy Institute, a think
tank on Latino issues.




Personnel and Organizational Changes
Ericsson Forms New Company (11/22/2000)
As part of a plan to focus on Bluetooth development, Ericsson is forming a
new company that will expand Ericsson's current Bluetooth product
portfolio. The company will license technology to develop solutions for
hardware, software, training, and support. Ericsson's Bluetooth company
will license its own technology to chip and module manufacturers and OEM
manufacturers that develop mobile devices for consumers.

AT&T Considers COO (11/21/2000)
To assist in the restructuring of its company, AT&T may name a COO to
manage the monumental breakup. The new COO would assist and report to C.
Michael Armstrong, CEO of AT&T, and take the helm of the Business Services
Unit once the process is complete. One possible leading candidate for the
new position could be David Dorman, head of Concert. The restructuring plan
could take two years to implement, and the company may need someone to
focus solely on these intricate efforts, which could include assigning
employees and customers to each division and possibly launching an IPO.

TW Telecom Names Miracle Midwest VP (11/21/2000)
Time Warner Telecom promoted Bob Miracle to regional vice president of the
Midwest Region. Miracle, who previously held the position of general
manager of Columbus operations, will be responsible for operations in
Columbus, Cincinnati, Dayton, Milwaukee, and Indianapolis.

INTELSAT Privatization Plan Approved (11/21/2000)
The INTELSAT Assembly of Parties, which represents the 144 member parties
involved in the satellite venture, approved a privatization plan for
INTELSAT. Under the plan, all assets, liabilities, and operations are being
transferred to Intelsat Ltd., a holding company based in Bermuda, while all
C- and Ku-band satellites and the licenses to operate them will be held by
Intelsat LLC, which is located in Delaware. The company's service
subsidiary will maintain its headquarters in Washington, DC. In addition, a
new board of directors will be chosen by all of INTELSAT's shareholders
when the group is privatized; and a year after the plan is complete,
INTELSAT will conduct an initial public offering.

Nextel Appoints CFO for International Unit (11/21/2000)
Nextel Communications is appointing Steve Shindler CEO of Nextel
International. Shindler had been serving as the company's CFO along with
serving as acting CEO of the international unit, which provides wireless
services in Latin America and Asia. Nextel treasurer John Brittain will
succeed Shindler as CFO.




Regulatory News
US Comes Closer to Seeing NTT Curbed (11/20/2000)
Recommendations under consideration by Japan's Ministry of Post and
Communications call for a restructuring of NTT. The company has come under
intense fire recently for using its near-monopoly position to stifle
competition in high-speed Internet services, and the US government has been
pushing Tokyo to curb NTT's power over the telecommunications market.

WorldCom Must Shed Intermedia Assets (11/22/2000)
WorldCom's acquisition of Intermedia Communications has been approved by
the Justice Department with the stipulation that it must shed Intermedia's
business operations except the controlling stake in Digex.

Black Crow Shakes its Money at FCC (11/21/2000)
The FCC accepted Black Crow Wireless as a bidder for C and F block
broadband PCS spectrum to be auctioned off beginning December 12. The
company will have the opportunity to bid for 422 licenses that cover over
195 markets. In other news, USCC Wireless Investment, a subsidiary of
United States Cellular, is now a limited partner in Black Crow Wireless.

Wireless Carriers Not Cleared for Auction (11/20/2000)
The FCC did not clear major wireless carriers such as AT&T Wireless,
Cingular Wireless, Nextel, Sprint PCS, and VoiceStream Wireless to bid in
the December 12 airwave auction. The FCC has approved 44 wireless companies
while 66 others need to file new applications since the Commission stated
that their original applications were incomplete. Companies must submit
their applications along with a down payment by November 27. Interest in
this auction is high because of the lack available spectrum.




Satellite Communications
DirecTV Launches First Interactive Channel (11/22/2000)
DirecTV launched "Instant Weather" from The Weather Channel, the first
dedicated interactive channel available on the DirecTV Interactive service.
The new channel is available to more than one million DirecTV customers
nationwide.

Lockheed Martin Shipping Satellite (11/22/2000)
Lockheed Martin is shipping the GE-8 telecom satellite to its launch site
in Kourou, French Guiana. The satellite is to be  operated by GE Americom,
is a C-band spacecraft with 24 transponders that will provide cable,
broadcast television and radio, telecommunications, business television,
and broadband data to customers in North America, the Caribbean, Latin
America, Europe, and Asia.

ExxonMobil Selects Hughes (11/20/2000)
Hughes Network Systems was selected by ExxonMobil to deliver satellite
services to its petroleum stations. The company signed a five-year
agreement to provide VSAT-based satellite network services at over 12,000
stations and other ExxonMobil sites. Hughes' service will be used for such
applications as credit/debit authorizations and the  monitoring of tank
levels.




