Crowe unveils Internet-based fiber-optic network
USA Today
James Crowe, who built MFS Communications and sold it to
WorldCom for $14 billion, is going to try to create his second
communications giant by proving that the big phone companies are
obsolete.
Monday, Crowe unveiled plans for Level 3 Communications, which will
construct a nationwide fiber-optics network -- the first based entirely on
Internet technology instead of switched telephone technology. Level 3
is backed by Peter Kiewit Sons' Inc., the Omaha construction group
that originally financed MFS in 1987. Crowe did not reveal the
start-up's funding, but he said it has enough capital to build networks all
across the country.
The company is a gamble that a network based on Internet Protocol
(IP), which now carries mostly computer-to-computer Internet traffic,
can carry voice and all other kinds of traffic as reliably and far more
inexpensively than traditional telecommunications networks. The
reliability, especially, is not yet proved.
But, Crowe says, ''We believe IP is ready for prime time now, not in
the future. These new networks are a lot less expensive than the
traditional 100-year-old telephone networks.''
IP networks break all communications into tiny digital packets of
information, which are efficiently routed through the network by
computers and reassembled at the other end. By contrast, phone
networks open a line, or circuit, between two parties for the duration of
a call, even during silences when no information is being transmitted.
That's a far less efficient use of the network.
Level 3 plans to sell communications services to businesses, as MFS
does, and resell capacity to other carriers, such as AT&T or Sprint.
Level 3's system will convert phone calls, faxes and other non-Internet
traffic to the digital packets of IP, transmit the packets through the
Level 3 network, then turn that traffic back into regular phone and fax
signals at the other end.
Crowe had been on the board of Qwest Communications, another
company building a new nationwide fiber network. Denver-based
Qwest is using both telephone and IP technology. Crowe resigned from
Qwest's board 30 days ago, he says.
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