WorldCom, Williams Reach Deal On Cross-Use Of Fiber-Optic Networks
July 09, 1998 11:45 AM
TULSA, Okla. -(Dow Jones)- Telecommunications
giant WorldCom Inc. and Williams Cos., an energy
company that recently reentered the telecommunications
business, said Thursday that they have reached a
settlement in a dispute regarding use of a single strand of
fiber in a network acquired by WorldCom from
Williams in 1995.
Three years ago, Williams sold almost its entire national
network, known as Wiltel, to WorldCom for $2.5
billion. As part of that deal, Williams agreed to not
compete against Worldcom for three years in selling
many kinds of telecom services. The noncompete clause
expired in January, when Williams announced its return
to the business with an 11,000-mile fiber-optic network
and $1 billion in contracts.
Williams said Thursday that the settlement gives it the
right to purchase, with restrictions, a single strand of
fiber on WorldCom's constructed long-distance
networks. The single fiber is to be used for carrying
video and Internet traffic, but excludes fax or voice
transmissions throughout the public switched network.
Williams (WMB) said all restrictions on the use of the
fiber will expire in July 2001, making it available to
support all long distance, data and voice applications in
addition to other services after that time.
Jackson, Miss.-based WorldCom (WCOM) will have
the right to purchase, without restrictions, a single fiber
on selected routes along Williams Network's existing
network as well as its fiber in development.
Williams filed the lawsuit in March, claiming that the
1995 deal contained a provision that gave it the right to
buy fiber-optic capacity at "economical rates"
throughout WorldCom's network.
Tulsa, Okla.-based Williams wants to expand beyond its
status as the nation's largest operator of natural gas
pipelines. It is bidding to become one of the country's
main providers of wholesale high-speed communications
services, capitalizing on the practically insatiable appetite
for networks that can carry voice, video and data traffic.
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