Wireless Communications
Metrocall in Marketing Agreement (11/21/2000)
Metrocall entered into a marketing agreement with planetWE, which is
launching Metrocall's two-way wireless messaging in metropolitan areas to
small businesses in the US, beginning in the Southeast. The messaging
service will be combined with planetWE's research, consulting, and
management services that it provides to small businesses.

Nokia Shows its True Colors (11/22/2000)
Nokia introduced its 9210 Communicator, a Web-enabled mobile device with a
color screen that allows for mobile calls, Web access, and e-mail. The
company will make the device available on the GSM market in Europe, Africa,
and Asia beginning next year. The 9210 includes a color display and a
keyboard and combines phone functions with fax, e-mail, calendar, and
Internet services including imaging and video clips.

Nokia the Greek (11/22/2000)
Nokia is delivering a GPRS network solution to COSMOTE, a Greek GSM 1800
mobile operator. In the first quarter 2001, COSMOTE will launch commercial
GPRS services, including high-speed mobile Internet access and data and
video streaming.

QUALCOMM Grants License (11/22/2000)
QUALCOMM granted a CDMA license to eAnywhere Telecom, which is now able to
develop and manufacture subscriber unit and modem cards using QUALCOMM's
CDMA technology.

Verizon Adds Multimedia Feature to Mobile Web (11/22/2000)
Verizon Wireless launched an interactive multimedia display for its Mobile
Web service. The display, designed by Multimedia Solutions Corporation,
provides information on how to use the Mobile Web. Users are able to surf
Verizon Wireless' Web sites, to create a MyVZW.com profile, to use a demo
of Mobile Web, and to send text messages to digital phones.

Verizon Wireless Trials 3G Technology (11/22/2000)
Verizon Wireless announced a test trial of cdma2000 1xEV, a high speed data
rate technology that will support up to 2.4M bps in its existing spectrum
on current base station equipment. The trial is expected to accelerate the
deployment of high speed data services throughout the network, as it
delivers faster wireless Internet access than the third generation (3G)
enhancements the company is currently testing with Lucent Technologies. The
1xEV trial, expected to take place next year will boost Verizon's ability
to offer mobile Internet services including instant messaging and streaming
audio and video and will enable mobile web browsing and office
capabilities, as well.

Nokia Defining Mobile Internet Architecture (11/21/2000)
Nokia is creating a global initiative for the creation of a technical
architecture for the mobile Internet. The company is calling it the Nokia
Mobile Internet Technical Architecture, which is designed to provide
interoperability between interaction modes and network environments. Nokia
is inviting other companies, including developers, service providers, and
operators, to take part in the initiative. In related news, Nokia created
the Advanced Application Programming Interface for its Nokia mPlatform
Solution, which allows operators, developers, and service providers to
develop mobile services.

Nextel Partners Launches Service in Georgia (11/21/2000)
Nextel Partners is offering four-in-one service to customers in Macon and
Dothan, Georgia. The service includes digital cellular, Direct Connect
two-way radio, wireless Internet, and paging via one phone. Nextel and
Nextel Partners offers this services to business customers, who can use it
to communicate with up to 100 employees in one area.

Motorola Wins China Contract (11/20/2000)
Motorola's Global Telecom Solutions Sector was awarded a $29-million GSM
expansion contract in the Zheijang Province in China. The contract was
awarded by the Zheijang Branch of China Mobile Communications and calls for
the integration of Motorola's Horizonmacro GSM infrastructure solution with
the existing network in four major cities. Motorola will also provide two
new offerings under this contract, including wireless applications and
consulting services.

Nokia in GSM and 3G Deal (11/20/2000)
Singapore’s M1 entered into an agreement with Nokia to build a GSM 1800 and
third-generation mobile phone network after M1 bids in a 3G license auction
in 2001. Nokia’s network will be the replacement for the CDMA network
currently used in Singapore. The GSM system is 3G-ready and will support
WCDMA-based services. Nokia is also M1’s sole supplier of 3G technology,
which will be used for such applications as messaging, mobile commerce,
wireless Internet access, and imaging. The agreement with Nokia is part of
M1's $500-million investment in its Singapore-based network.

Sprint PCS Launches Service in Duluth (11/20/2000)
Sprint PCS is bringing its services to customers in Duluth, Minnesota. The
company now offers its digital services in 300 markets and 4000 cities and
communities throughout the US. Customers in Duluth and its surrounding
areas are being offered a promotional plan, which includes 1500 minutes for
$34.99 a month, including long distance.

Happy Thanksgiving
All  of us at Faulkner Information Services would like to wish you a happy
and healthy Thanksgiving.

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