Level 3 Launches First Long Distance IP Voice Service with Quality and Clarity of Traditional Phone Service
(3)Voice Service Combines Traditional Voice Quality with Cost Benefits of Internet Technology
BROOMFIELD, Colo., Dec. 13 /PRNewswire/ -- Level 3 Communications, Inc. (Nasdaq: LVLT - news) today announced commercial availability of its (3)Voice(SM) service. (3)Voice is an enhanced service delivered over Level 3's end-to-end Internet Protocol (IP) network that offers customers voice quality indistinguishable from traditional telephone networks, but with the efficiencies and inherent cost advantages of IP. (3)Voice requires no change in how end-users dial or in the equipment that they use.
The service will initially be offered on a wholesale basis to resellers, other carriers, enhanced service providers, fax service providers, wireless service providers and competitive local exchange carriers. The initial rollout will be in major markets across the U.S., and the company plans to continue to expand to additional markets over the next year.
''We believe the launch of our (3)Voice service is a threshold event not only for Level 3, but for the communications industry as well,' said Kevin O'Hara, executive vice president and chief operating officer of Level 3. ''(3)Voice is the world's first IP voice service to offer the quality and simplicity of everyday phone service ... no extra numbers to dial ... no new equipment ... and no sacrifice in sound quality.'
''To ensure quality, our engineers will continuously monitor a range of metrics such as latency, jitter and packet loss -- and if the quality should ever temporarily drop below the quality of the traditional phone network, we would move our customers' traffic onto the traditional phone network. All carriers in the industry have such overflow contracts in place to enable them to move traffic back and forth as needed,' said O'Hare.
One of the initial customers signing a contract for (3)Voice is Network Enhanced Technologies, Inc. (NET), an international telecommunications service provider based in Los Angeles. ''IP communications technology clearly is the wave of the future,' said Frank Tizabi, chairman of Network Enhanced Technologies. ''Level 3's rapidly expanding private IP network and Softswitch- based infrastructure will enable us to provide reliable, high-quality voice transmission at more competitive long-distance rates. Equally important to NET, we expect over time to realize the increasingly significant cost benefits that IP is anticipated to bring.'
Commenting on the continuing cost benefits of the new service, Level 3 Chief Technology Officer Jack Waters said: ''We run our voice services on general purpose computing platforms, so our cost of providing services is expected to follow a Silicon Economics curve. Doubling performance per dollar every 20 months is a new phenomenon in voice services and creates the kind of cost reductions that, thanks to Silicon Economics, have been seen in the computing industry for years.'
(3)Voice - The Supporting Technology
Level 3's Softswitch-based network architecture currently processes over a billion minutes of Internet connections per month - for Level 3's Managed Modem service. (3)Voice service will be carried over the same Softswitch technology to provide enhanced quality and efficiency, thereby reducing the cost of carrying voice telephone calls.
''Ever since we announced the start of our network construction in the summer of 1998 we have been moving toward making this service available,' said O'Hara. ''This new voice service will use the same proven Softswitch technology over which we have already been carrying millions of dialup Internet connections every day for our Managed Modem customers.'
Softswitches are technically advanced software control systems, which Level 3 uses to provide customers with services that combine the innovation and rapidly improving price performance of Internet Protocol based networks with the reliability and ubiquity of traditional telephone networks.
(3)Voice - The High Quality Service
Level 3 transports voice calls across its U.S. long distance IP network and then connects these calls to local phone companies that use traditional protocols to complete the call in a given city. This long distance transport is done without traditional circuit switches over the Level 3 Network, using Level 3's Softswitch-based infrastructure to seamlessly integrate today's telephone networks with Level 3's enhanced infrastructure. As a result of the Softswitch platform and the privately managed IP network, the quality and user behavior is indistinguishable from traditional phone service.
(3)Voice - The Enabler Strategy
Level 3 is focused on providing superior, low cost ''enabling' services to wholesale customers who, in turn, have expertise in offering value added services to end users. The company's (3)Voice service initially targets the approximately $16 billion U.S. wholesale telecommunications market (Source: International Data Corporation, 1998). Other telecommunications carriers and enhanced providers, which are continuously seeking a more efficient and economical way to transport and terminate traffic anywhere in the world, will now be able to transition from traditional telephone network infrastructures to Level 3's newer, more cost efficient network optimized for Internet technology.
Over the course of the next year, (3)Voice's enhanced capabilities will be extended to include expanded billing and routing capabilities and native IP interfaces to support additional carrier, Internet service provider (ISP), and application service provider (ASP) requirements.
''We believe this robust and commercially available IP service will spur a wave of innovation in IP-based voice services and enhancements that will bring new benefits for our customers,' said Ike Elliott, vice president of Softswitch Services for Level 3. ''With our open (3)Voice architecture in place, we anticipate new product developments from many companies, including Internet companies. We believe the potential exists for this new development to rival the growth in the World Wide Web.'
(3)Voice service will initially be available in the following 10 markets: New York; Los Angeles; Chicago; Washington, DC; San Francisco; Denver; Dallas; Detroit; Seattle and Tampa -- and is expected to expand to 25 cities by the end of the first quarter of 2000. The inherent benefits and efficiencies of Level 3's Softswitch IP infrastructure will allow Level 3 to offer some of the most attractive pricing available -- generally below the lowest current competitive wholesale pricing in the initial markets. Pricing will vary based on the call termination destination and on volume and term discounts. Over time, the cost of this IP service will continue to drop, driven by the continuing price performance improvement seen in other high tech silicon- industries like computing. For more information on the (3)Voice service, visit the Level 3 Web site at www.Level3.com.
About Level 3 Communications
Level 3 Communications, Inc. (Nasdaq: LVLT - news) is a communications and information services company that is building the first international network optimized for Internet Protocol (IP) technology. The Level 3 Network, with both intercity and intracity segments, is able to connect customers end-to-end across the U.S. and in Europe and Asia. At completion, the Level 3 U.S. network will consist of approximately 16,000 intercity miles, connecting 56 cities in which Level 3 will offer service. The 4,750-mile Pan-European network will connect 23 markets in which the company will offer service. Level 3 sells a range of network services to web-centric companies that add value and deliver their services to end-users over the Level 3 Network. The company is traded over the Nasdaq National Market (U.S.) under the symbol LVLT. Its web address is www.Level3.com.
The statements made by Level 3 in this press release may be forward looking in nature. Actual results may differ materially from those projected in forward looking statements. Level 3 believes that its primary risk factors include, but are not limited to: substantial capital requirements; development of effective internal processes and systems; the ability to attract and retain high quality employees; changes in the overall economy; technology; the number and size of competitors in its markets; law and regulatory policy; and the mix of products and services offered in its target markets. Additional information concerning these and other potential important factors can be found within Level 3's filings with the U.S. Securities and Exchange Commission. Statements in this release should be evaluated in light of these important factors.
SOURCE: Level 3 Communications, Inc.
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